March 31, 2014 Issue
The Most Powerful Name In Corporate News and Information
Cloud-Managed 3G/4G Networking Solutions for Distributed Enterprises
Interview conducted by: Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – March 31, 2014
CEOCFO: Mr. Mulhern, what is the concept at CradlePoint?
Mr. Mulhern: CradlePoint was founded eight years ago and we provide a set of cloud enabled, multi-WAN supported networking and routing solutions to distributed enterprises. Our core competency, or what we do better than anyone else, is optimizing the 3G/4G cellular link for 24x7 enterprise network environments.
CEOCFO: What are some of the challenges in doing that conversion and what do you understand at CradlePoint that others may not grasp as well?
Mr. Mulhern: Carrier and operator networks are constantly evolving and we work very closely with the Carriers to stay ahead of that curve. Our secret sauce enables two critical things. For the Carrier partners, it is about ensuring that our solutions make the most efficient use of their networks and spectrum. For our customers it is about providing the highest reliability, quality and performance while at the same time minimizing and optimizing their costs when using the cellular networks. We have significant intellectual property in these areas, but even more important is the know-how we have developed over the years, the support we provide our partners and customers and our responsiveness to this rapidly changing environment. I sometimes liken our competitive advantage to the secret formula for Coca-Cola. Each individual ingredient may not be unique, but the way we integrate all the individual ingredients really sets us apart.
CEOCFO: What is the competitive landscape on many companies in the overall field?
Mr. Mulhern: Well there are many companies in the networking space that are calling on the distributed enterprise. But again, we were really the first company very focused on optimizing that 3G/4G link for enterprise networks and we target a sub-segment of the distributed enterprise that we call “Small Footprint Distributed Enterprise” (SFDE). The SFDEs are characterized by lots of locations, no local IT support, have to have a connection to the Internet and are typically involved in customer transactions so PCI compliance is important. Also, because we are a relatively young company we don’t have a lot of legacy networking solutions to slow us down. We are focused and delivering solutions for the network of the future that will be more about wireless, more cloud managed and software defined, more about security and analytics, and that overtime, will start to integrate more and more of the “Internet of Things” solutions that there is a lot of hype around today. There are certainly many competitors out there, but I believe we have a unique and well-differentiated position in the market.
CEOCFO: Was it a deliberate decision to work with that market or was it more opportunistic?
Mr. Mulhern: Well, like most companies where we started, is not where we are today. Our first products were focused on the consumer market and in fact we developed the first MiFi type solutions, or mobile hotspots. Early on we just recognized that based on our engineering capability and where the market was headed we really had a larger opportunity in the enterprise space. So we began by developing a business continuity solution, so if the customer’s wired network failed, they would automatically switch over to the 3G/4G network. We focused initially on the retail vertical and then moved into the finance and insurance verticals. However, what we found is that the Small Footprint, Distributed Enterprise is more of a horizontal market that crosses many verticals. Therefore, our enterprise customers include restaurants, banks, insurance companies and even transportation companies with hundreds or thousands of branch locations. Buses now are becoming like a mobile branch office. In many cases it can be a kiosk, which is essentially a retailer in a box. In addition, we specialize in machine connectivity where higher bandwidth is required. An example would be digital signage.
CEOCFO: How do you reach potential customers?
Mr. Mulhern: We have a multitier, go-to-market strategy. The first piece is that we partner very closely with the various carriers and operators, making sure we work well on their networks and that customers understand we are fully certified on their networks. Then we also have a sales force that will call directly on end customers and then they work with our channel partners to fulfill the complete solution.
CEOCFO: What is the key to keeping up with the new technology? It seems every day there is a new idea. How do you know where to focus, what you might need to incorporate and what may not be so important for your business?
Mr. Mulhern: That is the trick and it is a combination of being very close to our target customers and not necessarily asking them what they need, but to understand what they are trying to accomplish as a business. Then mapping that to where we know that the technology is going so we can stay a bit out in front. Right now there is a tremendous amount of change out at the edge of the network and we are seeing lots of opportunity there. Historically, I think some people have looked at smaller, up and coming companies and said they may have a disadvantage against the big incumbents. What I am finding in the technology space today is that, in many ways, the giant networking leaders can at times be at a disadvantage. We are more nimble and can turn more quickly. We can do in 3 to 6 months, what takes some of the larger players 18 to 24 months to do. Plus, we don’t have the legacy business models that need to be accommodated as this new networking environment emerges. Therefore, we are able to move to new business models and new technologies much quicker than the larger more established companies.
CEOCFO: Would you tell us about the customer service segment of CradlePoint and how you shine in that area?
Mr. Mulhern: It is actually one of the things which I think has made us successful in this market. We have built a very capable enterprise support team and we are very responsive to our customers. This is still an evolving technology area and we work very hard to ensure we meet each and every customer’s needs. And there can be lots of unique requirements in the networking space. It is a value of the company and a credit to the quality and commitment of the folks we have in our organization. It is a top priority and one of the things that we have used to establish ourselves in the market and grow our business. Our goal has been to get in, get a project with a company, and then prove ourselves, in terms of both the quality of the technology and how we support them as they build out that solution and really make sure it works effectively for their needs.
CEOCFO: Would you tell us about the AER2100 router that was recently released?
Mr. Mulhern: That is definitely an exciting platform for us going forward and a leading edge solution especially in terms of things like WAN-Diversity and Multi-WAN optimization. We are finding that there are more and more demands for bandwidth at the edge of the network today. And an increasing need to match applications with the specific characteristics of the WAN alternatives. An example would be in a retail space with wireless LAN solutions collecting all kinds of customer information, data and analytics that they are using to help drive greater top line revenue. Those analytics have to get back up in their cloud somehow. That is putting a lot of pressure on the WAN connectivity. The AER 2100 platform is one of the most advanced platforms in terms of being able to handle multi-WANs simultaneously and then using our cloud technology for policy management. You are able to determine what information or data should go over what channel and over what period of time, and really optimize the performance of your network.
CEOCFO: CradlePoint is a global leader with a far reach. Are there areas of the globe where you would like to have a greater presence in the upcoming year or so?
Mr. Mulhern: Yes, I think one of the places you are going to see us investing more in 2014 is in Europe. We gained much of our market lead by being the first on 4G LTE here in the US and in North American. LTE is catching on faster than people had anticipated in Europe right now. You will see us doubling down our investments over there in 2014. We have a few other geographic targets we are watching and will enter as LTE rolls out worldwide, but I would say that Europe will be the focus for expansion in 2014.
CEOCFO: How is business these days?
Mr. Mulhern: Business is great and is growing rapidly. We are profitable and investing heavily in our technology and our team. What is more exciting is that we believe we are at the front end of this opportunity. Enterprise customers are just waking up to the power of 4G LTE and what that can do for them in terms of creating new flexibility and new network architectures. It ranges from customers using 4G wireless as a back up (or failover) solution for when their wired networks go down to cutting the cord completely and going all wireless. We are seeing tremendous interest and growth in using 4G LTE for isolated or parallel networks for security reasons. For example, why give your 3rd party HVAC vendors access to the corporate network. Put them on an entirely separate network using 4G. It is a very exciting time. It is very early in the market and we are positioned well to continue to grow as long as we continue to support and meet our customer’s needs. This is a new and emerging area and in emerging markets, new leaders emerge. We intend to be one of those. We really see an opportunity to become a major player in distributed enterprise networking.
CEOCFO: You worked with NORADworked with NNORADOOOON this year on the Santa Claus tracking project. Was that something new for you and how did that come about?
Mr. Mulhern: That is something we have done for a number of years with Verizon and NORAD. It is interesting because it actually is a good example of the isolated networks I was just mentioning. For security reasons, NORAD didn’t want the Santa tracking application on their national defense network so they ran separate networks and used 4G to do that. We have enterprise customers doing exactly the same thing. A large home improvement chain wanted an employee network for their HR and training material. However, they did not want to put employees on their point-of-sale network. They are running that whole network off 4G and we are seeing more examples of people using these separate, isolated networks for security reasons.
CEOCFO: What is next?
Mr. Mulhern: As I said, we are on the front end of this major transition that is going on in the market today. For us, we really see an opportunity to continue to build out a set of services around our offerings that help our customers drive more rapid growth and be more efficient on the bottom line. We are going to be investing more in our cloud platform both in terms of our own services and applications, but also enabling a set of partners to provide solutions to our customers. An example of one we are introducing next quarter is a PCI Compliance application for our retail customers. It will run out of our cloud platform and enable them to very simply and in real-time, manage their PCI compliance requirements across all their distributed locations. We have a number of applications and services like that we are rolling out.
CEOCFO: What surprised you personally as the company has grown and developed?
Mr. Mulhern: First of all what I am always grateful for, but not surprised by, is the kind of quality and commitment our employees have to our customers and that’s what is setting us apart in the market. I think what has surprised me is how quickly people are starting to embrace this 4G LTE space. Many times these transitions take longer than the pundits predict. However, once they start to happen, they happen much more rapidly than folks expect. I think that we are really seeing that opportunity unfold in front of us. It is a little surprising, but I think it is something for which we are certainly ready.
CEOCFO: Why does CradlePoint stand out as an exceptional company?
It starts with a real
commitment to our customers’ satisfaction in making sure our solutions work
for them in their environment. The reason we have that customer satisfaction
is that we have exceptional employees. Employees that really want to make a
contribution and want to make a difference. And of course, we are very
innovative in terms of turning the 3G/4G network into a very reliable, high
performance network for our customers.
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