Amazon Web Services has led to an entire booming industry of tech companies that help keep cloud costs under control. Here are 10 players in the space.
- Amazon Web Services provides enterprises and small businesses alike the ability to back up data and create software as a service (SaaS) applications on the cloud.
- But many businesses can easily find themselves running up bills or creating cloud sprawl.
- These 10 tech companies and consultancies help minimize scope creep, improve performance, and plug security holes on AWS.
- Visit Business Insider's homepage for more stories.
For most businesses, scalability is among the top attractions of Amazon Web Services (AWS), Amazon's behemoth cloud computing service. AWS offers computing power and storage across the globe, providing resources that can be purchased in custom-sized, reasonably-priced increments on an on-demand basis. Data backup, hosting, and creating software as a service (SaaS) applications on the cloud are some of the most common ways that companies use AWS.
However, without centralized management, businesses can quickly find themselves running up big bills or creating "cloud sprawl." The pandemic, with companies relying on remote operations served up by the cloud, has exacerbated these issues.
NASA, for example, got a nasty surprise last spring when it discovered unaccounted-for download fees associated with its scientists accessing the massive amount of data it stored on the Amazon cloud. When the agency did the math, it needed an additional $30 million per year as a result of its oversight.
"The capacity a company purchases with a cloud provider is only the beginning of the total public cloud fees they'll typically see; other costs include various support costs, minimum instance sizes, performance costs, and transaction costs," said Jeremy Fitzpatrick, VP of sales and marketing at cloud solutions provider NFINIT. "Of all the extra charges, the most common that can be damaging to a budget can be the transaction costs, especially moving data in and out — known as ingress and egress. These seemingly small moves can add up, sometimes doubling the total price a company is expecting."
A host of companies exist to help businesses avoid such pitfalls: Cloud consultancies specialize in helping businesses minimize scope creep in their deployments and right-sizing their cloud usage while also plugging security holes and improving performance. Companies come out on the other side having saved as much as 30% up to even 60% on their AWS instances, these companies reported.
While many are venture-backed, this also remains a corner of the tech industry where companies can grow for decades as fully private companies without any VC cash.
Here's a look at 10 cloud companies designed to keep AWS costs under control, and, for the venture-backed companies, we've named the VCs that funded them.
The companies are listed in no particular order.
Total funding: No venture funding reported, according to PitchBook
Chicago-based SCTG has been around since 2000, when it grew its footprint in internet services up from domain-name sales to its current portfolio of managed data-center services, managed public and private cloud services, cloud-native software development, and business continuity solutions, as well as cloud consulting.
Founded by CEO Jordan Lowe and COO Daniel Brosk, SCTG is an AWS Advanced Consulting Partner and specializes in companies "new to the AWS Cloud," or those looking to "optimize their investment and realize the full potential of the platform," Lowe said.
The cornerstone of SCTG's AWS business lies within its 2018 acquisition of Turing Group, an early company in the field. Turing launched in 2013 and never disclosed any funding rounds from classic Silicon Valley VCs. SCTG had made a strategic investment in Turing in 2017 before buying it outright the next year.
Thanks to 2020's rush to the cloud, the company is trending approximately 10% over its original projections for 2020, according to Lowe.
Total funding: $23 million, according to Crunchbase
Investors: Great Hill Partners
Three heads are better than one in the case of Mission, a Los Angeles-based company that's a blend of one Boston-based firm and two from Southern California. While each of the three original companies overlapped in AWS expertise around performance and cost best practices, in its composite form Mission offers its customers a nationwide presence and experience in a broad set of customer verticals including ecommerce, media and entertainment, healthcare, life sciences, education, and SaaS, among others.
Founded in 2018, Mission's customer base focuses on US-headquartered SMBs, startups, and mid-market enterprises, with CEO Simon Anderson noting the company has recently expanded to companies doing upwards of $1 billion in revenue.
He said the company's strategy is based on continual optimization, being able to do the work sight unseen to the customer's end users, and making the whirlwind of reporting data that's available on the AWS Cloud easy to digest.
"We also provide tools that enable further cost reductions by offering clear AWS cost transparency and granular insights into where cloud budget is going," Anderson said. "For example, we use CloudHealth, which provides particularly detailed visibility into an SMB's AWS usage and costs."
Anderson reports that Mission is on track to close 2020 with revenues up 82% year over year.
Total funding: $239.5 million, according to Crunchbase
Investors: Sequoia Capital, S Capital VC, Pitango Venture Capital, Globespan Capital Partners, Vintage Investment Partners, Ibex Investors, Tenaya Capital, and Scale Up
With a focus on hybrid cloud solutions — which blends on-premises data centers with cloud computing — Silk has been guiding its users to cost savings on the cloud for more than 10 years.
According to founder and CEO Dani Golan, who was an Israeli fighter pilot before getting into the tech industry, the hybrid approach and Silk's cloud-agnostic foundation, offering services from Amazon as well as from Microsoft Azure and Google Cloud Platform, enables its customers to draw 10 times the performance out of their existing cloud data while spending as much as 30% less.
Founded under the name Kaminario — it emerged from a rebrand with the new moniker this past June — the company got its start selling flash storage and evolved from other forms of hardware storage onto the cloud.
It's services help companies easily "move Tier 1 mission-critical applications and databases from one cloud to another or from on-prem to the cloud and back again," Golan said.
Silk has attracted businesses across the revenue spectrum, Golan said, serving verticals including SaaS technology, healthcare, financial, and retail. Golan reports 250% growth year on year in the number of cloud deployments, and attributes the company's brisk pace in 2020 to the effects of COVID-19.
Silk has offices across North America as well as in the United Kingdom, Europe, the Middle East, and Africa. The company runs its research and development operations out of Israel.
Total funding: No venture funding reported, according to Crunchbase
Founded in 1989 as American Internet Services, four acquisitions and a merger later NFINIT emerged in February 2020. NFINIT specializes in providing cloud services to "high compliance" industries like healthcare and finance.
"In 2018, about 4% of our total revenue came from cloud and managed services, and today, that number is 41%," said the company's VP of sales and marketing Jeremy Fitzpatrick. "Many of our customers who make up that 41% are adhering to a hybrid or multicloud model — they often have data stored across various clouds, both public and private, and in NFINIT's colocation facilities, our data centers."
Fitzgerald said the company will be "doubling down" on its managed services approach and releasing new data management products in 2021.
Total funding: No venture funding reported, according to Crunchbase
The engineers behind Cloudtamer worked closely with AWS in 2016 on a successful proof-of-concept for a federal government customer. During the project, the group experienced the three core challenges of managing cloud environments as enterprise usage scales: controlling costs, ensuring security, and automating provisioning, said CEO and cofounder Brian Price.
"We saw an opportunity in the market," Price said. "There was — and still is — a lot of complexity configuring cloud provider's native tool sets, and there are key gaps in the cloud platforms themselves, like billing frequency and service limits, that customers struggle with. We publicly launched in 2018 after supporting several early customers like NASA that were finding success with our new automated approach to cloud management."
That automated approach provides Cloudtamer's customers with proactive tools that monitor by estimating spending that's occurred since the last time cloud billing reports were refreshed. It also takes automated steps to not only alert but remove accesses or stop resources in cloud accounts that exceed budget thresholds. Cloudtamer offers similar tools in the area of security to assist in visualizing how an organization is functioning in that respect.
Price reported Cloudtamer has gained in excess of $10 million in revenue in its first three years in business from more than 30 public sector customers, including the DHS and the CDC as well as private-sector companies like Verizon and Indeed.
Total funding: $52.6 million (before acquisition), according to Crunchbase
Investors: Intel Capital, Vertex Ventures Israel, Pico Partners, and Springtide Ventures
Founded in 2015, Spot (formerly Spotinst) was acquired by NetApp in March 2020 for a reported $450 million.
Spot offers machine-learning software that auto-scales and provisions the cloud, enabling customers to save what cofounder, VP, and GM Amiram Shachar reported is as much as 90% on their compute costs while simplifying and automating cloud infrastructure.
Shachar, who worked in the Israeli Defense Forces (IDF) cloud infrastructure unit with Cofounder and Chief Architect Liron Polak, said the company's solutions were born from personal experience.
In the IDF, he said, "as our use of cloud resources grew, it became harder and harder to use those resources effectively, and as a result our cloud infrastructure bill grew exponentially quarter after quarter, and since we were a small team of DevOps engineers, we had to come up with a creative and automated approach. We did that by inventing technology that would continuously optimize our cloud infrastructure via an economical combination of compute purchasing across spot and reserved instances. That allowed us to save up to 80% on our cloud compute costs."
Spot grew into handling more features, allowing users to focus on using their applications without worrying about cloud sprawl. With a research and development operation based in Tel Aviv, Israel, it established offices in New York and San Francisco as well as London.
NetApp reported public cloud services annualized recurring revenue of $178 million, an increase of 192% year over year, and Shachar said Spot has seen the same kind of strong, continued revenue growth even throughout the pandemic.
Total funding: No venture funding reported, according to Crunchbase
nClouds CEO and cofounder JT Giri has direct, hands-on experience with the AWS cloud since nearly its very beginning with the AWS EC2's beta version in 2006. Giri continues to go all-in serving the company's clients solely on this platform with both his more traditional cloud consultancy and nOps, a company spun out of nClouds specializing in the management of complex environments and servicing sophisticated in-house DevOps.
"We remain deeply invested in AWS for many reasons — the key ones are breadth and maturity of services, market momentum, and their commitment to success for customers and partners," Giri said.
nOps, a machine-learning platform that nClouds developed and then spun off into a separate company, cuts down on expenditures by automatically performing tasks like uncovering underutilized resources, including over specified capacity and "zombie instances" — cloud instances that were launched and are no longer being used, but are active and generating costs just the same.
"Our superpower is working with startups, SMBs, and growth-stage companies who need these resources and flexibility," Giri said. "They move fast, and their core needs typically revolve around how to deliver innovation faster, smarter, more efficiently."
The company's prowess has also attracted enterprise-sized companies like Avaya, E. & J. Gallo Winery, and Shell to the table, on the back of which it said it experienced an 85% gain in revenue numbers in 2020.
"We grew rapidly during the pandemic, fueled largely by customers' need for cost takeout," Giri said. "This drove new customers, expansion within existing customers, and new partner relationships." Giri said nOps was on track to end 2020 with annual recurring revenue growth of more than 2,038%, and projected 892% growth in 2021.
Total funding: $85 million, according to PitchBook
Investors: HighBar Partners, Azure Capital Partners, Benhamou Global Ventures, Kinetic Ventures, and TriplePoint Venture Growth
How to accurately estimate cloud costs before you actually migrate to the cloud: This has long been one of cloud computing's holy grails.
Virtana, with their "Know Before You Go" promise, claims to have cracked the code on this goal with their recently-delivered unified platform for migrating, optimizing, and managing application workloads across public, private, hybrid, and multicloud environments. In a study released prior to its public debut, Forrester Consulting said the Virtana platform could deliver as much as 145% ROI over a three-year period.
"Our platform provides customers with full transparency across the application topology and mission-critical workloads so customers know what to move and when," said Virtana CEO and President Kash Shaikh. "Contrast this with other solutions that are focused on optimizing the cloud once you have moved your workloads — this is like moving your furniture to a new home and just hoping it fits."
Virtana has more than 15 years of history managing both public and private cloud infrastructure and optimizing application-centric workloads and performance in the data center. The company counts more than 250 of the Global 2000 among its roster, enterprises including AstraZeneca, PayPal, Dell, Lloyds, Nasdaq, and Boeing. Having helped companies like these manage their workloads across time, Virtana said its engineers observed repeated attempts to reduce costs by arranging for long-term contracts, which in turn resulted in waste due to failure to account for workload, application requirements, and the technical capabilities of the customer.
"The net effect is that budgets are negatively impacted and they are forced into two camps: One, they have too much cloud and they try to sell it at a loss, then they get big surprises of poor performance, or two, they end up lacking availability and having to make a huge unplanned spend," Shaikh said.
Shaikh said the company's healthcare vertical initially declined as a result of the pandemic, but that Virtana experienced growth in all sectors as 2020 closed out.
"Even healthcare is coming back strong and will likely be significantly larger in 2021 than 2019 — in part because the healthcare sector is now scrambling to figure out how to address the unprecedented scale of IT needed for the care and distribution of the COVID-19 vaccine," he said.
Total funding: $261 million, according to Crunchbase (before IPO). Apptio has since gone private, financed by Vista Equity Partners.
Investors: Greylock, Andreessen Horowitz,, Madrona Venture Group, Shasta Ventures, T. Rowe Price, Janus Capital Group, and The Hillman Group
Balance — that's the thing that Apptio Chief Product and Technology Officer Scott Chancellor said is the biggest challenge for most organizations working in the cloud, and the thing that Apptio aimed for with the Cloudability platform it acquired in May 2019.
Chancellor, the former AWS general manager, said that Cloudability can reduce costs as much as 30% by cutting down on cloud sprawl and the corresponding amount of time that cloud management tends to suck up along the way. This right-sizing has attracted more than 60% of the Fortune 100 to the company's services, according to Apptio, including Unilever and Red Hat.
The pandemic caused Chancellor to reflect back to the company's roots in 2008, just a year after CEO Sunny Gupta and CFO Kurt Shintaffer founded Apptio in 2007.
"We found that our customers needed to quickly and iteratively replan and reforecast, so in response, we customized a product package designed to support those specific needs," Chancellor said. "We also maintained ongoing collaboration with customer teams to help them optimize spend — by identifying redundancies or underutilized resources, for example — so they could limit ad-hoc budget cuts and still maintain a position of strength in uncertainty."
Apptio declined to comment on its 2020 business metrics. Apptio went public in 2016 and then private again in 2019. Chancellor said the company has plans to announce more strategic partnerships in the new year.