Financing the cloud

Financing the cloud

How Extrinsica Global and Fusion Networks are taking advantage of Cisco Capital financing to build and grow their cloud portfolios.

Establishing a new business—or new product line, or new service offering—takes time. And it takes money. But what if those two limiting factors were removed, or at least mitigated? Wouldn’t that new organization or offering get off to a better start and have a greater chance to succeed?

That’s the assertion of Cisco Capital®, which offers asset-backed lending and financing options to Cisco customers and partners. And the innovative financier is betting heavily on the cloud.

“The cloud is a business model changer,” says Kristine A. Snow, president of Cisco Capital. “There’s significant opportunity for everyone, and we’re committed to helping.” 

Committed indeed. Cisco Capital has earmarked $1 billion for financial solutions that help accelerate the adoption of cloud technologies. These financing options allow customers and partners to preserve cash by removing onerous, upfront capital investments, while reducing the time and risk of cloud deployments.  

“TCO [total cost of ownership] and upfront investment are two of the biggest inhibitors of cloud adoption, and we help remove those barriers,” says Snow. “We believe in our customers and partners, and we believe in the transformative value of the cloud.”

 

Extrinsica Global: Genuine risk sharing 

Based in the United Kingdom, Extrinsica Global was delivering applications via the Internet before the cloud became a defined and meteoric trend. As bigger players and bigger opportunities came to the fore, company leaders realized a new strategy was needed.

“We needed a different model, and decided to build our own cloud infrastructure and cloud fabric,” says Simon Smith, chief executive for Extrinsica. “We had the experience, the knowledge, the strategy, and the potential customers. We just didn’t have the financial means.”

Enter Cisco Capital, which offered an innovative financing arrangement that includes leased equipment at a significant discount, £1 million of debt financing, and revenue sharing. Soon thereafter, Extrinsica received a “metric ton of Cisco® hardware” and quickly started building a robust cloud fabric that can deliver anything-as-a-service.

According to Smith, Extrinsica is now at the leading edge of what can be designed for and delivered through hybrid cloud environments, and customer demand is growing exponentially.

“Cisco has genuinely shared the risk with us,” Smith says. “They took a bet on us, and things have progressed astonishingly well.”

 

Fusion Networks: Meeting a deadline

A New Zealand-based systems integrator and networking services company, Fusion Networks wanted to grow its services portfolio and become a cloud provider. With government and enterprise customers being the prime target, company leaders knew they had to deliver the very best and highest quality cloud services.

“We had two options: tap a third-party cloud environment or build our own,” recalls Andrew Gurr, managing director for Fusion. “Building our own cloud was the only way we would have ultimate control over quality and the ability to adapt the environment over time. But that requires a lot of upfront cost.”

Cost wasn’t the only concern. Fusion had won a large enterprise contract for cloud services, which required those services to be in production within three months.

Cisco Capital jumped at the opportunity, says Gurr, financing a full cloud infrastructure in a “lease-to-own” model. Instead of a prohibitive, lump-sum payment, Fusion is paying for the equipment—and Cisco SMARTnet Service, which helps with infrastructure maintenance and quality management—over 36 months.

“Cisco was the only provider who understood our vision and potential from day one, and they moved very quickly,” says Gurr. “We were surprised by their level of comfort in taking on the risk, being relaxed with the partnership, and trusting our business. We’ve been thrilled with our relationship with Cisco Capital.”

Fusion’s cloud business went live in April 2014, and more than doubled in the first year. By preserving cash, the company was able to hire nine additional staff members to help support the influx of new clients.

“We are open for business,” says Snow. “Anyone wanting to adopt Cisco cloud technologies or advance their cloud capabilities should contact us. We have flexible financing options and tailored financial solutions that can help across the Cisco cloud portfolio.”

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