If the old brick house blaring classic rock in downtown Waterloo doesn’t tell you FoxNet Solutions is a different kind of IT operation, then maybe the bar inside, fitted with a pair of draft taps, will.

Either way, Bill Fox and his seven-member team have managed to defy most IT-guy stereotypes as they’ve steadily built towards $15 million in annual revenue, which they hope to see this year.

That means working hard to meet the ever-evolving needs of a list of mid- to large-sized clients that include software giant OpenText and satellite systems leader COM DEV, but also playing hard to infuse the FoxNet team and its customer relationships with some fun.

I bellied up to the FoxNet bar recently, where Bill pulled us a couple of cold ones as we talked about his long career in IT, industry trends and the importance of mixing pleasure with business.

Q – Tell me about your IT career.

A – I started in the mid-to-late 80s with Hewlett Packard and I worked there for probably five or six years, from this area. I’ve lived in this area since 1985, and I’m originally from Caledonia, Ontario.

I went to the University of Western Ontario, but I don’t have any sort of technical background; I have an economics background.

I also did accounting-type stuff but I chose not to go into that field.

Eventually I was at HP, and then I went on to Oracle, and through the years of experience there – I was there another five or six years – I met up with a guy who had a business that’s similar to this kind of business, and he and I went into partnership.

I opened up what was basically a southwestern Ontario affiliate of what he was doing in Toronto. The company was called Arqana.

With Oracle, I was always living here; I was basically a southwestern Ontario representative of both HP and Oracle. I was in sales.

So, Arqana was purchased by Telus around 2001, I guess. Two of the key people who are here with me at FoxNet, I actually hired them into Arqana.

We were purchased by Telus and it was right after the Y2K crash. All the IT companies were struggling; there wasn’t a lot of business to be had and the market was soft.

Telus basically started to retract the offices, and one of the ones was here, so I approached these two key individuals who were with me and said, ‘Hey, why don’t we just start it up on our own?’

So we actually took the office back from Telus and went back out to the customers who knew us, and it’s been 10 years now.

We stayed in that office, on King Street in Waterloo, for a while and we then moved here. We purchased this building and redid the whole thing for what we wanted to do about six years ago.

Q – What made you choose this location?

A – We like being in Uptown Waterloo, for starters. The rent was getting crazy, and it was getting to the point where we didn’t have enough space, so we felt, ‘Maybe we should try to buy something, and something kind of different for IT.’

We don’t have inventory or anything; all we have is people. We have a training centre in here, as well as our boardroom and entertainment centre.

Q – I was going to say, before I even came inside, I thought, ‘Wow, this is not what the average person would probably expect of an IT business.’ It’s a really cool old house and you come in and there are beer taps, and there’s rock blaring from the radio.

A – That’s sort of one of our signatures as an IT company.

We have a lot of events. We actually do an annual golf event for KidsAbility; we’ve raised almost $70,000 for them over the last few years.

Our events tend to be injected with lots of fun; we just had our Kim Mitchell 10th anniversary party; we always have a St. Paddy’s Day party. We do a lot of that kind of stuff with our customers and our vendor partners.

Going back to the genesis of what we were selling, we were strictly a Hewlett Packard partner when we began. Given our background, we knew a lot of the Hewlett Packard customers, so we became specialists in delivering the infrastructure for customers who had rather complex business needs, and business applications like SAP which I’m sure you’ve heard of.

That was our only focus for the first few years, but as the market changed, we adapted our product family to reflect that, and we started going into the virtualization market, where virtualized software called VMware is one of the leaders.

Q – Simply put, what is virtualization?

A – It’s basically taking several hundred physical servers, pieces of hardware, and virtualizing them using software to what is probably at least a 10-to-one ratio. So, it’s a good, green type of initiative because it saves so much power and air conditioning and all that kind of stuff, but it also reduces the footprint of your IT.

We’ve done several of those big projects.

Q – How does software replace a bunch of servers?

A – Basically it has the ability to act as a server, so we could put virtual servers onto one physical machine, but each one of these virtual servers does exactly what a physical server would do in the past. So, it acts and behaves just like a regular server, except the software allows it to run its application in combination with other virtual servers on one physical piece of hardware.

Storage is also a very large aspect of what we do. We’re talking in terms of hundreds of terabytes of storage with most of our companies.

Q – So most of the hardware resides with your clients, and you’re showing them how to use it to their best advantage?

A – There are myriad solutions that a customer could require, and what we do is architect it. They say, ‘We’re trying to solve this problem,’ and we have a number of different solutions that might fit that. Our job is to come to the table with the right solution that’s the most economical and fits their environment.

Q – Where are most of your customers?

A – Ontario. We have quite a few in this area, but we have customers as far away as Sarnia, downtown Toronto, Hamilton and London. K-W and Cambridge is a good area for us in terms of us for our customer base.

Q – How big is your biggest customer?

A – ArcelorMittal, which is formerly Dofasco, has been a big customer of ours for a number of years, and there are thousands of employees there.

The University of Western Ontario is a big customer of ours.

OpenText is a very big customer of ours, but in terms of employees, they wouldn’t have tens of thousands, but they’re also the largest software company in Canada.

So those are three notables.

We also do business with FedEx Canada, which is a large entity.

Our focus really is not the small business market; it’s more mid-sized and upwards.

COM DEV is a very big customer of ours, actually. They’re not that big a company, but they are all knowledge workers, and anybody that has a number of knowledge workers and engineers, there’s a lot of sophistication they need.

Q – Respond to this statement: “IT is boring and not at all sexy.”

A – Of course, we are the plumbers of the tech world; that’s why we don’t get the glamour and the press that others would get. Maybe we don’t have plumber’s butt and all that stuff, but it is just not the sexy stuff, and we’re not the creators of our own technology. We are basically in a systems-integrator, solution-provider kind of role.

Q – But?

A – But it’s very interesting work. We’re solving business problems, and without it all the sexy business applications don’t run properly, unless that superhighway underneath it is also performing properly.

In a lot of cases, they’re the most hated people in a company. We are not, in that sense, because we are just providing it; we’re not doing the day-to-day maintenance on it, and we’re not the ones you have to come and ask for this and that and the other thing.

Our customers are the IT guys.

Q – Getting back to COM DEV, you’ve worked with some really big clients with some unique demands. Tell me how unique COM DEV’s problem was and how you solved it.

A – They have to keep their information for a long, long period of time, because they have components of satellites up in the sky for, maybe, 20 years at times.

So, that information, as you can imagine, has a lot of data in it, and that needs to be archived and be able to be accessible, and you don’t want to leave it on your primary, expensive storage solutions.

The idea is to take that information and have it automatically – say, after two years – archive into a cheaper way of storing it that you can still access if there is a need to access it.

There’s a number of different ways you could have sliced it, and the way we approached it seemed like the best way, and I think it will be the best way.

Q – Twenty years in IT is like 150 normal years. How do you ensure that, 20 years down the road, that information is still going to be there?

A – All we can do is look at what technology is available today. There are different ways of backing stuff up, and different ways of restoring stuff. We always try to pick leading-edge and top people in their field.

With the products that we sell, they are either Number 1 or Number 2 in their existing fields, for today’s market. So, we always try to be a partner of a leader.

As time goes by, those leaders change places; however, if we’re staying on the cutting edge of what’s the best product available, we’re not tied to one or another vendor. We can add a vendor.

So, if there’s some super-great solution that comes out, say, five years from now that we’re not even aware of, because we have clientele and because we have good relationships with vendors, we’ll be able to go to them and say, ‘Hey, we want to be a partner in this product.’

And in most cases, because we are established, it’s not difficult. We just have to qualify certification-wise.

Q – Tell me about another case where someone had a unique need and how you met it.

A – Going back to the virtualization thing – which isn’t really unique because there are other people doing it in the industry – OpenText had thousands of physical servers that they have virtualized down into several hundred.

Because they’re such an acquisition-driven company – they’ll buy a company and it will have a whole bunch of servers – it’s really important for them to be able to just virtualize all that stuff and keep it in centralized data centres.

That was the biggest virtualization deal we’ve ever done, and it’s maybe one of the bigger ones. Excluding, maybe, RIM or a couple of others, it would probably be right there as the top case study for virtualization in this area, for sure.

We’ve also done a lot from the standpoint of SAP infrastructure, but again, it’s not something unique enough that others could not do. But it’s a significant amount of IT architecting that goes in behind the successful SAP implementations, of which we’ve done several.

A lot of times, a company just has a business application, we go in and build it and structure it and make it run properly. That is really the nuts and bolts of it.

Q – What’s the biggest change you’ve seen in clients’ needs during your time in the IT field?

A – At one time it was very, very easy; there were way fewer IT vendors in the marketplace. It was essentially dominated by a few companies on almost every front, HP being one of them, IBM being another.

Now you’ve got a lot more point solutions that are actually more effective than, say, the big giant companies that have a solution but it’s not leading-edge. So, the big challenge is integrating the point solutions and making sure it’s still a solid type of infrastructure that we’re providing.

There are many vendors of IT because IT, in a lot of ways, has gotten more complex. The users have more access to information; the users have more ability to do things, and that creates strain on the IT guys.

When I first started at HP, there weren’t even PCs at that time. So, I’m old.

They were just dumb terminals sitting in front of you. There was just text there, and the applications you would get would be exactly what the corporations were providing off of some large, centralized server somewhere.

But it’s gone from centralized to ‘distributed,’ they call it, back to this virtualization concept, which is actually centralizing it again – but centralizing it way more efficiently, and centralizing a whack of different applications that the users have access to.

Q – What is the biggest myth about IT?

A – You mean, like, the socks-and-sandals and plastic pocket protector kind of thing?

I’m not going to say some of that isn’t true, but I think the awareness of the importance of IT in companies that are progressive is better than it was years ago.

It’s not just a necessary evil to the business leaders and their companies. Some still look at it that way, but I think the business leaders who are forward-thinkers look at IT as a strategic part of their business; something that’s running their business.

If they’re making steel, it’s not making them steel, but hopefully it makes them run their applications more efficiently so they can build steel faster and of higher quality, or whatever it may be.

Q – So they see IT as integrated into everything else they do, rather than a separate thing that’s a bit of a pain?

A – The companies that are forward-thinkers do think that way. They realize it’s part of their success, not something they have to just put money into to keep going.

Q – What about the future of IT? Where do you see things going in the next five or 10 years, and what do you need to do to adapt?

A – Well, there are going to be applications moving into the cloud, for sure. So, there will still be a need for IT for the bigger companies to run their own business applications, their crown jewels. There’s going to be that need for at least the next five years.

If you look at Gartner Group or IDC or some of these guys, they think over the next two years maybe 20 to 30 per cent of the business applications will probably be in the cloud.

So, those are sort of the non-critical-to-running-the-business kind of applications.

Because it’s a really evolving area for us, and we don’t want to lose 30 per cent of our business, we need to partner with companies who are going to be working with solution providers like ourselves to bring cloud applications and cloud services to the market.

We’re already developing strategies and partnerships as we go, to see what would be the best play for us, and where we’ll be able to add the most value in our customer base and with new customers.

We still will be providing IT infrastructure, but it will get reduced as some of these things move off into the cloud.

I don’t think it’s going to go away in the foreseeable future, and the cloud is really targeted toward companies like ourselves, because we’re a small company and all our stuff could easily go into the cloud, whereas, in a big company, you’re not going to put all your information up in the cloud, especially if you’re developing software. Trade secrets have got to stay in-house.

Q – We briefly touched on company culture earlier; not every office has beer taps in it like yours does, although perhaps every office should. What have you learned about the importance of culture to getting the job done and meeting your clients’ demands?

A – I’d say for us, culture is a differentiator, with our vendors, even. They have a lot of respect for us, but they’ve said ‘You guys have a lot of fun, and your customers love you so much because you do these things with them and for them’ and that kind of thing.

It’s a relationship business. You think of IT as more stuck in the back corner, but it’s not that way. It is all relationships. It’s expertise, but the relationships have to be there, because other companies have expertise.

The loyalty that we have with our customer base and with the people who work here is based on the fact that it is fun, we do stuff to make it fun and we’re doing things differently than most of our competitors.

Q – How are you different in that way?

A – A lot of the examples are really the events we have. We’ll do lunch-and-learns here, I have a barbecue here, we’ll have beer and have an information session.

I already talked about our golf tournament, but it’s always extremely well-attended every year, to the point where the vendors are basically asking to give money so that we can buy prizes and donate money to KidsAbility.

have a St. Paddy’s Day party, we have a U.S. Thanksgiving Day party here, we recently did our Kim Mitchell thing, which is a once-in-a-lifetime sort of thing, but we had roughly 250 people there, at Bingemans.

Everybody’s been raving about that ever since.

We’ve hosted seminars at Brick Brewery before – it sounds like there’s a lot of alcohol involved – but we try to mix in some fun to things, because it can get pretty boring sitting around talking about IT.

One of the reasons why we’ve done well is that we have tremendous loyalty with our customers, and we have really good business partners who really support us.

We’ve built a reputation for being a good company to work with from the vendors’ standpoint, and the customers have a lot of faith in what we deliver.

Q – Where does your insistence on a fun culture come from?

A – It’s partly the way I am. But, going back to the HP days, they had what they used to call a beer bash every month. They’d actually have beer and pizza in the office, and on Friday afternoon at 3 o’clock, there would be a message to employees.

They had picnics, they had Christmas parties, and these were all paid for by the company. Those days for the big companies are gone; they don’t do any of that kind of stuff any more.

Even when it comes to golf tournaments and stuff, everyone used to have a golf tournament. We’re one of the few that actually still holds a golf tournament, but our customers have come to sort of expect this annual tournament. They start asking, ‘Hey, when’s your tournament?’ around April.

And the people here are also fun-loving people and we tend to have a good time together. It’s a small business, which is also like a small family, but I myself like to have a lot of fun, and I want to have fun when I’m at work. I think the customers pick up on that, because they want to have some fun, too.

Q – What is your title, CEO?

A – I don’t know if I even have a title. I guess I write down ‘president’ or whatever, but there’s no official title that I carry.

I still put the Christmas lights up outside at the beginning of December, and shovel the driveway and stuff.

Q – You sound more like a dad.

A – Well, we take a lot of pride in this place, although the deck needs a staining.