Fayetteville startup's chief says operation small, but thinking big

Lofty Labs executives (from left) Ben Davis, operations director, President Casey Kinsey and client service manager Rikki Marler hold an online meeting with a client.
Lofty Labs executives (from left) Ben Davis, operations director, President Casey Kinsey and client service manager Rikki Marler hold an online meeting with a client.

FAYETTEVILLE -- Casey Kinsey, president of Lofty Labs, never considered he'd be building a software development and data analytics company when he struck out on his own and began working as a freelance software consultant in 2014.

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Lofty Labs employees work at the company’s Fayetteville headquarters. Lofty Labs is the first and only Amazon Web Services consulting partner in Arkansas.

"In 2015, Lofty Labs had two employees, counting me," Kinsey said.

Since then, Lofty Labs has seen its employee count jump to eight full-time workers and expects to have 15 by the end of the year. Kinsey declined to give revenue numbers but said the company has seen strong sales growth and that it has no outside investment and isn't seeking any.

"We're still little but growth-oriented," Kinsey said.

Kinsey said the company's controlled, steady growth, along with its lack of outside influences, makes it different from a typical tech startup. He said Lofty Labs tries to meet each company's unique needs rather than offering a computing solution based on the client's specific industry.

Brett Amerine, chief operations officer at Fayetteville-based Startup Junkie, said Lofty Labs has a niche among Northwest Arkansas' digital companies, with a unique mix of Web development and software consulting along with expertise in analytics and big data.

Amerine said Lofty Labs' steady growth -- as a result of obtaining clients, rather than through outside investment -- added to the company's stability.

"It's a path that we recommend -- growing the business with customer money," Amerine said.

Lofty Lab's clients include the Public Broadcasting Service; WEHCO Media Inc., parent company of the Arkansas Democrat Gazette; and CBRE: United States Commercial Real Estate Services. The company also works with MondoBrain -- a machine-learning startup that does work for French companies such as Airbus and Peugeot.

"In a lot of ways we're a professional-services firm," Kinsey said. "Our success is real success."

The company's most recent claim to fame is that it became the first and only Amazon Web Services consulting partner in Arkansas. According to Amazon, the service is cloud-based and provides computing power, database storage and content delivery in a system that can grow as a business expands.

The Amazon Web Services Partner Network is made up of cloud software and service vendors that have met certain criteria to gain the endorsement from Amazon Web Services, according to the company's website. The network has two types of partners -- consulting and technology -- which are ranked through a tier system by their expertise in Amazon Web Services and customer engagement.

According to fourth-quarter data from Synergy Research Group released in February, Amazon Web Services has a dominant share of the public cloud services market at more than 40 percent. Amazon's three closest competitors -- Microsoft, Google and IBM -- have increased their worldwide share of the market by 5 percent over the last year, but combined still only control 23 percent of the public cloud market, according to Synergy Research.

"They power a massive swath of the internet and offer cost-effective and powerful solutions," Kinsey said of Amazon.

He said the target customer for the service is a business with 50 to 1,000 employees and $2 million to $250 million in revenue. He said using the Amazon system allows businesses to take advantage of the internet giant's existing infrastructure with no upfront costs. He said the Amazon system gives companies global reach.

In its simplest form, cloud computing is the process of using a network of remote servers accessed via the internet to store and process information, typically on a pay-for-use basis, instead of using a dedicated local server or a personal computer.

There are three types of cloud computing: public, private and hybrid. Public clouds are accessed through the internet and give companies access to things like storage or additional computing power on a pay-as-needed basis. Private clouds are owned by a single company, and hybrids use a mix of private and public clouds as needed.

According to the 2017 State of the Cloud Survey by RightScale, 85 percent of businesses use the hybrid, multi-cloud strategy, up from 82 percent in 2016. In the survey, 1,002 information-technology professionals -- 48 percent of whom worked at companies with more than 1,000 employees -- were asked about their adoption of cloud infrastructure and related technology.

In its most recent Worldwide Semiannual Public Cloud Services Spending Guide, released in January, market intelligence company International Data Corp. predicts worldwide spending on public cloud services will grow nearly 20 percent annually, six times greater than overall IT-spending growth. The guide indicates spending will go from $70 billion in 2015 to more than $141 billion in 2019.

According to the guide, large companies will be driving the growth in cloud computing with projected spending of $80 billion by 2019. Small- and medium-size businesses, companies with 500 employees or fewer, will make up 40 percent of worldwide spending.

"Industry-specific applications will be a driving force as businesses look for solutions that can be easily configured to their unique business and vertical requirements," said Eileen Smith, program director for customer insights and analysis at International Data Corp., in a news release.

Kinsey said his organization is focusing on building its client base and increasing sales as he begins to embrace his role as a company leader and learns to step away, somewhat reluctantly, from working on individual projects.

"I'm still in the nitty-gritty and good at getting in people's way," he said. "But it helps when you find the right people. They really take it over, and that makes my life easier."

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