As part of the Real World Windows Azure series, we connected with Craig Knighton, Vice President of Product Development and Technology Operations at LiquidSpace to learn more about how the company avoided $750,000 in first-year costs and minimized IT management time with Windows Azure.  Read LiquidSpace’s success story here. Read on to find out what he had to say.

Himanshu Kumar Singh: Tell me about LiquidSpace.

Craig Knighton: Our opportunity is based on the rapidly swelling ranks of mobile professionals and the new needs they bring to the marketplace. Many are entrepreneurs themselves; others are managers or executives at their companies. Either way, one thing that almost all mobile workers need is a place to work—a place besides their primary places of business, which, often, are their primary places of residence as well. Founded March 2010, LiquidSpace links broad-based lists of facilities in any given area with mobile workers who are in that area at the moment when they decide they need a space. Then, we make the search, booking, and even check-in processes for those facilities quick and seamless.

HKS: What were your first steps in starting the company?

CK:  We gave ourselves just one month to stand up a proof of concept, given the rapidly moving and highly competitive startup space and the need to attract investor funding as soon as possible. To stand up that proof of concept equally quickly, we decided to host it on the Amazon Elastic Compute Cloud (EC2) platform. The proof of concept was successful enough to win us venture capital funding for the company.  

HKS:  Once you got funding, what were your next steps?

CK: The next stop was to build out the solution so we could go live with a public beta. That put the choices for the application technology and the hosting platform back into play. With Amazon, we had to manage our cloud-based network infrastructure and update the server operating system software on our own. And we would have had to hire an IT manager—burning through about US$125,000 of its venture funding each year—to tend it all. That was out of the question. Building and staffing our own datacenter would have been even more expensive.

HKS:  How did you decide on Windows Azure?

CK: We looked at Google Apps—which we dismissed because of the need to learn a new system—and Windows Azure. With Windows Azure, we would get not only an infrastructure as a service, as we did with Amazon, but a complete, fully managed platform as a service. Additionally, we wanted to develop in Microsoft technologies because we were most familiar with them, and because we knew they’d be the fastest way to get to a good prototype.

A lot of startups choose MySQL on Amazon. But when we added management costs to the equation, we found SQL Server on Windows Azure was cheaper. Microsoft has completely changed the economics of the cloud.

HKS: What were the advantages of joining BizSpark?

CK: Had we chosen to build and staff a datacenter, we would likely have spent about US$250,000 on hardware and software licensing, and another $500,000 in annual staffing, for a total first-year expense of $750,000. A year on Amazon EC2, plus at least one technician to manage the infrastructure, would have been about $100,000.

In contrast, as a BizSpark member, we received no-cost and discounted licenses for Windows Azure, plus no-cost licenses for tools and production-use server software. And we avoided dedicated IT staffing costs. Time is money, as the old saying goes. We save both with Windows Azure and BizSpark.

HKS:  What are your estimated savings with Windows Azure and BizSpark?

CK: I estimate that we saved about $90,000 in first-year expenses—90 percent—compared to Amazon. We’re a startup; we were cash-strapped. Microsoft delivered a clear economic benefit—in the short run, we developed for free. We got off the ground quickly, at no cost. Microsoft took the cost of hosting completely off the table.

HKS:  Any other benefits?

CK:  Money isn’t the only thing that we save with Windows Azure and BizSpark. We also save the next best thing: time. Instead of needing a full-time IT manager, I can manage the Windows Azure environment with just 5 percent of my time. When we adopted Microsoft tools, we automatically adopted Microsoft best practices for managing deployment to a farm. We didn’t have to take the time or trouble to engineer these processes for ourselves. For startups like us, which are always pressed for time, that’s a real help.

Read how others are using Windows Azure.