Nelson Nahum – Founder & CEO, Zadara Storage

Nelson Nahum brings over twenty years of experience in the storage industry. He is known for creating innovative products and successfully bringing them to the market. Prior to co-founding Zadara Storage, he was a Fellow and Vice President of Software Engineering at LSI Corporation, where he was responsible for an engineering team of over 250 people. Previously, he was Co-Founder and CTO of StoreAge Networking Technologies, which was acquired by LSI in 2006. At StoreAge, he invented the out-of-band storage virtualization system, which led to a successful product that was adopted by HP and led to the acquisition of StoreAge by LSI. Nelson holds multiple patents related to storage systems. He has a BScEE from the Technion, the Israeli Institute of Technology.

Tell me about your early career.
I started my career as a software engineer and my first project was to develop software to diagnose and test disk drives, back in the days when there were special labs that could fix failed disk drives. Very quickly, I got promoted to develop the firmware for an AS/400 compatible Disk Array (called DASD by IBM). Since the beginning, most of my career has been involved with storage – first as a developer, then as a team lead, R&D manager, to founder of companies.

How did the concept for Zadara Storage come about?
I’ve been working in enterprise storage my whole career, but when I started looking at the AWS cloud, I thought there was a great opportunity to change the game of enterprise storage. Instead of building monolithic storage arrays that cost a lot of money to buy (Capex) and also to manage (Opex), we created an enterprise storage service that has the security, performance, data protection, and manageability of monolithic arrays, but also with the elasticity fully-managed and all the good things of the “as a service” model, even when it is on premise, at the customer site. Our software creates a cloud storage solution that is unique in the way that we separate the different tenants and workloads into a multi-tenant cloud. In our case, every tenant has the same capabilities as they would have with dedicated storage arrays but totally as a service. When you bring a new and unique technology, it is very powerful, but when you also bring a new business model, that is a game changer.

What was your marketing strategy?
Marketing is key for the success of a startup, otherwise nobody will know about your idea. In today’s world, in order to compete with the established companies with known brands and large marketing budgets, it is necessary to innovate in marketing all the time. We focused in the beginning on having good SEO for certain keywords and to generate enough content and distribution so people would know about Zadara. Most of our initial customers were enterprises, but they came to us. For example, our product is really good for people that need file storage in AWS, so we refined our messaging in such a way that anybody who searches for file storage in AWS will find us. It is very important to optimize organic search before you start spending a fortune in Google Ads. We always try to use the latest marketing techniques – the sooner you can use them the better because the big companies cannot move fast and this is where you can have an advantage.

How fast did the company grow during the first few years?
We launched our product eighteen months after starting the company. We saw immediately that this will be a hit based on the number and size of our beta customers. In the first year of sales, we sold $300,000. By the second year, we were at $2.2 million.

How do you define success?
Success for me is building a company where its employees, customers, and investors are happy and share the same vision. It is a three-legged stool. You cannot succeed without having all three legs. Over time, these three groups of people may have different interests but it is the job of the entrepreneur to align the three of them around the same vision and expand these groups as you grow.

What is the key to success?
First, build a really good team. Second, build a culture where customer satisfaction is a must. If the customers are happy, then it is a good base to start growing and attract the best talent and investors.

What is the greatest lesson you’ve ever learned?
The initial decisions at the beginning of the company are the ones that are harder to fix. The co-founders, business model, product, and initial investors are among those key decisions that are best to have right from the beginning.

What are some quotes that you live by?
“How to succeed? Think big.” “Better to be smart than right.” “It takes 100 smart people to solve a problem that a dumb person created.”

What are some of your favorite books?
I like Malcolm Gladwell’s books. David and Goliath is my favorite, but I also like The Tipping Point.

Tell me about one of the toughest days you’ve had as an entrepreneur.
The toughest part of this job is when you come to the conclusion that somebody you hired early on, and who did a good job for you in the very early days, is no longer capable of doing a good job during the company’s growth phase. It is easy to let go of somebody who hasn’t performed well, but it is very hard to let somebody go who believed in the vision and worked well early on, but became an obstacle for the company’s growth. Unfortunately, these tough decisions need to be made or else it can compromise the rest of the team who also believe in the vision and bet their careers on your success.

When faced with adversity, what pushes you to keep moving forward?
During adversity, it is always good to step back and look at the particular adversity and think that there are other things that can be much worse. Family and friends are the best possible support system. Fortunately, most of the problems in business are reversible (as opposed to health issues), so the best thing to do is to keep calm, stay healthy, and start thinking about how to reverse the problem, even if it takes time.

What advice would you give to young entrepreneurs?
Try to solve real problems and come up with a differentiated product. Even if many people don’t believe that this is the right thing to do, all you need is enough early adopters to get going. The early adopters should be the investors, new hires, and the first customers. If you succeeded to convince a handful of people that your idea is good, then it is probably good. Don’t be afraid to pivot if needed. New ideas typically require adjustments according to external feedback. And most importantly, don’t let the naysayers doubt your idea. Build a great team and focus on customer satisfaction.

This interview was conducted for research purposes by Jason Navallo for his upcoming book, Underdog.