10 Questions with Sean Murphy of Canvas Systems

I asked Sean Murphy, co-founder of Canvas Systems, to answer a few questions related to entrepreneurship, his business experience, and the pre-owned IT equipment industry.   I met Sean a few years ago during our involvement with local youth athletics.   Sean is a great family man, a successful entrepreneur, and very active in our local community. I hope you find value in this quick interview and can use it to gain insights and ideas for your own career and business.

1. When did you first know you wanted to start your own business? Was there a defining moment or experience?

I had two sets of these moments, so I will discuss both briefly.  After my senior year of high school, I worked for a commercial landscaping company.  I used to do all the landscaping maintenance for banks, restaurants and other businesses.  After doing the work, I would take a document inside to get the manager to sign off on the work.  At some point I became aware of what the customers were paying for my work, and then quickly did the math on what I was getting paid to do it.   I instantly wanted to own my own business.  Fast forward to my early 30s; I had worked for a computer company for 10 years, was promoted to VP at 28 and I thought the company loved me.  Then one day the owner came in and offered me my boss’s job (while my boss was on vacation).  He offered to double my six figure pay to betray my boss (who was also a good friend.)

At this moment, while the money was tempting, I knew that my employer did not love me and, furthermore, someday I would be on vacation and it would be me.  I had always loved the thought of independence and doing what I wanted to do, and having lost my trust in working for someone else, I left and started my own business.

2. What was the toughest lesson you learned while starting a company?

I learned that cash flow is king, so if and when you will get paid by customers is more important than how much profit you have in a particular transaction.  I skipped taking pay for many months, and greeted the Postal carrier at the door looking for client payment checks ‘til I realized how important cash flow is.

3. What is the most surprising thing you learned while starting a company?

I learned from my former job how companies should not treat their employees; so the most surprising thing I learned from starting my company is that if you treat your employees like gold, they will work harder to keep your company alive than you would ever believe.  Our employees spend as much time on the job as they do at their house, or with family, so we have to be worthy of all these people spending their lives working for us.  We work hard to be a great place to spend your life.

4. How has the economy downturn of 2008 and 2009 affected the way businesses purchase and maintain IT equipment?

My business, Canvas Systems, is the world leader in selling and maintaining refurbished IT equipment for corporations.   We focus on data center equipment, not desktop and laptops. So our value proposition is focused around saving companies time and a whole lot of money.  Prior to the economic slowdown, corporate IT purchasers were not very concerned with saving $$$$.  But now, Canvas’ business is growing as companies look to acquire systems from Canvas that come from bankruptcies like Lehman Brothers, and others. Our maintenance business of doing routine service is our fastest growing business.  We offer better service than the giant manufacturers, at around 50% lower cost.  We had many Fortune 500 companies as maintenance clients in 2009.

5. How is cloud computing affecting business at Canvas Systems?

Cloud computing is one of the most popular discussions our clients are having, but so far, not much serious action has been taken. Our firm is at risk of losing business if clients no longer purchase their own infrastructure, but for now it seems a ways off.  In 2009, we obtained a major investment from Platinum Equity, one of the largest private equity firms in the world, to give us a war chest to build our business to withstand and prosper in the cloud computing era.

6. Canvas Systems is using a company blog and video as a customer outreach.  How have these social media tools been successful in connecting you more with clients and prospects ?

Yes we do use blogging and video; one really exciting video project we did was this past holiday season. Instead of having a large company Christmas party and sending corporate gifts, we used the money to give 700 bicycles to Toys for Tots.  We had a company function to celebrate and assemble the bikes.   We videoed the entire process and sent the video to our customers and prospects instead of paperweights or gift baskets.  The response has been amazing.

7. Do you plan to expand your use of social media in 2010?

Like all companies, we are trying to focus our marketing dollars on areas where we get a measurable ROI. I think we will expand social media use in 2010, because we think it can be more targeted to our prospects.  It is also more dynamic, so in a fast paced business, we can change our message to adapt to the marketplace hourly and daily – and not monthly or quarterly as in the past.

8. What are the next big trends you are following that could impact your industry?

Virtualization, Cloud computing and Software/Hardware –as –a –Service are three trends I have my eyes on. Over the past 20 years IT budgets have grown even though we have heard of cost savings breakthroughs. Canvas Systems has been successful by trying to be the best in the world at providing pre-owned infrastructure.  So we need to try and stay ahead of any ways these three trends could affect top line revenue and margins.  One trend that continues to help us is Globalization.  We sell to clients in 77 countries today; hopefully it will be 200 in the future.

9. What book is on your night stand now?

I confess I have about 20 books on my nightstand, but one new one is “Freakanomics”.

10. What’s next for Sean Murphy?

I plan to keep helping to steer Canvas Systems into the future. I also am invested in a disaster recovery company called Corus360; check it out at Corus360.com!

While I have discussed a lot of my business life, my next thing is the same thing that I have really been focused on for years, and that is my family.  I have four children and a beautiful wife.  I am spending as much time with them as possible.  You can always make money, but you can’t go back and see missed school plays or games, or dinners at home.

One final comment:  Gwinnett County has been a great place to live and start a business, so I also plan to give back to the community.  I currently serve on boards for the Chamber of Commerce, Gwinnett Clean and Beautiful, Gwinnett Technical College, and Gwinnett Public Schools, so I challenge all busy people to find time to give back locally!