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How's hiring going?
Well, we've only been able to hire 370 people. We have these big recruiting functions, and we're up to 17 full-time people in recruiting.
How many customers are you up to?
Well, we totally missized the business. Every customer is about five times the size of the original business plan in terms of revenue, complexity and so forth. As a result, none of our customers is smaller than the projections but the business is much bigger than the projections. We're just under 30 customers now.
What does that underestimation do to your provisioning plans?
We've had to procure more data center space, hardware, software and bandwidth than we originally anticipated. In our original plan, we had about 150 (employees) by this time. Marc (typically says], 'faster, faster, faster, bigger, bigger, bigger.' And he was saying, 'Ben, you're nuts, you're nuts, you're nuts: But it turns out the market has been pretty good lately.
How come you underestimated the demand so much?
We've actually grown faster than Netscape, which we thought was impossible.
I look at the growth rate of the market and I think,'I don't think I'm going to push to grow it any faster.' There are certain laws of physics . . . like with the speed of light: It's not just a good idea, it's the law. We're trying to maximize the number of happy, deployed customers. A customer that we make a commitment to that we can't keep doesn't give us anything. It only damages us.
We're constraining the growth, both of the [employee] head count and of our customer base. And it turns out there's a deeper context for why that makes sense in our business. Our business has a lot of similarities to a manufacturing business. We are manufacturing software capacity for large-scale Internet operations. [Organizational management expert W. Edwards] Deming said you don't have to make a )
LOUDCLOUD CHAIRMAN MARC ANDREESSEN AND CEO BEN HOROWITZ TALKED WITH CRN E-COMMERCE EDITOR AMY ROGERS ABOUT THE WEB INFRASTRUCTURE COMPANY'S FIRST YEAR> ITS BUSINESS PHILOSOPHY AND THE BOOMING DEMAND FOR SOFTWARE SERVICES. trade-off between quality and growth because you either have both or you have neither.
CRN_ Have you lost any customers?
HOROWITZ_ No. One of our customers...