Latest tech merger: Microsoft acquires Kiwi cloud computing company GreenButton

GreenButton’s customers include Pixar, NASA and Boeing. But founder and CEO Scott Houston discloses his stint as Weta Digital CTO and the massive computing power required by the Lord of the Rings movie spurred him to create a start-up that became GreenButton.

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GreenButton CEO Scott Houston and Frazer Scott, director of marketing and operations,Microsoft NZ

Exactly a week ago, Scott Houston cracked open a fortune cookie at the end of his meal in a restaurant in San Jose, California.

Inside was this message: “You will be successful through innovation and determination.”

Surely, this message must be de rigueur in fortune cookies in Chinese restaurants around his office. This was, after all, Silicon Valley.

Houston, however, kept the strip of paper, unfolded, inside his wallet.

It was a foretelling of what was to come.

For today, Microsoft announces it has acquired GreenButton and will integrate it into Azure, Microsoft’s public cloud offering.

“Push the button and everything else happens,” says Houston. “This will be the de facto standard, the way users access the cloud.”

The acquisition will further bolster Azure, and highlight the company’s commitment to “big compute in the cloud”, says Frazer Scott, director of marketing and operations, Microsoft New Zealand. “This is right in the direction of the messages of Microsoft CEO Satya Nadella about big data and big compute.”

GreenButton provides cloud solutions for compute-intensive application. Its flagship product, GreenButton Cloud Fabric, is for enterprises and software vendors wanting to access unlimited computing power. Using the GreenButton SDK, applications can be cloud-enabled in hours with no recoding of existing software typically required.

This will be the de facto standard, the way users access the cloud.

Scott Houston, GreenButton

GreenButton's customers include US-based companies Pixar, NASA, and Boeing.

Microsoft NZ managing director Paul Muckleston states, “This is a clear indication that New Zealand is producing world-class, scalable technology solutions.” Microsoft declined to disclose the financial terms of the deal.

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“Data and computation are driving businesses today — but as data volume, variety, and velocity continue to explode, our customers need help processing massive amounts of information and running compute-intensive simulations for a growing number of applications,” says Mike Neil, director of program management for Microsoft Azure. “With GreenButton’s tools integrated into Microsoft Azure, we will provide solutions that allow anyone to harness the power of the cloud.”

"This purchase is a real shot in the arm for other New Zealand companies. It shows that if you take your ideas to the world stage, Fortune 500 companies like Microsoft might just notice. It happened to us, so it's entirely possible it could happen for other Kiwi start-ups,” says Houston.

“As we develop globally, the key development will remain in Wellington,” he says. GreenButton also has staff in Auckland, the US and a contractor in the UK.

This is a clear indication that New Zealand is producing world-class, scalable technology solutions.

Paul Muckleston, Microsoft NZ

The Kiwi DNA

“It started with the Lord of the Rings,” during the filming of the last two movies from the Lord of the Rings trilogy," says Houston. Weta Digital had bought a thousand processors to manage the shots around the battlefield.

“Having all that capacity left over, I founded the NZ Supercomputer Centre in 2004,” he shares. The NZ Supercomputer Centre was a partnership with Gen-i and Telecom.

In 2006, he formed InterGrid, which provided computer processing for customers including software vendors. Houston says in 2011, the company was renamed, taking the title of its flagship product.

Houston says they recognised they needed a global platform and partner and started working with Microsoft primarily from 2010 onwards.

Houston discloses that the relationship with Microsoft was strengthened when GreenButton joined the BizSpark programme. The latter supports start-ups with free software, and support for three years. “We have really been incubated by the team here,” he says. "It was a real partnership, an acquisition by osmosis.”

Lessons on starting up

Houston discloses he had “doubts, lots of times” during the 10 years he and the investors and supporters were building the company.

“I like to think the lessons we learned are not what to do.”

He says “the world has no problems with doing development work in New Zealand”, but start-ups have to be in the market in order to sell, which meant establishing an office in the United States. “We should probably have moved [to the US] earlier.”

He says marketing the company in the US was another area they could “have definitely done better”.

As well, support from the investors was critical. “The massive opportunity comes in an extended time frame,” he states. “We have to be nimble, but when you are working with Fortune 500 companies, you [must] have the fortitude, determination, and support from your investors to stay the course. That has been incredibly important.”

Houston says Marcel van den Assum, having left Fonterra as CIO, was one of GreenButton’s original angel investors. Van den Assum, is now chairman of the NZ Angel Association. “He has been a real voice of wisdom and mentor for me."

Sidebar: A hi-tech career

Scott Houston says he is keeping the message from the fortune cookie for posterity.
Because, as he puts it, GreenButton is not an "overnight success".

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