Lance Crosby and the trouble with a successful exit

The email subject line was “Time to Go.” In 2005, Lance Crosby invited colleagues to breakfast to discuss leaving their hosting company and building something of their own. It was a short invitation with a potentially expensive sequel. SoftLayer would eventually become part of IBM’s cloud business in a deal worth about $2 billion. At breakfast, there was still the matter of making it work.

The customer problem was easy to recognize. Getting computing capacity involved too much waiting and too many arrangements. Crosby’s proposed company would prepare the infrastructure in advance, then let customers obtain what they needed quickly. The appeal was practical: spend less time arranging a server and more time using it. A great deal of the cloud’s future fitted inside that unglamorous improvement.

Then came the stranger decision. After the sale, after working inside IBM, Crosby left and started again. His next company, StackPath, would try to bring security into the same world of automated, rapidly expanding infrastructure. The first company’s exit helped make the second company’s entrance possible. The two businesses would have very different endings.

The breakfast before the cloud

Crosby later placed the founding conversation at Mama’s Daughters’ Diner on Irving Boulevard in Dallas, on May 5, 2005. He remembered a proposal for hosting without long contracts or custom equipment, available when a customer wanted it, paid for with a credit card. SoftLayer’s service went live in January 2006. Between the conversation and the launch lay the less photogenic business of turning a shared complaint into working infrastructure.

There is something revealing about that origin. The founders already knew the trade. They were leaving an existing hosting operation, carrying an understanding of what customers asked for and what it took to deliver. Their starting material included frustration, but also experience. They could see which parts of the process might be prepared, standardized and automated.

The founding story has the advantage of a diner. Infrastructure generally gets fluorescent lighting and a procurement form. A breakfast table gives the decision a human scale: colleagues agreeing that they would rather spend their days building a different system. Customers would eventually encounter the result through an ordering interface. Before that, people had to agree to leave their jobs.

A business education, with cables attached

Crosby came to that table with an operating career behind him. Before SoftLayer, he had spent five years as chief operating officer of The Planet. His responsibilities stretched across sales, provisioning, engineering, product selection, information security, business development and legal work. Earlier management roles at Catalog.com and Dallas Internet placed him inside the business before cloud became its familiar shorthand.

His education crosses a similar spread of disciplines. He earned business and finance degrees at Tarleton State University, including an MBA and a master’s in finance, and a law degree at Texas Wesleyan. The Texas Bar records his admission in May 2001. For someone buying equipment, negotiating agreements and raising capital, there were several ways to put that education to work.

SoftLayer also revisited his professional past. GI Partners acquired the business in 2010 and merged it with The Planet. The company he had helped leave and the company he had helped create became part of the same operation. Corporate history occasionally enjoys a joke that would be difficult to get through a novelist’s editor.

The buyer was IBM

By the time IBM announced its acquisition agreement in June 2013, SoftLayer had 13 data centers and served about 21,000 customers across 140 countries. Its platform combined physical and virtual servers, giving customers choices about how their workloads ran. Those details explain why a business with a cheerful name attracted a buyer whose name already occupied several shelves of computing history.

IBM wanted to bring SoftLayer together with its existing SmartCloud business. The attraction included speed and simplicity, alongside the ability to serve companies already building for the internet. SoftLayer supplied a way of obtaining and managing infrastructure that IBM could offer to a much wider enterprise audience.

Crosby stayed after the acquisition. In July 2014, IBM was announcing new enterprise customers and additional services based on SoftLayer infrastructure. The company was being used for businesses well beyond the original startup audience, including established names such as Macy’s and Whirlpool. A hosting idea developed in Dallas had become part of a corporate cloud strategy.

That would have made a serviceable final chapter. Crosby had an alternative in mind. He left IBM in 2015, having spent time observing what happened when infrastructure became easier to create than to protect. The next problem had been arriving alongside the success of the first.

Another table, another proposition

For StackPath, Crosby recalled gathering the founders at Fat Rabbit on McKinney in Dallas. He warned that his proposal would sound unreasonable: build a security company capable of fixing the internet. The scale of the statement was considerable. So was the persuasion required to get other people to work on it.

“The main strategy I use is curiosity.”

Lance Crosby, on persuading people to consider new technologies, 2017

StackPath was founded in 2015 and emerged publicly in July 2016. It arrived with existing technologies and customers through acquisitions, including MaxCDN, Fireblade and Cloak. Content delivery, a web application firewall and a virtual private network offered different pieces of the proposed service. The work ahead included bringing those pieces into a coherent platform.

The founding team also brought experience from other infrastructure companies. Andrew Higginbotham had led cloud and technology work at CenturyLink. Kim Sheehy had been CFO at CyrusOne. Crosby’s next venture required people who understood how to run and finance services customers would depend on every day.

The developer was central to the pitch. Crosby described customers creating large numbers of virtual machines while conventional security struggled to follow the automation. StackPath aimed to let developers call security services through software interfaces. Protection would become something an application could request as it grew, with less dependence on a separate sequence of manual arrangements.

The internet still has geography

Crosby’s security argument led him toward content delivery. A network delivering material to users occupies a useful position from which to observe and protect traffic. In his 2017 explanation of the business, he described starting with that network and building security around it. Delivery and protection would share a place in the path between an application and its audience.

Over time, the proposition widened into edge computing: running work closer to the people or devices requesting it. In his writing, Crosby described computing as a recurring movement between concentration and distribution. Large central systems gather the work; new demands create reasons to move some of it outward again. StackPath was his investment in that outward movement.

For Crosby, the idea involved very specific buildings. In 2018, StackPath was deploying equipment in facilities hosting internet exchanges, where networks meet. Its plans then extended toward smaller facilities near cellular towers. There were racks to fit, power limits to respect and cities to select. The edge acquired a rather concrete shape when someone had to pay to install it.

His attention to hardware constraints made the pitch more interesting than a promise of speed. A deployment needed to fit into available facilities without expensive special treatment. An application also needed a reason to run there. Moving work closer could help only when the placement addressed something the customer actually needed.

Knowing when to give someone else the room

Crosby’s public advice about hiring is pleasingly economical: employ people smarter than yourself. The implication suits a career spanning finance, contracts, networks and software. A founder can understand a system without being its strongest specialist in every part. Giving colleagues room to know more becomes an operating necessity.

He also gave his family a place in the account of his career, crediting his wife and children as participants in his success. His public persona could accommodate both a pitch about changing internet infrastructure and a digression about armadillos. In his Dallas founding essay, he made room for several of the animals’ peculiarities. Even cloud computing could apparently use an occasional change of subject.

Recognition followed the companies. Crosby received regional EY entrepreneurship awards in 2011 and 2018, and was included in D CEO’s Dallas 500 for 2020. By March 2020, StackPath announced that its total equity funding had reached $396 million, with Juniper Networks and Cox Communications leading its Series B. The ambition had attracted partners with substantial interests in networks and connectivity.

The ending belongs in the story

The leadership changed that year. Crosby moved out of the CEO role and was listed as chief innovation officer. Christopher “Kip” Turco took the chief executive position. That sequence matters when following a founder across a company’s entire life: his founding role and its later operating leadership belong on a dated timeline.

In March 2024, Gcore announced that it had acquired StackPath’s web application and API protection technology. In June, StackPath told customers it was closing its products and liquidating assets for creditors. Customers were urged to move their services and copy their data away. A company built to carry other businesses’ traffic was asking them to arrange another route.

Some of the technology continued elsewhere. The company itself closed. Both facts belong beside the financing, the acquisitions and the original plan. They give Crosby’s career its uneven shape: a business that became part of IBM, followed by one whose independent operation ended. The first success supplied experience and credibility. Building again still meant accepting an uncertain result.

The breakfast invitation remains a good place to begin. It captures a decision made before anyone could know the ending. Crosby’s career is most revealing when it stays there for a moment, among the people who understood the work and agreed to try. The cloud could be ordered on demand. The outcome never came with that convenience.