Rackspace Adds Kevin Costello to Board of Directors

Rackspace (RAX) has added Kevin Costello, the former president of Ariba and a software-as-a-service (SaaS) veteran, to its board of directors.

Costello was Ariba’s president for six years, up to and after the acquisition of the company by SAP. But before that, he had an 18-year career at Andersen Business Consulting. While heading up Ariba, Costello was instrumental in the vendor’s shift towards cloud computing models. According to the Rackspace press release, Costello “provided strategic vision and operational guidance that helped transform the company into a leading global provider of cloud computing and commerce management solutions.”

Ariba was acquired by SAP in 2012, where he continued to serve as the president of Ariba and helped to drive Ariba’s spend management SaaS offerings through the SAP cloud organization.

“Kevin is a highly regarded and capable leader in the SaaS space who brings more than 25 years of consulting and advisory experience. He has helped numerous companies improve their competitive position through technology, strategy and services,” said Graham Weston, chairman of Rackspace, in a prepared statement. “Kevin will be a great addition to the board and a valuable member of the Rackspace team as we continue to gain momentum and grow in the managed cloud market segment.”

Just another board appointment, or is there something more to this?

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Rackspace has had a chaotic year, but one year that has proven fruitful for the company and its managed cloud services strategy. From investigating the potentials for being acquired to some doubting its infrastructure-as-a-service (IaaS) strategy, Rackspace has had quite the year. But in the end, its financials have been quite positive — even more so than was expected.

In an article on Zacks, Zacks Equity Research indicated the appointment of Costello as a big plus for Rackspace. The author wrote: “Costello brings to Rackspace extensive experience in consulting and advisory along with global business insight in both cloud computing and commerce management solutions. With his leadership traits, expertise and experience, he is expected to unlock further value. We believe that Costello’s sector know-how will prove beneficial for Rackspace.”