15
Door to the Data Center is too Small Looking back at a year and a half of moving to the cloud September 2012 Jessvin Thomas Vice President, Blackstone

Door to the data center is too small

Embed Size (px)

Citation preview

Page 1: Door to the data center is too small

Door to the Data Center is too Small Looking back at a year and a half of moving to the cloud

September 2012

Jessvin Thomas Vice President, Blackstone

Page 2: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 2

Background  

IT  Security  (FW,  IDS,  Vuln  Mgmt  …)  4  years  Web  Opera?ons  Business  4  years  Director  Cloud,  Automa?on,  Tools  

7  days  Vice  President  of  ???  

Focused  on  Security  to  Start  Going  to  Cloud?    

…  Depends  on  how  you  define  cloud  

Show  of  Hands  How  many  deployed  to  Cloud?  

How  many  deployed  to  Private  Cloud?  How  many  fully  automate  configura?on?  

Page 3: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 3

Rewind  2  Years  (Nokia):    Door  to  the  Data  Center  is  too  small!  

We  just  can’t  seem  to  rack  servers  fast  enough  Weeks  to  get  anything  done  

Our  cost/server  is  well  above  average  Our  server/admin  ra?o  sucks  

How  Can  this  be?  We’re  not  total  idiots  

Maybe  the  door  to  the  data  center  is  too  small  

Page 4: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 4

To  the  Cloud!  

Minimized  variables:  •  Cloud  from  our  Service  Provider  (not  AWS)  •  Latency  to  physical  servers  low  (same  DC)  •  3  Tier  Architecture,  similar  to  physical  footprints  •  Nego?ated  SLA  for  up?me  of  underlying  

infrastructure    Security  •  Heavy  nego?a?on  on  ability  to  run  scans,  hypervisor  

aVacks,  ability  to  look  at  the  data  •  Comes  with  simple  firewall,  3  Tier  architecture  •  Hypervisor  isola?on  technology    Started  Small  •  Team  of  3  Planned  to  Grow  to  14  •  First  App:  Single  server  running  in  a  lab  doing  offline  

analy?cs    

Page 5: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 5

Failing  Forward  

Big  Success!!!  •  300  Servers  in  3  Months  •  300  Servers  /  3  Admins  •  Good  rela?onship  with  Developers      Big  Failure!!!  •  Only  3  Apps  launched  •  Frustra?on  from  developers  •  Limited  monitoring  •  One  opera?onal  issue  •  Team  is  bored  

Page 6: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 6

What  Went  Wrong??  

Familiar  ways  of  doing  things  ≠Standards  •  Without  Standards,  a  Process  is  not  Repeatable  •  Without  Repeatability,  a  Process  is  not  Automatable  •  Without  Automa?on,  Cloud  is  just  a  bunch  of  VMs    

Monitoring  

Access  Control  

OS  Provisioning  

Deploying  in  the  Data  Center  Old  skool  style  

The  old    ways  of  doing  things  did  not  work  in  the  cloud  

Page 7: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 7

Even  if  your  tools  are  good…Scale  Changes  Everything  

Just by looking

Draw a line with pencil

Algorithm

How  Would  You  Solve  these  Problems?  

Page 8: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 8

Needed  to  Rethink  how  we  Managed  Deployments  

Easy  to  User  Experience  &  Self  Service  •  Don’t  just  work  around  the  Last  Mile  Problems  •  No  small  Manual  Steps/?ckets  •  Dashboard  -­‐  one  place  to  see  things  •  End  to  End  Visibility  •  Keep  it  simple!!                          Fast  Provisioning  •  Automated  Tes?ng  &  Capable  of  regressions  •  Versioned  for  Rollback  capability  •  Same  characteris?cs  in  all  environments    INTEGRATED/COMES  WITH              •  Monitoring  •  Logging  •  Analy?cs  •  Real  Time  monitoring  •  Security      

Page 9: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 9

Success  Factors  

Availability:    Focus  on  surviving  failures  not  preven?ng  them  Automa`on:    Data  Center  automa?on  complexity  moving  from  scrip?ng  to  code  Skills:      Sys  admins  becoming  programmers  Culture:      Development  and  Ops  becoming  must  closer  together  (DevOps)  Tes`ng:      Infrastructure  tes?ng  starts  even  at  development.      Change  Speed:    Move  from  Dev  à  Prod  <  24  hrs  Focus:      The  app  can  do  more,  don’t  just  depend  on  the  “network”  

Page 10: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 10

Expect  the  Hype  Curve  

Early  Adopters  Wow,  I  can  get  machines  FAST!!  

 I  love  Calling  the  REST  API  

Automa?on  is  a  pain  What  is  this  git  thing?  

Can’t  you  just  give  me  an  SSH  prompt?  

The  Hello  World  Example  helped  I  get  SSH  prompt  for  Development  

Page 11: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 11

Cannot  Emphasize  enough:  Culture  &  Right  Skills  

•  Smaller  Teams  •  Higher  skilled  •  Learn  to  code!  •  Not  script,  code  

•  Source  Control  •  Tes?ng  •  Packaging  

       

Page 12: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 12

We are dedicated to driving outstanding results for investors and clients by deploying capital

and ideas that help businesses succeed and grow.

What  does  this  mean  for  Blackstone?  

Page 13: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 13

By leveraging the perspective, expertise, global relationships and market insights of our five businesses, we see opportunities that others don’t.

Blackstone  Overview  

$51 billion AUM

 Our  GSO  credit  plagorm  is  one  of  the  world’s  largest  credit-­‐oriented  alterna?ve  asset  managers,  known  for  providing  crea?ve  capital  solu?ons  for  issuers  across  various  strategies.  GSO  focuses  on  superior  risk  adjusted  returns  with  strong  emphasis  on  capital  preserva?on.  

$1.8 trillion  Of  corporate  advisory  transac?ons,  liabili?es  restructured  and  funds  raised  by  Park  Hill  placement  agent.  Blackstone  is  a  leading  independent  provider  of  advisory  services  to  companies  and  governments,  with  exper?se  in  strategic  transac?ons  and  complex  restructurings.  

$43 billion AUM  BAAM  is  a  creator  of  customized  investment  solu?ons  to  help  investors  preserve  their  assets  by  hedging  against  a  range  of  exposures.  

$50 billion AUM  The  world's  premier  opportunis?c  real  estate  investor,  with  a  focus  on  crea?ng  value  for  commercial  proper?es.  

$47 billion AUM  Global  leader  dedicated    to  inves?ng  growth  capital  and  opera?onal  exper?se    to  build  the  value  of  businesses,  ojen  previously  distressed.  Current  Porgolio  of  74  companies  with  $117  billion  in  combined  annual  revenue.    

Private Equity Real Estate Hedge Fund

Solutions Credit Financial Advisory

Page 14: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 14

The  preceding  materials  are  provided  as  an  overview  of  The  Blackstone  Group  and  are  not   intended  as  a  solicita?on  of   interest   in  any  par?cular  Blackstone  fund  or  strategy.    Each  Blackstone   fund  has  different   investment  guidelines,   risk  profiles  and  performance  history  and   such  performance  history   is  not   indica?ve  of   future   results  of  any  Blackstone   fund.    Materials  for  each  Blackstone  fund  will  be  provided  upon  request.    

The  materials  contained  herein  are  for  informa?onal  purposes  only  and  do  not  cons?tute  an  offer  to  sell  or  a  solicita?on  of  an  offer  to  purchase  any  interest  in  any  investment    vehicles   (the   “Blackstone   Funds”)  managed   by   Blackstone.     Any   such   offer   or   solicita?on   shall   be  made   only   pursuant   to   the   confiden?al   private   placement  memorandum   for   a  Blackstone  Fund   (“PPM”),  which  qualifies   in   its  en?rety   the   informa?on  set   forth  herein  and  contains  a  descrip?on  of   the   risks  of   inves?ng.    These  materials  are  also  qualified  by  reference  to  the  governing  documents  and  the  subscrip?on  agreement  rela?ng  to  the  relevant  Blackstone  Fund  (collec?vely,  the  “Agreements”).    The  PPM  and  Agreements    rela?ng  to  a  Blackstone  Fund  should  be  reviewed  carefully  prior  to  an  investment  in  that  Fund.    The  Blackstone  Funds  are  specula?ve  and  involve  a  high  degree  of  risk.  

In  considering   investment  performance   informa?on  contained   in  this  presenta?on,  prospec?ve   investors  should  bear   in  mind  that  past  performance   is  not  necessarily   indica?ve  of  future  results  and  there  can  be  no  assurance  that  the  Fund  and  Blackstone  Funds  will  achieve  comparable  results.  Actual  realized  value  of  currently  unrealized  investments  will    depend  on,  among  other  factors,  future  opera?ng  results,  the  value  of  the  assets  and  market  condi?ons  at  the  ?me  of  disposi?on,  any  related  transac?on  costs  and  the  ?ming  and  manner   of   sale,   all   of  which  may   differ   from   the   assump?ons   and   circumstances   on  which   the   current   unrealized   valua?ons   are   based.   Accordingly,   the   actual   realized   values   of  unrealized  investments  may  differ  materially  from  the  values  indicated  herein.  

An  investment  in  a  Blackstone  fund  (the  “Fund”)  involves  a  high  degree  of  risk.  The  following  is  a  summary  of  only  certain  considera?ons  and  is  qualified  in  its  en?rety  by  the  more  detailed  “Risk  Factors  and  Poten?al  Conflicts  of  Interest”  set  forth  in  the  applicable  Private  Placement  Memorandum.  Capitalized  terms  used  below  have  the  meanings  set  forth  in    the  Private  Placement  Memorandum,  which  must  be  read  carefully  prior  to  inves?ng  in  the  Fund.  

No  Assurance  of  Investment  Return.  There  can  be  no  assurance  that  the  Fund’s  objec?ves  will  be  achieved  or  that  a  Limited  Partner  will  receive  any  distribu?on  from  the  Fund.  An  investment  should  only  be  considered  by  persons  who  can  afford  a  loss  of  their  en?re  investment.  Past  ac?vi?es  of  investment  en??es  sponsored  by  Blackstone  provide  no  assurance  of  future  results.  

Leveraged   Investments.   Certain   assets   in  which   the   Fund  will   invest   are   expected   to   employ   significant   leverage.   The   leveraged   capital   structure  of   such   assets  will   increase   their  exposure  to  certain  factors  such  as  rising  interest  rates,  downturns  in  the  economy,  or  deteriora?on  in  the  financial  condi?on  of  such  assets  or  industry.  In  the  event  an  asset  cannot  generate  adequate  cash  flow  to  meet  its  debt  service,  the  Fund  will  suffer  a  par?al  or  total  loss  of  capital  invested  in  the  asset,  which  would  adversely  affect  the  returns  of  the  Fund.  

No  Market  for  Limited  Partnership  Interests  and  Restric?ons  on  Transfer.  Interests  in  the  Fund  have  not  been  registered  under  the  securi?es  laws  of  any  jurisdic?on,  and,  therefore,  cannot  be  sold  unless  they  are  subsequently  registered  under  applicable  securi?es  laws  or  an  exemp?on  from  registra?on  is  available.  There  is  no  public  market  for  Interests   in   the  Fund  and  one   is  not  expected  develop.  A   Limited  Partner  will   generally  not  be  permiVed   to  assign,   sell,   exchange,  or   transfer   its   Interest   in   the  Fund  without   the  consent  of  the  General  Partner  (which  consent  may  not  be  unreasonably  withheld).  

Failure  to  Make  Payments.  In  the  case  of  a  private  equity  fund,  if  a  Limited  Partner  fails  to  pay  when  due  installments  of  its  capital  commitment  or  its  por?on  of  Management  Fees,  Organiza?on  Expenses  or  other  obliga?ons  to  the  Fund,  such  Limited  Partner  will  be  subject  to  various  remedies  including,  without  limita?on,  preclusion  from  further  investment  in  the  Fund,  reduc?on  in  its  capital  or  loan  account  balance,  and  a  forced  sale  of  its  Interest  in  the  Fund.  

Highly  Compe??ve  Market  for  Investment  Opportuni?es.  The  ac?vity  of  iden?fying,  comple?ng  and  realizing  aVrac?ve  investments  is  highly  compe??ve  and  involves  a  high    degree  of  uncertainty.  There  can  be  no  assurance  that  the  Fund  will  be  able  to  locate,  consummate  and  exit  investments  that  sa?sfy  the  Fund’s  rate  of  return  objec?ves  or  realize    upon  their  values  or  that  it  will  be  able  to  invest  fully  its  commiVed  capital.  

Important  Disclosures  

Page 15: Door to the data center is too small

184    0    92   102    0    70  0    152    195   99    206    202   201    221    3  0    103    120   0    115    99  0    171    146  

Blackstone 15

Important  Disclosures,  con`nued  

Reliance  on  the  General  Partner  and  the   Investor  Advisor.  The  success  of   the  Fund  will  depend   in  part  upon  the  skill  and  exper?se  of   the  professionals  of   the  Fund’s   investment  advisor   and   General   Partner.   The   interests   of   these   professionals   in   the   General   Partner   and   the   Investment   Advisor   should   tend   to   discourage   them   from  withdrawing   from  par?cipa?on  in  the  Fund’s  investment  ac?vi?es.  However,  there  can  be  no  assurance  that  such  professionals  will  con?nue  to  be  associated  with  the  Investment  Advisor  or    General  Partner  throughout  the  life  of  the  Fund.  

Private  Equity  and  Real  Estate  Net  returns  for  Private  Equity  funds  and  Real  Estate  global  funds  shown  for  realized  /  par?ally  realized  investments  and  total  investments.  Incep?on  of  the  Real  Estate  business  was  January  1992  and  incep?on  of  the  Private  Equity  business  was  October  1987.  

S&P  500  Annual  Return  has  been  calculated  as  the  internal  rate  of  return  of  the  total  contribu?ons  and  distribu?ons  (including  fees,  drawdown  of  expenses,  return  of  capital  and  recouped  losses),  and  the  corresponding  annual  rate  of  return  of  the  S&P  500  Index  from  each  contribu?on  /  disposi?on  date  to  the  quarter  end  for  all  investments.  S&P  500  Annual  Rate  of  Return  is  provided  solely  as  an  indica?on  of  returns  that  could  be  earned  by  investors  by  making  similar  investments  in  the  S&P  500  Index.  Blackstone’s  funds  differ  from  the  S&P  500  Index  in  that,  among  other  factors,  Blackstone’s  funds  are  ac?vely  managed  en??es  that  bear  fees  and  use  leverage.    

The  NCREIF-­‐ODCE  (NCREIF  Fund  Index  -­‐  Open-­‐End  Diversified  Core  Equity),  which  began  in  1973,  is  a  fund-­‐level  capitaliza?on  weighted,  ?me-­‐weighted  return  index  that  consists  of    28  open-­‐ended  core  funds.  The  average  index  leverage  is  approximately  30%  and  includes  property  investments  at  ownership  share,  cash  balances  and  leverage.  NCREIF-­‐  ODCE’s  returns  are  reported  on  a  quarterly  basis.  NCREIF-­‐ODCE’s  net  annual  rate  of  return  is  provided  solely  as  an  indica?on  of  returns  that  could  be  earned  by  investors  making  real  estate  investments.  Blackstone’s  funds  differ  from  the  NCREIF-­‐ODCE  Index  for  several  factors.  

Hedge  Fund  Solu`ons  BAAM  Net  Composite  covers  the  period  from  January  2000  to  present,  although  BAAM’s  incep?on  date  is  September  1990.  Past  performance  is  not  indica?ve  of   future  results  and  there   is  no  assurance  that  any  BAAM  fund  will  achieve   its  objec?ves  or  avoid  significant   losses.  The  BAAM  Composite   is   the  asset-­‐weighted  performance  of  BAAM’s  investments  net  of  all  fees  (both  BAAM  and  underlying  manager).  The  Composite  excludes  BAAM  managed  funds  (1)  that  employ  a  long-­‐biased  commodity  strategy,  a  long-­‐only   equity   strategy   or   a   strategic   opportuni?es   strategy;   (2)  whose   primary   objec?ve   is   to   provide   capital   to   start-­‐up   hedge   fund   firms;   and   (3)   that   are  managed   under   non-­‐discre?onary  advisory  arrangements  (details  of  the  performance  of  all  BAAM  funds  are  available  upon  request).  

The  vola?lity  of  the  indices  presented  may  be  materially  different  from  that  of  the  performance  of  the  Funds.   In  addi?on,  the  indices  employ  different   investment  guidelines  and  criteria   than  the  Funds;  as  a   result,   the  holdings   in   the  Funds  may  differ  significantly   from  the  securi?es   that  comprise   the   indices.  The  performance  of   the   indices  has  not  been  selected  to  represent  an  appropriate  benchmark  to  compare  to  the  performance  of  the  Funds,  but  rather  is  disclosed  to  allow  for  comparison  of  the  Funds’  performance  to  that    of  well-­‐known  and  widely  recognized  indices.  A  summary  of  the  investment  guidelines  for  the  indices  presented  are  available  upon  request.  In  the  case  of  equity  indices,  performance  of  the  indices  reflects  the  reinvestment  of  dividends.  

Credit  Credit  Net  Flagship  Mezzanine  Fund  return  reflects  net  combined  IRR  of  the  GSO  Capital  Opportuni?es  Fund  LP,  and  GSO  Capital  Opportuni?es  Fund  II  LP,  from  incep?on  of  the  first  GSO  Capital  Opportuni?es  Fund  in  July  2007  through  present.    Credit  Suisse  High  Yield  Index  is  an  unmanaged  market  value-­‐weighted  index  designed  to  mirror  the  investable  universe   of   the   U.S.   dollar-­‐denominated   high   yield   debt  market.   There   are   significant   differences   between   the   investments   of   the   Flagship  Mezzanine   Fund   and   the   index.   For  instance,  the  Flagship  Mezzanine  Fund  may  use  leverage  and  invest  in  investments  that  have  a  different  degree  of  risk  and  vola?lity,  as  well  as  less  liquidity,  than  those  investments    contained  in  the  index.  Moreover,  the  index  is  not  subject  to  any  management  fees,  performance  compensa?on  or  expenses.  It  should  not  be  assumed  that  the  Flagship  Mezzanine  Fund  will  invest  in  any  specific  investments  that  comprise  the  index,  nor  should  it  be  understood  to  mean  that  there  is  a  correla?on  between  the  Flagship  Mezzanine  Fund’s  returns  and  the  performance  of  the  index.  The  sta?s?cal  data  regarding  this  index  has  been  obtained  from  sources  believed  to  be  reliable.  It  is  not  possible  to  invest  in  this  index.  This  index  is  being  presented  for  comparison  purposes  only  to  show  how  the  Flagship  Mezzanine  Fund’s  performance  compares  to  the  broad  global  markets.  Further  informa?on  about  this  index  is  available  upon  request.