Small business banks on IT backup

What Blue-Lock does is complicated: It provides what is known as "virtual cloud computing." So when Vice President
Wolff explains the concept, he simplifies it—by using Legos.

He puts down one block to represent a computer server.

"In the old world," he says, "you’d put a physical server in place and then you would load a database on that
server. But
if that server broke, you’re offline."

So he puts another Lego on top of the "server." This one represents VMware-software BlueLock buys that allows more
use of that physical server.

Next to the first "server," he puts another block—an additional server. If that first server goes down, the
the data to a separate piece of hardware, and it’s back online in 15 minutes.

Basically, he explains, BlueLock provides IT infrastructure—or servers—for companies to load their software applications
Companies pay a monthly fee—from as low as $900 to as much as $15,000 a month—for that computer power, storage and

"But you don’t buy any of the underlying hardware," which can cost at least $300,000, Wolff said. "You just
load your software
in there. We monitor it, we maintain it, and you just pay monthly for the amount of capacity you need."

This allows businesses to concentrate on their core operations without having the expense of hardware and personnel to maintain
it. Since about half of BlueLock’s clients are software companies, that means they can focus on writing better code and responding
to code changes or upgrade requests from their clients.

"You do what you’re best at," Wolff said. "I’ll do what I’m best at and [you] pay me as you need to grow."

Providing VMware isn’t that novel.

"The technology is just about mainstream," said Chad Miller, a systems engineer in information resources at Butler
"But it is progressive to offer it as a service, with easy scalability … . The moving of server power into the ‘cloud’
depend on corporations’ ability to safeguard their data outside of their walls on cloud servers."

The idea for this service began with BlueLock CEO John Qualls, Chief Technology Officer Pat O’Day and Chief Engineer Ben Miller,
who had worked together for nFrame, a Carmel-based data center, and network-management and disaster-recovery provider.

"I hated to see them go," said nFrame Chief Operating Officer Robert Alcorn, who added that he has not monitored
growth. "But I understood that they wanted to reach out and do something different, so I wished them well."

Qualls had done business with Mark Hill, and the local venture capitalist agreed to bankroll BlueLock with $5 million in startup
funds. They bought their west-side building on Morenci Trail in August 2006, which is when Wolff signed on.

They knew they were onto something, but "it’s always hard to be the new guy," Wolff said. Convincing companies to
them with their data and their assets "took some courage from our early adopters."

"The first six months or a year, we really struggled because we were solving problems for people in ways that were not
to them," he said.

At first, customers were skeptical of having a server fail and being back online in 15 minutes, Wolff said. But eventually
people were sold on the ability to pay for extra server capacity only when they needed it.

Wolff said they learned a lot in that first year. Specifically: Focus on what you need to do, don’t expect to grow as quickly
as you’d like, be as frugal as you can for as long as you can, and be less sensitive to price early on.

"As a startup company, Mark used to say, ‘Find somebody who’ll write you a check,’" he said. "If somebody gives
you money,
they’re committed to trying the product. Getting clients gets the next client to trust that you’ll be around."

What else did they discover? If you have to do too much educating, you have the wrong product at the wrong time. You need
to differentiate yourself from the competition, but you can’t sell something potential clients don’t understand.

Now, he said, BlueLock knows exactly what it’s doing. And it has clients locally (including IBJ Media Corp., which publishes
IBJ)—and in 11 time zones—to prove it.

Jon White, vice president of software development for Indianapolis-based WebLink International, said he’s used BlueLock for
a year. WebLink helps organizations like chambers of commerce and business associations with membership management and other
services. It delivers targeted, customized e-mails to clients’ members.

"When we migrated this service from our old data center to the BlueLock facility, the performance of this application
as measured
by the number of e-mails per second increased from 50 to 100 times depending on the time of day," White said. "All
of this
happened without making a single code change in the application. It was entirely due to the speed of the BlueLock environment."

Walt Meyer, director of development for Vontoo, an Indianapolis-based provider of automated voice-messaging services, said
his company has been pleased to have access to extra server capacity.

"We have called on their ability to provide capacity on demand twice since October," he said. "The first was
for a client
who wanted to send out hundreds of thousands of calls to customers who had opted in for a Black Friday promotion. Most recently,
it was for a video project that we’ve been working on for the Golden State Warriors."

Wolff said BlueLock has cleared its first hurdle—surviving the startup phase—and is now in growth mode. The company
100-percent growth this year and into the foreseeable future.

"Because I can help people to be more efficient, run more efficiently and ultimately save money," Wolff said, "we’re
in a
good place."

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