Founder Profile: Marc Gonzalez of Site2

Scranton’s Site2 uses cloud technology to allow small to mid-sized businesses to have the latest high-tech IT solutions without having to experience “refresh pain” from constantly evolving technology.

Site2 started out as a business continuity and backup service, but co-founders Marc Gonzalez and Mark Magdon quickly realized there was a hole in the market: Many companies are too small to have their own IT departments. They became a comprehensive IT service company.

Since that shift, the company has grown from a two-person operation in the Carbondale Technology Transfer Center (a business incubator) to a thriving enterprise with customers in 27 states, and data centers in four locations.

Gonzalez, a native of New York City whose French mother and Colombian father worked for the United Nations, chose Northeastern Pennsylvania the place he wanted to go to college (University of Scranton), raise his family and grow his business.

“My family and I always vacationed here,” he says. “It was a nearby paradise for New Yorkers to come to the Poconos.”

What inspired you to start Site2?

Personally, I always had a bit of the entrepreneurial spirit within me. I worked for about 16 years in corporate America, for large corporations with tremendous resources, including Prudential, MetLife and IBM.

In about 2003, I was speaking with a friend about taking what I had learned in corporate America and bringing it into small to mid-sized businesses that were underserved in the IT area.

He said, ‘You sound exactly like my neighbor.’ His neighbor was Mark Magdon, who worked as an IT director for AOL Time Warner and other corporations. He had run data centers all over the country, and he was also looking to apply what he learned in a new business. We met in 2004, and we shared the same passion and interests. We put together a business plan and incorporated on January 1, 2005.

The original mission was to manage IT services for businesses, but we focused initially on business continuity, getting small to midsized businesses to care about the intellectual property they were storing on their computers, whether it was the secret recipe for a new product or something often overlooked, like payroll, human resources, financial records. (This was before the well-publicized data breaches we have today.)

We started at the early stages of the cloud revolution, when laws were being enacted to protect records and people were looking for innovative ways of getting their technology.

We started with backup and evolved over the years to offer more services that our customers were demanding. Now we offer services in a hosted manner. We have the data, the equipment and the software in our data centers, and we make them available through an Internet connection, saving the customer the expense of building their own environment.

If they’re within an hour’s radius of us, we can provide people to go to their office and provide in-person troubleshooting. For customers in other states, we have personnel through partners.

IT is becoming more of a service, like electricity or water, managed at a central location by someone you rarely see. It’s like e-mail — a perfect example of cloud computing.

How has your company grown?

In 2005, it was just the two of us, and then we hired one employee. We had a small computer room in the incubator where we housed our technology.

At the time, businesses in New York City (after 9/11) were looking to back up their data offsite and out of the “blast zone.” “Wall Street West” was being promoted in Northeastern Pennsylvania. We had some success with that and, in August 2006, we agreed to be acquired by Diversified Information Technologies Inc., a national records management and document imaging company with headquarters in Scranton.

As a distinct division under the name Diversified Availability Solutions, we grew the business, adding an additional data center in Binghamton, N.Y. We enjoyed our time with DIT for a little over two years. In December 2008, when DIT decided to go back to focusing on scanning paper records, we left and established Site2 as a stand-alone business owned and managed by Mark, myself and two other business partners who have since left.

Now we have four data centers, in Scranton; Silver Spring, Md.; Rochester, N.Y.; and Phoenix, Ariz. We have seven employees in Scranton and 12 in Maryland. We just have equipment in Rochester and Phoenix, with contracts with the facilities there to have their employees service our equipment when needed.

In Scranton, we are in the Cait Center, a multi-tenant facility we moved into after leaving DIT. We were fortunate that we could find a space that had a data center built by an energy company that sold the building to its current owners. It already had a backup diesel generator for an uninterruptible power supply, and four different communications suppliers to the building. If we hadn’t found it, we might have had to leave Pennsylvania.

What resources did you take advantage of to grow the business?

When we were looking to create software that would be used for businesses to help them recover their systems in the event of a disaster, Ben Franklin Technology Partners of Northeastern Pennsylvania helped us to develop that business plan. They gave us funding and put us in contact with some excellent business writers and planners.

We learned that our idea was not unique, so we didn’t pursue it. We probably wouldn’t have learned that as quickly without their help.

Our current facility in Scranton is in a Keystone Innovation Zone. We have benefited greatly from the KIZ and also the Keystone Opportunity Zone. Without those two things, we might not have been able to succeed as quickly.

What was the biggest challenge in getting Site2 off the ground?

The biggest thing when you’re building a service organization like ours is that you have to build it and hope that they will come. We needed to have everything in place before bringing customer number one on board. IT is a very costly endeavor. There was a lot of luck along the way.

What’s the big differentiator for your company?

Service. It’s the small-business experience for other businesses. They can count on being able to speak with someone, as opposed to an automated attendant or someone from across the globe. We keep all the data in the United States. We are constantly conscious of security rules and regulations.

What’s next for Site2?

Our goal is to keep growing the company by adding partners in all 50 states. Backup and business continuity will become an inherent feature of the services that we offer. It’s the insurance policy of the 21st century.

Writer: Susan L. Pena