Robin Khuda on how he rebuilt from near bankruptcy to build data centre giant AirTrunk
Every morning, the man who built Australia’s most valuable network of data centres reminds himself of two key moments: when he was poor, and his company’s near-death.
Every morning, the man who built Australia’s most valuable network of data centres reminds himself of two key moments in his life: when he was poor, and his company’s near-death experience barely eight years ago.
Robin Khuda, the founder and chief executive of AirTrunk, likes to recall these memories just after he wakes up as reminders – to keep striving, practice gratitude, and take nothing for granted.
Khuda is now among Australia’s wealthy elite following the sale of AirTrunk to US private equity titan Blackstone last year in a blockbuster $24bn deal. He is staying on as CEO, maintains a small stake, and also reportedly received $500 million cash.
AirTrunk’s price tag was more than eight times the value of when the now former owner, Macquarie, bought into the business in 2020. Khuda is not done yet, vowing to hoist AirTrunk to become a $100bn colossus – a goal he believes is highly achievable.
He has dined with the Prime Minister and others in power, revealing a plan for Australia to diversify its economy away from mining and natural resources. Khuda thinks big.
While speaking with The List, he is warm, chatty and likes to laugh. The first thing Khuda does after greeting me – dressed in a T-shirt and jeans – at AirTrunk’s headquarters in North Sydney, is ask if I’d like a tour.
We meander through a sea of shared hot-desks as he explains that he also sits out in the open space alongside his colleagues. Climbing a stairwell, Khuda says he plans to lease more floors in the building because his company is expanding so much.
Finally, we reach the top floor. It has an expansive view of Sydney Harbour and there is a balcony and a bar stocked with Veuve Clicquot champagne.
Khuda gestures towards the other side of the harbour – where Salesforce’s offices tower over the Sydney Opera House – and says not only is the rent cheaper on AirTrunk’s side, the view is better, too. He throws a wide grin. This is a man who is clearly proud of what he’s built.
But the empire might just as easily have tumbled down like a house of cards before it even began. He later shares that just before Christmas in 2016, as most people were winding down for the holidays, he was seeking insolvency advice.
Khuda had founded AirTrunk about 12 months earlier, and data centres weren’t nearly as sexy as they are now, with fund managers struggling to define a category for them. Raising capital was difficult.
“I thought I was gone,” he says. “I was getting insolvency advice from a partner at [law firm] Norton Rose. I still remember the call.”
But the partner wasn’t planning to wind up the company, not without a fight.
“He said, ‘Look, you’re my second biggest creditor’. I said, ‘You’re screwed anyway’,” Khuda recalls. “And to give credit to them, they were very supportive of me.”
Six weeks later, Khuda had raised $400 million and was back in the game.
“It was very expensive. It wasn’t cheap. I raised a bunch of equity from Goldman Sachs and the TPG private equity guys, ING and Natixis bank, because none of the local banks … I still don’t think they understand data centre financing.”
But Khuda is used to taking on big bets. He moved to Australia from Bangladesh as a student in 1997 to study accounting at Sydney’s UTS.
An only child, his parents had staked everything they had on his future in Australia. “I was from a middle-class family. We didn’t have much money but they wanted me to have a better life,” Khuda says.
“Growing up in a third-world country, it’s very different. So they made a lot of sacrifices. I didn’t have any other siblings. I’m the only person they’ve had to worry about. They were basically putting a bet on one thing, and that one thing was me, which was very generous of them.
“You realise how much your parents love you. They’re giving up everything. I’m very grateful to them, without them, I wouldn’t be here.”
Accounting may have seemed a safe bet; but the allure of technology was difficult to resist and full of opportunity. Importantly, Khuda could envisage a career where he could enjoy himself.
After graduating from UTS, he got a job at Optus “back in the fun days”.
“They were the challenger brand and doing lots of exciting stuff,” he recalls. “Optus was investing billions of dollars of capital, building everything from satellite stations to transmission networks – all the infrastructure, which was quite exciting for me. Fascinating. How this infrastructure (was) powering the internet.
“That’s when I had an appreciation for working in technology. It is such a dynamic, fast-moving sector – more my type than doing the audit report and all the time sheet stuff.”
Khuda then moved to Brisbane to become chief financial officer at Pipe Networks, a start-up helmed by Bevan Slattery who later founded ASX-listed data centre operator NextDC.
It was an experience Khuda describes as a “turning point” in his career, and where he learned how to start a business, scale up, and – most crucially – what not to do. “You know, good and bad,” he explains.
After Slattery sold Pipe Networks to TPG Telecom for $373m in 2010, Khuda became “employee No. 1” at NextDC where the duo began to build a data centre empire in days when data centres were unknown as an investment category.
“No-one understood what a data centre was. The cloud, AWS (Amazon Web Services) started in 2006 – which was tiny. Microsoft Azure started in 2010. Google Cloud started in 2010,” Khuda says.
“It was early days and when you’re in front of fund managers and saying, ‘Hey, we’re going to build a data centre’, no-one understood – are you a power company, a property company, etc.
“So the only way to raise money was doing an equity raising. Because Pipe (Networks) was successful, a lot of small cap funds made a lot of money – and they basically backed us.”
As well as being CFO at NextDC, Khuda became an executive director, while also running the sales team. “In a small business, you get to do everything, including making tea and coffee as well,” he says.
It didn’t take Khuda long to recognise that data centres were going to become big business. AWS, Microsoft and Google began growing quickly in the early 2010s, but the biggest data centres at the time were about 15-20 megawatts. AirTrunk now offers more than 755 megawatts of capacity across its campuses in Sydney and Melbourne.
“I saw the opportunity that enterprises will move into a more centralised environment,” he says. “That’s what the cloud is. Amazon, Microsoft, Google – they’re aggregating demand from tens of thousands of user enterprises. That way, they get scale, they get cost efficiency and they offer them better security. I strongly believe in that.”
But even as late as 2013, Khuda says there was no data centre provider that could provide hyperscalers with the capacity they needed to achieve their ambitions for cloud computing.
“Unfortunately, there wasn’t anybody there. So after I left NextDC, I hired a bunch of engineers with the view of ‘I want to build something scalable’,” he says.
“Data centres are very capex (capital expenditure) intensive. They’re not modular. You have to do an upfront investment, and it’s not until the facilities are fully utilised – you have to wait that long to get the full initial return.
“So I started with a clean sheet of paper and said, ‘OK, I want to build cheaper than anyone else, I want to build faster than anyone else, I want to build scalable, and very energy-efficient as well,’ – because data centres consume a lot of energy, and there is a big energy cost.
“And in early 2015, I sort of officially started AirTrunk.”
But while Khuda could see how vital data centres would become to powering businesses and later the artificial intelligence boom, the key to success lay in the execution.
After AirTrunk’s near-death experience in seeking insolvency advice, he had to show he could not only deliver a project, but also deliver on budget. Do that, and you create a snowball effect.
“I’ll take any money to do it and fast-track it. I ended up delivering (data centre) capabilities to our customers in Sydney and Melbourne,” Khuda says. “That customer was super happy and backed me in Singapore. So we went to build a data centre in Singapore, then in Hong Kong.
“Based on that, we built a track record. Everyone said, ‘Look, there is a lot of demand, etc’. But the key to success is executing, because these customers, they’re the most demanding customers you can think of.”
Of course, Khuda is talking about the likes of Apple, Amazon, Google and Microsoft. “When you look at their [size], I was like at the other part of the spectrum. They build, operate more data centres than anyone else in the world. You need to be better than them. It’s basically selling ice to an Eskimo. You need to do a better job than them.
“One of the great things about AirTrunk is that we have now delivered several billion dollars of projects. And every time, we deliver ahead of budget, under budget. It’s that repeatability. We’re like a machine – a well-run machine.”
So what does Khuda do for fun, when he’s not overseeing such a slick performance?
His answer invokes another tech pioneer – Nvidia founder Jensen Huang, who makes the powerful chips that go in the servers of those data centres to fuel the AI boom. The 61-year-old reportedly doesn’t remember movies because he’s thinking about Nvidia the whole time, and rarely takes vacations.
Khuda does have a penchant for real estate, though, and has purchased several mansions and beachside houses in recent years along with dabbling in high-end residential development projects in Sydney suburbs including Palm Beach and Manly.
“Every year I promise myself I’ll have a quiet year next year … but that’s really the excitement. Firstly, I love what I’m doing. It’s not just coming to work for the sake of it,” Khuda says.
“And there are a lot of opportunities. We’re sort of in the early days [of] how a data centre can play a bigger impact on local communities, the energy transition … we see huge opportunities.”
Australia can take a front-row seat with the growth of data centres as demand for AI booms, Khuda believes.
“I have mentioned to Albo (Prime Minister Anthony Albanese) and some of the government people as well, that we are a country so focused on mining and natural resources. If you look at the top 10 companies by market [capitalisation] in Australia, only two companies were founded in the last 50 years: Atlassian (which is listed on the Nasdaq in the US) and Goodman Group.
“But you look at the US, seven of the top 10 companies were created in the last 50 years, and six of them are tech companies.
“We should capitalise on this investment in data centres and AI. We should make it easy for some of the investment, the planning processes. This is the one way I think Australia can diversify its economy for the long term. Because if we don’t make this decision now, we’re going to miss out on those opportunities.
“Our customers invest in billions of dollars, and they don’t need to invest in Australia. They want to invest somewhere where the government will support them, and make it easy for them.”
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