I'm Ed Cowan and this is scaling up.

Never in my wildest dreams did I think it would be what it is today.

I've been training for 17 years for this moment and I've haven't done 10,000 hours.

I've done like 50,000 hours and I'm ready to go.

This is my Super Bowl, this is my time and and we're on.

This podcast aims to educate and inspire by telling the stories of great growth companies as told by their CE, OS and founders.

TDM is an Australian based investment firm that invests globally in fast growing public and private companies.

For more insights, visit our website tdmgrowthpartners.com.

Very rarely do you get to tell the story of a wildly successful entrepreneur that is largely unknown beyond the immediate circle of influence today on scaling up.

Greg Bora, the CEO and founder of CDC, formerly Canberra Data Centres, which is in some rarefied air among companies globally.

Having compounded earnings at over 30% for the last 15 years, It's now valued well in excess of $10 billion and is at the centre of the beating heart of Australia's critical infrastructure.

All this and it still has a massive growth runway ahead of it.

Greg's story in many ways is the CDC story.

From an aspiring cyclist and reluctant IT graduate.

Greg has become the face an often lead salesperson of a business that has rewritten industry standards as it relates to innovation and security.

In what is seen from the outside as a commoditized industry, CDC has thrived by listening to customer needs and adapting accordingly.

This is a story of initial hustle and belief in an opportunity, but ultimately it's about resiliency and delivering on promises.

Greg has undoubtedly built one of Australia's best businesses from the ground up and to hear him speak about this scaling journey with the knowledge and passion that he does will undoubtedly be inspiring to all our listeners.

I hope you enjoy the scaling story of CDC with it's CEO and founder Greg Bora.

Greg, welcome to scaling up.

I do find often the trouble with these incredible stories of great durable businesses that have been built over long periods of time is sometimes I don't actually really know where to start.

The founding story of CDC in many ways is your story.

And I thought probably the best place to start is to go back in time to your early 20s.

And at the time you had dreams of being an Olympic cyclist.

And you were well on your way to this until a fateful day when you were hit on your bike by a garbage truck.

And this made you reconsider your priorities.

So maybe we picked this up in the late 1990s.

We're in Newcastle, NSW and you reluctantly going to university to study at the time what was broadly named information technology.

Great, Well it's lovely to be here.

Thank you for your time as well.

I grew up in Newcastle, very much working class and certainly learned from my parents that, you know, the harder you work the luckier you get.

Didn't know what I wanted to do with my life and I was probably would have been diagnosed with ADHD and everything else as a kid because I had lots of energy and was in lots of trouble.

But yeah, I found cycling and road cycling, endurance track cycling, and I got right into that and was training 700 kilometres to 1000 kilometres a week as a kid and loving it.

I raced a little bit, was lucky enough to go overseas and race as an amateur in Europe and did OK.

Not great but OK.

And then I was training to go back the next year to race semi professionally.

And this is when I was about 20 years old and I was hit by a garbage truck on the on the freeway between the Central Coast and Newcastle.

And that changed the direction of my life.

Took me about 3 months to recover.

I was like I better do something with my life.

And all my mates were just finishing university and I said what do you think I should study?

And they said you should study something to do with computers.

I think computers might have something to do with the future, and I'd never turned on a computer in my life.

So mature age student enrolled in an information science degree, which is a sort of a combination of data science, computer science and, and business.

And off I went.

And it was the hardest thing I'd ever done in my life.

And I just applied all the discipline that I'd put into, you know, elite sport into study and performance.

And, and I was lucky enough to be on the Dean's merit list most years and finished at the top of the class.

And I finished university in 2000.

So lots and lots of job opportunities.

And because I'd finished at the top of the class, there was one opportunity, which was to work for a pan European data center operator as a graduate in Germany.

The company was called Integra GmbH and there's so much money floating around that should flew me to Berlin for a job interview.

Can you imagine?

And I did must have done pretty well because they offered me a job and I said to them, oh look, you know, I'm flattered but you know, thanks but no thanks.

Because, you know, deep down I was still a bit of a mummy's boy and lived at home and never really travelled much.

And, and I was just really nervous about living out of the country and learning new language and, and all those challenges.

And then my girlfriend at the time, soon to be my wife, she was an up and coming ex triathlete, got 4th at the World Championships and and she became very successful at at cycling.

So successfully in fact, that she's offered to race professionally for the number one team in the world based out of Rotterdam in Holland.

So, having turned down that job in Germany, did you go grovelling back?

So, you know, the mummy's boy gets back on the phone and rings up the company and says, oh, look, you know, I've had second thoughts.

I'm happy to take that job in Berlin.

And they said, oh, sorry, the job in Berlin is no longer available.

But we've got the same job in a little town called Bartonburg, which is just on the outskirts of Frankfurt.

Would you like to take that job?

And I said absolutely.

So packed up my life and Margaret and I moved to to Europe and I had to try and find my feet, you know, first job, first time using my university degree, first time out of home that first year.

It was one of the hardest things I've ever done.

Very homesick.

Learning German wasn't easy, but got my head around it and just shows what you could do if you really, really put your mind to it.

And I guess that was the making of me to a large degree.

Learning about data centres and connectivity and, and the company I work for was massively ahead of its time.

It was thinking about centralized compute and platforms, e-commerce platforms and they would deliver services to, to organizations and governments.

But then the.com bubble burst in the end of 2001 and suddenly I'm in a a team of 50 developers and we're just sitting around and everyone's just playing network computer games.

I was thinking this is not sustainable.

And I started to get really nervous because I didn't want to let anyone down and I didn't want to let my wife down.

And she relied on me to have an income and to be based in Europe, otherwise it would be unaffordable for her to race.

And so I did something silly.

I went and actually looked for another job because I wanted to have a green card so I could stay in Germany.

And I eventually found another company called Wolf Systems.

And we've done a bit of work with them when I worked at Integra and they're after some programmers and they worked in the banking space.

And so I went across and they gave me a job.

And that was on the Friday.

I signed the paperwork and left the company.

And then another defining moment, which is about doing your due diligence.

On the Monday morning at 8:00 AM, the HR people from Integra actually gave the 49 people that were remaining.

They offered them a year and a half salary to leave.

And I'd left on the Friday and that killed me because it was about €120,000.

That would have been amazing.

But I went across and started working as a programmer and the owner of the company was an amazing entrepreneur himself, Lutz, but he didn't speak much English and we had to work in written and spoken German.

And so the better my German got, the closer I got to to Lutz.

He loved sport, like love sport.

And so we really hit it off and we spent heaps of time together.

And then one day, fateful day, he said to me, Greg, you're really hopeless programmer and you're not really into it, are you?

And I said, no, I'm not actually.

I, you know, being a programmer is like a lifestyle.

And you know, I'm doing it from means to an end.

So I'm never going to be the best.

And he said, yeah, but you're really good with people and you speak English, so you should get into sales.

And I was like, sales, What's sales?

So it's easy.

You just, you know, you just ring people up.

And at that stage, their technology was used in most banks in in Germany, but not very much outside of Germany.

And he wanted to maintain some degree of growth.

And so he said, you know, just ring up America and and do business.

And I said OK.

And so then probably the next really difficult thing was for the next year, I went into work as everyone else was leaving at the end of the day.

I went into work and then all night I sat on the phone for 10 or 12 hours and I rang.

People in America across the various time ones had to get through all of the layers of resistance in organizations to find key decision makers and you had to influence them and, and whatnot.

And I was hopeless and I was nerve wracked and it was a terrible time.

However, eventually got better and better and better and by the end of it I almost felt like the Wolf of Wall Street.

I had so much pipeline and so much interest that I could spend one week of every month in the US for the next five years and that was unreal.

Never had so much fun.

I was travelling around the world and meeting amazing people in America and CEOs of banks, the chief information officers of banks, but also all of the technology companies that supported the banking industry.

And also the, the credit union industry, which is massive, in particular in the South of, of the US.

And spent lots of time in places like Alabama and Chicago and, and, and everyone loved me because Australia was the flavor of the month.

And they could Take Me Home for dinner and I'd have dinner with like the families of CEOs of banks and things.

And they'd just say, just talk, just talk.

We just want to listen.

And I just love the accent.

And I used to bang it on a little bit as well.

And, and the wise would be like, Oh my God, it's like having dinner with Greg Norman, you know, like it was just unreal.

And I became reasonably successful at integrating, you know, the Wolf system software into various credit union and retail banking applications in the US.

But, you know, all good things come to an end.

And after five years of spending one week in the US and playing golf and, you know, learning about wine and entertaining over dinner and various cultural differences, my wife had finished cycling in 2004 after just missing out on the Olympics.

But up until this point, I was still considered, you know, Margaret Hemsley's husband.

I didn't have a name.

And then we were contemplating moving back to Australia.

Guess for me this is where the merging of your story and what does become CDC, which of course originally was named Canberra Data Center, starts to emerge.

All the skills and insights from Europe made an opportunity and originally it comes in the form of a phone call from Ken Lowe, the then managing director of ASI Solutions and IT services business.

I've put my resume around to a few headhunters and then I get a phone call out of the blue one day and it's Ken Lark from ASI Solutions.

And Ken says like I've just been given your resume.

It says you want to move back to Australia.

Like, are you German?

Are you Australian?

Like what's the story?

And I gave him the background.

And at the time there was a big build up to the 2006 soccer World Cup in Germany.

And I had tickets to all the games because I went into a ballot and spent €2000 early.

And Ken and I were chatting and he's like, you know, it says you wouldn't mind working in Canberra.

Like no one wants to work in Canberra.

What do you want to work in Canberra for?

And I said, well, my wife's from Canberra, there's lots and lots of family and we want to be somewhere where there's family support.

Plus with cycling, I'd been going to Canberra for years and years and years and I love the place.

And he goes, well, I need a branch manager.

I've got 80 people down there.

We do a lot of work with government.

So I'd love to have you there, but you know, it's a big job and I'd like to meet you.

And I said, well, why don't you come over and come to one of the the football games, the soccer games.

And he said, no, I couldn't do that, couldn't do that.

And then about 48 hours before the quarterfinal with Italy in Kaiserslund, he rang me and said, look, are you fair income?

And I said, yeah, I'm not scamming you.

Like you said you wanted to meet and I've afforded you an opportunity.

So he said, I'm driving to the airport and I'm, I'm coming over.

And I said Beauty and so I picked him up and we drove out to Kaiser Satan Australia got, you know, robbed at the last minute by an Italian football falling over.

Who would have thunk it?

We went back and I dropped him back at Frankfurt and and he said to me, I'm actually here for a week, would you like to catch up and I'll meet your wife and, and all those things.

I said, Beauty, we we got to know each other and well, I really loved Ken and I still do to this day.

And, and he said, yeah, we'd love to have you and Margaret move to Canberra on the 3rd of October 2006 and lived with my, my parents in law.

My wife was, was pregnant with our first child and everything was, was going well.

Then this whole new world dealing with federal government never done it before in the banking world.

If you had a great idea and you could put a great proposal together and something that there was nothing else like it in the market, then you, you know, you could do business relatively easily.

And Ken's business had a great business, still does today, but there was lots of other organizations doing similar type of things.

And so the competition was fierce, margins were tight.

So it was, it was a tough gig.

But through that I just spent, you know, 8 to 10 hours every day meeting with people and talking to people.

And this reoccurring theme came up, which was we don't have any data centers.

We need data centers.

That's where the business opportunity is.

I would buy hardware from you, but I can't buy hardware because I don't have anywhere to put it and I have no power and cooling.

And then I got to know another gentleman, Peter Henson, who worked at the Department of Finance, and they were actually building a data center.

And every single day he was getting asked by all the other government agencies if you had capacity, we would rent space.

And so I said to Peter, well, how about we build a data center?

And then I got a few more people involved.

And the problem is you need money and you need land.

Ken and I, we did some land title searches and we realized we got to know who the owner was.

Contacted the owner directly told her my vision and she said, look, you know, seems like a better use of the property than just leasing it out at warehouse rates or, or selling it.

And so then obviously needed some money and Ken was excellent.

I, I again did the picture, said Ken.

Everywhere we go, everyone says they need a data centre.

There's no one competing against us because no one's building.

But we need to build a data center to be relevant and to be successful.

And I think we can be really successful.

And he said, how much money do you need?

And I gave him a very modest figure, which I should have put a ero on the end of it.

But he said I love a punt.

That was his due diligence.

Took him 20 seconds.

He said, I love a punt, Let's go.

And, and I always love Ken for that particular moment because what you got to consider at the exact same time in Canberra, it was a well known fact that data center capacity was needed.

And this is, you know, a sort of a tip for budding entrepreneurs out there.

A lot of people in Canberra had great ideas, but they're also getting paid 2 or 300 grand a year to be consultants or contractors.

So nobody wanted to risk their two or $300,000 a year to chase an idea.

And at the same time, there was probably 10, you know, really deep pocketed multinational companies that knew about the data center shortage and they're approaching and pitching to government.

But their message was you give me an anchor contract, Mr.

Government, and take away all my risk and I'll build you a data center.

Government says actually we don't buy vaporware.

If you build a data center and it's fit for purpose and passes all of our security certifications, etcetera, etcetera, and you win a pesky thing called a tender, then you can have government business.

And so in that vacuum, nobody was willing to risk it.

And so into that vacuum, Ken and I stepped and we started building the first data center in Hume and it was very modest.

You know, it was a six MW sort of shell with A1 MW first data hole.

And the moment that we turn soil and, and actually people could see generators turning up and, and other things, it was like game on.

And the business opportunity was the fact that all of the computing infrastructure that ran federal government kept the borders open, kept planes from running into each other.

That was all sitting in the basement of 60 year old government buildings.

And there was no purpose built data centers.

And so we took a risk, build it and they would come.

And before we'd even finished that first one MW had our first customers the first two years.

It took me about two years to sell the first one MW of capacity.

And we almost went bankrupt a few times.

And we needed shareholders to kick in.

We needed management not to get paid.

I had to look up the definition of trading insolvent a few times.

I almost died.

I went to hospital with a pulmonary embolism because I was working 20 hours a day and, and not being healthy.

And so it was really, really difficult.

But we slowly but surely got momentum and then the business went from, you know, strength to strength and we kept adding data centres and that growth has just continued to accelerate.

And now it's developed into, you know, $10 billion plus business and underpins much of the the economic well-being and and safety and security of of Australia.

That's one hell of a story, Greg, and I've actually never heard you tell it publicly and in full.

So I do feel very privileged to have heard it then and I'm sure our listeners will too.

It's a story, as I mentioned, of crafted skills, meeting an opportunity and the entrepreneurial spirit to really deliver on that, the pure resilience to push through those moments of friction that are also prevalent in the early stages of a new venture.

Can I get your reflections on my initial read?

And that is the skills you learnt in Germany were instrumental in selling the CDC proposition to government agencies who up until this point, many were just housing their data centres in their own basement.

I think one of the biggest problems people do is they have an idea and they have a, a framework or a construct that they work to.

And that was the same in the data center industry.

You know, data centres were designed in a certain way, they were sold in a certain way, electricity was procured in a certain way and, and, and all of those things.

And I just thought, well, how am I going to be relevant and differentiated so that I'm not going to be a commodity and how I'm going to be able to adapt to changing technology.

And there's, you know, lots of things in that space, but the real message was don't swim against the tide and, and design a business model and a contracting mechanism that is 80% fit for purpose.

Just spend all the time you can talking to customers.

As much as you can and then continuing to refine and adapt your data center design and the business model and all of the various levers at your disposal so that it's 100% exactly what the client wants and not 80%.

And then continue that process over and over again.

And I was very, very, you know, fortunate that in those early days it was just me.

You know, I did all the sales of, you know, I was the chief financial officer, everything until Lady Craig came on board and helped me manage the books and relationships and things, which was great.

But I was having every sales conversation.

Sales conversations is where you hear the objections and I would love to do this, but if only I could do this.

But and so it was just this constant, you know, market research and development.

And over the years now, I've done more than 6000 tours of the data center.

And you know, you're a famous sportsman and you've signed lots of autographs when you're doing a tour of the data center.

It might be your five thousandth tour of the data center, might be your thousandth autograph today.

But the child at the other end or the potential customer that I'm doing a tour for, it's their first data center tour.

It's their first autograph.

And in life, you only get one chance to make a good first impression.

And so I would always, regardless of how tired I was, exhausted I was.

You put on a good show on a tour and there'd always be about three or four different character types on those tours.

There'd be a hater who was nervous about their job.

There'd be someone that loved it, there'd be someone that was unsure, and then be the main person that would make the decision that was just an observer.

And you just got objection after objection after objection.

And that still happens to this day.

And we take all those objections and then we reverse engineer objection into a technical and contractible solution that ticks every single box and just irons out the objections.

And we did that over and over again, and we're still doing that today.

And that's LED CDC to have this incredible technological advantage that gives us so many more commercial levers to pull then if we created a vanilla product and then asked our clients to adapt their needs to our fundamental underpinning design and business methodology.

And that's been very rewarding.

And that's what we'll do forever is continue to follow our customers.

Yeah, I've heard you talk of great little tactics over the years that you've used, even hosting lunches.

And you felt like that was almost a a cheat code to the system because all the CIOs would get together and and talk to each other about what they wanted.

And you'd be sitting there listening and taking your notes.

And absolutely.

And, and actually this relationship runs deeply, not just from a sales point of view, but it plays a part of the technological advantage.

Yeah, having having an Advisory Board made-up of your customers was an early innovation for for CDC.

And in those days, all of the big tech companies used to try and divide and conquer government and keep them apart when every single government agency, they all have similar problems and similar challenges and every single one of them has tackled a different problem.

And it was an amazing opportunity to get all of the technology leaders together on a regular basis that were customers of mine and they learned a lot from one another.

And because I facilitated that, I learned a lot and that I just continued to apply, you know, nothing untoward.

Just apply the lessons learned from the conversations that I facilitated into a technical solution, a security solution, a sustainability solution, a financial solution that exceeded their expectations over and over again.

I also, you know, enjoy meeting people and I get a lot of energy out of people.

And so it was never a chore.

That's a nice point in time to get on to that competitive advantage that you talk to.

And often when people think of data centres, as you alluded to, they think of what is pretty much a commoditized business model.

In actual fact, that viewpoint allows you to do something different, and it did allow you to do something different.

If everybody thinks that they're dealing in a commoditized space, it gives you an opportunity to actually create a greater competitive advantage.

And in fact, the CDC model has become the industry standard.

That certainly wasn't the case back in 2007, 2008, but your modularized system has actually moved the entire industry.

Let's talk about why you win when it comes to technology and dealing with government.

The overarching feedback and being super naive, I'd never built a data center before, but I'd had lots to do with IT and IT infrastructure in the banking space and how resilient that was and how it had to be available 100% of the time and, and all of those things.

So I was hearing all the time all the problems people were having in data centers and every single data center, even the ones today, every single data center that's ever been built runs out of power before it runs out of space because Moore's Law of Compute.

And so compute shrinks and double S in capacity every 18 months.

This is Moore's law.

But these days when you put NVIDIA type chipsets, it's kind of Moore's law on steroids.

And then you get multiples of these chipsets and put it into an appliance and then create a subsystem of chipsets that all work together.

And it's kind of out of control in terms of the density of compute.

And so I was listening to this.

And then government agencies had always been inside their own facilities where they had complete control of their fire systems, their electrical, their cooling architecture, everything.

And so they were always nervous about sharing, but they didn't want to pay the cost of maintaining their systems internally or their facilities so that they're 100% available.

And I had a really simple premise that I would bring make the investment and bring the elements that give you 100% availability.

So the huge multiple power feeds, multiple generator farms having three or four sources of power.

And I would make that investment.

And then within the data center itself, we'd slice and dice that capacity into compartmentalized security, segregated sub systems that would then provide almost an infinite amount of flexibility and growth and adaptability, which could all be achieved without any disruption to any of the neighbors or any of the other agencies.

And when I talked in those terms, then suddenly it made a lot of sense for a lot of people because that wasn't the message they were hearing elsewhere.

It was how much per square meter.

And if you wanted more capacity, you had to get more square meters and there was floor loading constraints like all of these things.

And we're talking a long time ago, but all those things are still true to true today as they were then.

And our methodology was to build a box that even though it might be full and completely rented, the actual underlying baseline capacity would only be 4050% consumed.

Which then means over the next 20-30, forty, 50 years, clients on a client by client basis could actually adapt the amount of capacity they needed by consuming more of that big base load without any impact to their neighbors.

And the kicker was that you only had to pay for that capacity as you grew.

So pay as you grow as opposed to renting something for 20 years with a 20 year end state and then taking 20 years to grow into it.

And then knowing that it's never going to be fit for purpose anyway because that's not the way IT evolves.

That's more true today than ever.

And the AI infrastructure of today is completely different.

And one of the underpinnings there is the fact that data centers have always been allergic to reticulating liquid inside the data center, whereas the only way you can get true flexibility, fungibility and compartmentalization on a client by client, agency by agency basis is to have the flexibility that liquid in the data center provided for liquid cooling.

And because of that, we've become the home of research computing in Australia.

The biggest supercomputers in Australia live inside our production facilities are not purpose built.

They're just easily to to plug in, same as GPU clusters.

We've been doing GPU clusters for 15 years.

And so the whole world has now changed and shifted to our world that doesn't use any water in the primary cooling architecture, whereas all of our competitors are spewing millions of liters of clean drinking water into the air.

Combined with this fungibility and flexibility to do any measure of air cooling or liquid cooling in the data hole and any degree of density, low density to high density, suddenly this becomes very, very attractive because a data center migration moving in and moving out is incredibly expensive.

So if you only have to move in and never have to move out, the total cost of ownership looks pretty good, pretty quick.

And I'm happy to say we've had a a 0% churn rate in 17 years because our facilities continue to adapt to clients changing needs and they love it and I love delivering it because we take a much longer view.

We're not trying to build down to a price that's fit for purpose technically on day one.

We're building up to a standard which will future proof all of our clients, notwithstanding anything that happens in the technology space for the next 20 or 30 years.

And because we're taking a 20 or 30 year view on the asset, then suddenly we can do things commercially that are very, very attractive and really sets us apart not only in Australia, but also around the world.

And we have amazing strategic partnerships with with NVIDIA, for example, because we're the only data centres in Australia that are certified for their latest and greatest, most advanced chipsets today because we've been doing it for 17 years.

And strength breeds strength when it comes to CDC and you can certainly understand why governments love you because of these efficiencies.

And usually in government price goes the other way.

But in in fact, you've created cost efficiencies ensuring that their critical infrastructure is able to scale over long periods of time.

And it very much is a virtuous cycle, almost a scale economy shared model.

I do want to know, and I've never asked you this before, the tailwinds of initially the move to, to cloud computing.

And then as you talk about the the AI tailwinds, it's probably something that you could never have predicted.

We been to reverse my early comment, we started off as Canberra data centres, plural, because I was always optimistic.

I have more than one now 131314 building another seven and you know, we're we're well on our way to be having a GW of capacity.

When I started off with one MW like it's unreal.

And I, I would have been happy if we just were relatively successful in federal government.

And I never lost my house.

You know, that was, that was my driving kind of force for the first seven years.

I just didn't want to lose my house because all my assets were on the line, just like, you know, Ken's assets and, and a couple of the other founders as well.

So I felt great responsibility to ensure that the business survived and was successful.

But again, I just spoke to our customers all the time and at a certain point they said we need another data center.

We love what you do, but we can't have all of our eggs in one basket.

So then we went to another suburb in Fyshwick, which was far enough apart to provide them with the localized resilience that they were looking for.

And we developed the second site.

And then they said to me, Greg, we love what you do, but the future for us is going to be in cloud.

And so, Greg, we challenge you to go and get all of the major hyperscales to move into your data center.

And that's like 10 years ago.

And so before cloud was a thing, I was going to America and knocking on doors in America, which I'd done before.

And I was like, you know, Mr.

Hyperscaler of every flavour and every colour, we would love you to move in.

And for three years they all told me thanks for no thanks to smaller market.

We've got other priorities, you know, but eventually they realized that they'd have to to do it.

And then we started signing hyperscale capacity and they started deploying in a very modest and small way.

And then they were like, actually, this is pretty cool.

We normally telling data center operators how to do things, but we're actually learning from you guys and we're like a global company like this is a bit of a negative gold here.

And they can you do more for us?

Can you do more for us?

And at the same time, perversely, the more third party cloud optionality, many service providers that we had and also local Australian cloud providers that you had in your facility, the more attractive you were for government workloads.

And then the more government workloads you had, then the more attractive you were for all those third parties to come in to create this amazing ecosystem which was like a snowball that just got bigger and bigger and kept rolling and rolling.

And then all of these people that were loving our services in Canberra said you need to be for survivability, greater redundancy and resilience, geographic redundancy, you need to be in Sydney.

And so I went and I talked to lots and lots of researchers and they all told me I'd get eaten alive.

And I was mad.

You know, Canberra's a bit odd and a bit different, but Sydney's, you know, it's a mature market, there's big players, you know, you don't stand a snowflake's chance in hell of getting anything done in Sydney.

And I've always been one of those kids that if you tell me you can't do something, I just kind of get motivated and double down and won't sleep until I prove people wrong.

And so I did that, and we bought an amazing site at Eastern Creek, which was a modest data center on a huge block of land directly connected to the National Grid with all the fiber you needed to be successful.

And almost immediately we started winning bigger contracts from government and hyperscale.

And about $3 billion later, that's going to be a 300 MW data center site, which is completely contracted and absolutely firing.

And will say, and I would agree with them that moving to Sydney out of Canberra to give that greater diversity, but also to expose us to different commercial forces actually made us fitter and stronger, but also probably be in the hindsight, more important than the founding of the company in the 1st place.

The thing is government, enterprise and also cloud is all still growing and it's not going anywhere.

In fact, a lot of the critical industries are now being attracted into the ecosystem because they want to enjoy the same protections of government as national critical infrastructure organizations.

The, the, the high levels of security, resilience and you know, ownership structure and all of that stuff.

They want to enjoy all those things.

But AOI is another layer on top, which is just going to accelerate our growth further.

And again, the most important data sets in Australia live inside our facilities.

So that's quite a magnet for additional capacity.

Yeah, never in my wildest streams, wildest streams, Ed, did I think it would be what it is today.

And I honestly think, and I tell people this in America when I'm raising debt and I absolutely love it.

I said, look, I've been training for 17 years, nearly 18 now for this moment and I've haven't done 10,000 hours.

I've done like 50,000 hours and I'm ready to go.

This is my Super Bowl, this is my time and and we're on.

Electric, one little add in for ease.

One thing I picked up in my research is the importance of the proximity to power and people in connectivity when it comes to data centres.

And maybe just for the listeners, when you talk about this government feed, you're talking about the dark cabling, which is known as the icon feed that basically runs the critical infrastructure in Australia and all your data centers in Canberra connected to this.

I do want to move on to the corporate journey as well, which is so relevant to the CDC scaling journey.

So as it relates to the the corporate scaling journey, we're going to have to go back to what was it 2014?

You know, Commonwealth Bank and debt funded a lot of your business, but for the next dollar for them to fund, they needed more equity in the business.

And so you went looking for investors to to help support that growth and you ended up with a great investor in quadrant from that moment.

I'm keen to hear your lessons over selecting investors.

What you learned from that experience.

Now you know your investor base is essentially has been handpicked and and and perfect for the the needs of your business, But maybe we can traverse the the corporate history.

From an IT perspective, I was technically, you know, very strong.

And again, we were successful because every other data center operator would build data centers from the ground up, whereas we built it from the IT down perspective, which was novel.

But I was lied on in the the corporate kind of structuring debt, equity, you know, all of these things like I had no idea about all of these different elements.

And I was lucky at the time because, you know, the Commonwealth Bank had been long time bankers of ASI Solutions and ASI solutions have been around forever.

And the Commonwealth Bank was excellent.

You know, they did things that, you know, almost venture capital, I reckon.

And and we, we had some unreal friends in there that looked after us.

And the bank used to always say to me, Greg, we love what you do.

We can see it happening.

We can see, you know, demands outstripping supply, But you've got to set yourself up for success.

Like, you know, we can't do anything with fresh air and excitement.

You know, you've got to have skin in the game, you know, certain, you know, ratios and metrics that you've got to abide by.

And I was like, Oh yeah, but I just need more money.

Like, look at the growth.

We got the contracts, you know, and they said doesn't work that way.

And it was early days too, because there's a framework, a template for a home loan, a business loan, a construction and development loan for a block of flats or a warehouse.

But there wasn't a data center template.

So I was continually educating bankers and spending more time with bankers than I was with with customers.

And I was just getting so frustrated.

And then actually met your older brother, Ben.

And Ben was more on the business banking side of things.

And he was like, mate, we need to run a process here.

You need to bring some equity in.

And I was like, well, what does that mean?

And I said, am I going to lose control or am I going to lose, you know?

So he started all these things.

He was like, mate, it's better to own a little bit of something than a lot of nothing.

And you, you've got something special here.

And you don't want to flatline, you know, because of a lack of financial resources, because that's normally the problem is.

There's financial resources, but there's no business.

You've got the business, but you know, you need to work on the financial resources.

So he said, we're going to introduce you to all these different types of capital.

We're going to introduce you to family offices, we're going to introduce you to private equity and we're going to introduce you to big super.

So we, we went and met big super and spent lots of time with lots of people and they just looked at me like I was an idiot.

And I'm saying this is infrastructure.

And they're like, no infrastructure is an airport runway.

It's not a building with power.

That sounds very risky to us.

Plus we don't do 30 to 40% compound annual growth returns.

We don't do that.

We want something that is 7 or 8% and that's in our sweet spot.

I said, all right, OK, thank you.

So then met with with private equity and I was like, Oh my God, these people sound like Cowboys.

You know, all the connotations are gonna strip out costs and they're gonna package me up and I'm gonna get chopped up and sold.

And, you know, that made me concerned.

And family offices looked great, but then I was thinking about, well, if we go where I want to go, are these going to be big enough to continue to invest and Co invest and support us going forward?

And I don't want to go through this Hoo ha every 5 minutes because it's a massive distraction.

And I've spent six months not talking to customers, which was starting to hurt me.

So eventually we whittled it down to one private office, 1 private equity and, and also an investment manager representing big equity, but in a more flexible way.

And I love the quadrant guys immediately because they said this is the deal, this is the price, which wasn't the most expensive, but this is what we're going to do.

We're going to give you control and we're, we're going to work on alignment and we're going to go for gold and we're going to share the upside and we're going to share the downside equally.

And I was like, awesome.

And then the family office and the investment manager at the last minute, they were like, we're going to share in the upside, but we're going to protect their downside.

And I was like, well, we're either shareholders in this together because I'm killing myself.

And at that stage, I'd done seven years without a day off, without a holiday, seven days a week.

And so it just didn't feel right.

So I went with with Quadrant and the best decision I've ever made.

I got to know Chris and and Chris Hadley has forgotten more about business than most people will ever know.

And they really educated me and they're only there for 18 months, but before they came along, I had more than 150 individual financing arrangements for this generator, that chiller, you know, this pump.

And it was just a nightmare.

And they came in and immediately removed all those things.

They took over all the banking relationships and the financing conversation.

They put money into the business, which enabled me to hire really high quality staff, CFO, etcetera.

And then suddenly we're away.

And I then could focus 99% of my time on building the business and 1% of the time on stakeholder management because they were that good.

And the whole time I was talking to them and learning about business and learning about the best way to go about things because I was great at the data center business, but I didn't have the corporate wherewithal.

And one thing I've certainly learned is identify quickly what you're good at and what you're not good at and get people around you to help you with what you're not good at.

And through that experience, which was only 18 months, we went from being a enterprise value of $350 million to an enterprise value of $1.1 billion in 18 months.

And you know, interestingly, the under bidder over bidder that missed out Morrison's, they came in representing really, really serious shareholders and Quadrant did well 4 1/2 times their money or whatever the private equity measure is and they were very, very happy.

And that was only eight years ago.

And the new owners have done 10X their money.

Like it's amazing.

It is amazing.

The next owners have done very well, but more importantly they've probably been more fit for purpose for the expansion of the business.

So Infratel and the Future Fund and Commonwealth Super huge sums of money need to be used to to grow your business.

But you don't have to, as you say, keep coming back to the well.

These shareholders can support you now in perpetuity.

Correct.

And really happy with the performance and, and they're happy with the sector, the tailwinds and they also have, you know, one eye on, you know, nation building.

When you think about Infertil's assets around airports and grids in New Zealand and you think about the role of future fund and, and CSC and their relationship, it's the best ownership mix I could possibly have.

And believe it or not, it's actually really globally significant.

And what I mean by that is the deals now are so big and the capital required is so big that the biggest technology companies in the world are actually looking through the data center operator to see who the owners are and what's their time horizon, What's their ability to continue to fund the growth which our contracts will underpin and what's the risk of management flight or a sale because we've had a few sales after we've signed big contracts.

The new owners don't necessarily like the terms and conditions which the previous owners who have just sold have signed up to.

That dynamic actually gives people globally a lot of the confidence and when you say one of our major shareholders is the sovereign wealth fund of Australia, people listen.

Yeah, it doesn't matter what size or scale you are, the lesson of having long term supportive shareholders runs true.

And it's just, it's just alignment.

And you know, one of the magical things about alignment, it's not just shareholder alignment with the founder, it's also the management.

And if you look after the customers first, then you look after management second, the results will look after themselves and the shareholders will be happy.

And the best lesson I've learned from Quadrant is they came in and they said, Greg, you all like the key person here.

So what we're going to do, we like a bit of control.

So we're going to reduce the control of other shareholders, not that there was any issues, but we want control.

And then we are going to pay 100% for our shareholding, but we're only going to take 95%.

We're going to quarantine 5% for you to divvy out to key personnel across your business that are going to underpin the growth because we want alignment.

And that was the first time I'd heard of the word alignment.

And now I say alignment, you know, 20 times a day.

And that was the start of an incentive program that doesn't reward individual effort, but the collective outcome, which is exactly what is in the shareholders best interests.

And when the biggest customers in the world, government customers, enterprise customers, banks and the like learn that a significant number of employees percentage wise are actually shareholders in a business where you can't buy shares, they know that management's got skin in the game.

And that gives them actually a lot of confidence that, well, management's always going to work in the best long term interests of the customers and the shareholders.

So we couldn't be in a safer place.

Perfectly said.

The last thing I want to explore is around sustainability because there has been a lot of press and, and discussion around, you know, particularly power usage when it relates to to data centers.

I think that the stat that one data center consumes much energy as 80,000 households in a year.

But CDC has, you know, from its very beginning has a, a sustainability DNA.

And I'm keen to kind of unpack how you've thought about this as you've scaled to make sure that you're meeting your sustainability commitments.

It's a really good question and valid observation.

I started the business in 2007, so March 2007 or so is when I registered the company name.

And our first facility went live in April 2008 and was opened by Julia Gillard, then Deputy Prime Minister, and Kevin Rudd was the Prime Minister.

And Kevin Rudd won the 2007 election, which was right in the moment.

I was thinking about my business model on the greatest moral challenge of our time, which was climate change.

And there'd been a drought, hadn't rained forever.

And I just couldn't contemplate creating a data center that was consuming vast amounts of water.

So our design didn't have any water from day one.

And that's nearly 18 years ago.

And just recently I was in a data center meeting of the, the top 20 data center owners CE OS in the world.

And some of the biggest customers said, we will no longer contract with data centers that use water as their primary, in their primary cooling architecture.

And you can see the blood drain from the faces of everybody because everyone had been so reliant on cooling towers and, and whatnot.

So, so we've it's been, you're right in our DNA not to use water.

Then when it comes to energy, there is no doubt that there is an increase in the consumption of energy dedicated to data centers.

But keep in mind our business model was all about in the first instance removing all of this compute capacity from non purpose built server rooms in office buildings.

And all of the data that I could accumulate from our government agencies that moved into us said we were using six or seven times less power than their inefficient data centers they moved out of.

And people today say purpose built collocation data centers versus a disaggregated on premise type of footprints is A at least a 35% saving.

Well, our data was more like four or five 100% saving in electricity.

So bills and energy and all how that extrapolates.

And that was because we were incredibly energy efficient and the model of the modular rollout meant that you only paid for a energy overhead as you plugged in new capacity.

And whether the data center was one day old or 10 years old, the power and cooling infrastructure was really matched to the IT capacity at any given moment, so that our facilities always worked very energy efficiently.

So then you had to work on where does the energy come from?

And we're very, very lucky, like, very, very lucky.

Chief Minister Barr in the ICT is ahead of his time and in government with the support of the Greens in Canberra.

And we were the 7th or 8th city in the world to be 100% powered by renewable energy or net carbon 0 energy.

And that continues to this day.

So every electron that you plug in a piece of equipment in one of our Canberra facilities is using 100% green power automatically.

And I didn't have to think too hard about that.

It was just done for me by the ICT government.

And you know, thank you because that's really helped our business model in attracting capacity from out of town into Canberra, certainly just not federal government anymore.

But then we have put a lot of time F and energy and investment into Ppas and things like LGCS in order to offset our power requirements when the sun doesn't shine and the wind doesn't blow and those things.

And you know our portfolio today is more than 76% powered 100% of the time by renewable energy and the other periods of time we have mechanisms in place so that all of our energy is net carbon 0.

And that's the magic of data centers because we have such long term contracts.

You know my weighted average lease expire is 31.5 years today with options means that I have confidence to go into the market and actually underpin developments in renewable energy, help people think about hydro, geothermal, you know other more consistent base load type renewable energy sources that are out there.

Which is is amazing that we can actually have that impact and lock in pricing and what not for the long term for the benefit of our customers.

But in the process we're also contributing to the a positive energy transition, which not many industries can actually do that.

And the final element of the renewable story from a data center perspective, and this is I speak on behalf of all the data center operators, not just CDC, people underestimate the value of data centers to the electrical grid of Australia.

So the problem with power consumption is that any 24 hour cycle, it ebbs and flows.

There's high demand, peak demand, shoulder demand, low demand, nighttime, you know, all of these things.

And the electrical infrastructure of Australia, the grid has to bend and weave and duck and, you know, try and match this crazy demand all of the time.

Whereas data centers are a base load.

They're a constant load.

And the utility providers who we work incredibly closely with, you know, transcript and the like, they love data centers because data centers give you a very solid base load, consistent, predictable, which then actually takes variability out of the grid, which actually makes the grid more stable for everyone.

And then just as a byproduct of who we are and what we do, we have to be available 100% of the time.

You can't rely on the grid.

You know, you never know what's going to happen.

So to win contracts, we have to have secondary power sources that are localized.

So we have generation on site for all of the capacity, in most instances, not one, but two sets of generator farms that can support the entire load.

So even if we're down, there's two feeds to the site or the three feeds to the site for whatever reason are down, which is highly unlikely.

We've then got not one, but two sets of generators which can power the entire load of our facilities.

And what we've done increasingly in recent years is a EMO will come to us and say it's going to be 45 degrees, 40° next Thursday.

We calculate estimate there'll be 50 MW shortage in the NSW ACT grid.

You know, Greg, what can you do for us?

And I say we'll, we'll give you 50 megawatts and we curtail.

So we turn off the power to our data centers and actually run on generators.

And I ring up Mr.

Aemo and say, how did we go?

And they said, great, thank you so much.

It was only needed it for four hours, five hours, six hours.

But it's good, you know, the the hot afternoon air conditioners after work, all of that stuff.

And I said, what's the net impact?

And they go, well, probably 30-40 thousand houses didn't suffer a blackout.

And you go, oh, I feel pretty good about that.

And that's something that when you hear the doom and gloom of data centers, they're actually part of the solution, not part of the problem.

And we should embrace them as really, you know, the factories in the warehouses of the next generation that will underpin all of the the digital knowledge work that our economy should be based on as opposed to, you know, doom and gloom scenarios.

And so I think we have an amazing ESG sustainability story.

And that's not just CDC.

We only can operate whilst ever we have a social license to operate.

And the broader public needs to understand the importance of data centers and data centers today more than ever.

They're as equally as important as electricity, they're equally important as water, and they're more important than roads and bridges because during COVID we didn't need roads and bridges, but the data centers got a flogging.

So they're really important infrastructure.

We should embrace it and we should encourage and incentivise data centres because of not only the benefit they can make to the economy, but certainly with regards to clean energy transition, grid augmentation, Co investment, all of those things.

There's lots of advantages.

Fascinating.

I feel like I've just got an education in infrastructure in Australia, Greg and I loved it.

Incredible story, a story that's largely unknown and untold.

So to bring that to life as colourfully as you did, I'm eternally grateful.

So thanks Greg.

That was that was a wonderful hour.

Thank you, Ed, and yeah, pleasure being here as always.