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DigitalOcean S-1

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Re: DigitalOcean S-1

#221

Post by heliodor »

Thaxll wrote: post #163
heliodor wrote: post #125

Earlier quoted context omitted.

Read through the comments. There are plenty of them stating what they love about DO.

I don't see why you would use DO it's vastly inferior to every cloud provider, the only reason people use DO is for the price, it's cheap compare to AWS, Google or Azure.

That's okay, the comments can prove illuminating. People like the documentation. People like the simplicity. People like the UX. And more. Give the comments a read.

If you value understanding how people make purchasing decisions, this is an opportunity to get some insight because as you can see, there's a lot more to it than what you were able to enumerate.

Seems you might be a software engineer. This should interest you because an engineer that understand the business end of things is immensely more valuable than a heads-down coder in the majority of tech companies.

Re: DigitalOcean S-1

#222

Post by alfg »

Thank you Digital Ocean! I've been a customer since the early days and had just a few problems, but they were quick to answer and address. I love the simplicity of their platform and will continue to use their services!

Re: DigitalOcean S-1

#223

Post by mgkimsal »

yannoninator wrote: post #50
mgkimsal wrote: post #43

Earlier quoted context omitted.

Doing anything with those big vendors is an absolute headache, and requires a lot of vendor-specific knowledge/experience, which is expensive (and their offerings are generally expensive and/or harder to estimate pricing on). DO/Linode and others are perfectly fine serving a sizable audience of users who do not need the complexities that those larger vendors offer. I struggled for days trying to add more disk to an e…

I think AWS LightSail is what you would want, also Cloud Run is also another option.

AWS Lightsail is not available on Azure.

And... there's nothing inherently horrible about lightsail, but if I've decided that's all I need, I may go with other companies that have that model as their main focus. If I decide I want more of the AWS infrastructure, I'd stay in AWS (or... GCP, or Azure, or whatever).

Re: DigitalOcean S-1

#224

Post by mywittyname »

jmull wrote: post #206
emgo wrote: post #165

The biggest threat to DigitalOcean is that AWS, Google, and Microsoft are all going vertical by designing and manufacturing their own chips. Over times they'll be able to get hardware for cheaper, and also more specialized hardware that uses less power. DigitalOcean will have to buy CPUs from Intel or Nvidia/ARM at a higher cost, and eventually maybe even from AWS or Microsoft, essentially giving money to their compe…

I think there's a lot of doubt whether, in the long run, doing your own hardware makes sense for a cloud provider. If you work yourself into a performance dead-end, you can spend billions and end up with a chip that isn't particularly competitive. Whereas if your supplier does that, you can switch suppliers. You could spend $X billion, end up with a chip that isn't particularly competitive and just have to eat those…

Plus you have to provide most, or maybe all, of the support for software. Not just making compilers and related dev tools, but also building and testing of pre-compiled binaries for popular OSS.

That's fine for a few major pieces of OSS, and for internal, cloud-only software (Redshift, BigQuery), but I don't think that concept scales well, or is particularly quick to adapt to market shifts.

Re: DigitalOcean S-1

#225

Post by yte15 »

sneak wrote: post #214
tgtweak wrote: post #136

Earlier quoted context omitted.

I'm really happy to see Ben and Moisey get this far. They are both extremely competent sysadmins and system architects too. They retained a lot of equity as well - good to see.

My experience is that not only did they start out as incompetent, they actively downplayed early security issues and outright lied about certain aspects of their products. I found major, glaring security/architecture issues with their main product early on, and was told by DO staff to go full-disclosure because it was working as designed. When I did so, DO lied about the impact on their blog. Those lies are still up:…

Your issue was exactly, and I mean exactly, what I had in mind when I said “learning experiences” upthread. I followed it closely. Linode painfully learned the scrubbing lesson as well - and DO was in a worse position to learn it at the time, being forced to throw the scrub write load at SSDs that don’t like that type of load. That’s the real issue, honestly, that they probably started noticing SMART warnings from scrubbing by default on SSDs (particularly for cheap instances that turn over often), and took the venture capital approach of taping over it to make the next round by making it opt in.

It’s a tough problem to deal with and not something you’re likely to think of designing such a product from first principles. That’s not an indictment, it’s just fundamental to experience gained doing this stuff (and it’s perilous to get wrong). Filtering unsolicited ARP to prevent domUs from hijacking default gateways was another lesson in blood, and one of the first things we tried within five minutes when we did competitive on DO around launch time (they hadn’t thought of it; it worked).

Re: DigitalOcean S-1

#226

Post by Zelphyr »

I love DigitalOcean and would prefer to build my new project on their platform. Unfortunately, the one and only thing that is keeping me from doing so is their support. It's great, don't get me wrong. Whenever I've contacted them I've gotten helpful responses.

However, for this particular project I feel like it is important to be able to get a human on a phone when I need support. If they offered that, I'd move away from AWS in a heartbeat.

Re: DigitalOcean S-1

#227

Post by mywittyname »

libria wrote: post #190
emgo wrote: post #165

The biggest threat to DigitalOcean is that AWS, Google, and Microsoft are all going vertical by designing and manufacturing their own chips. Over times they'll be able to get hardware for cheaper, and also more specialized hardware that uses less power. DigitalOcean will have to buy CPUs from Intel or Nvidia/ARM at a higher cost, and eventually maybe even from AWS or Microsoft, essentially giving money to their compe…

> AWS, Google, and Microsoft are all going vertical by designing and manufacturing their own chips What are the GCP and Azure equivalents of AWS Nitro?

For GCP, it depends. GCP doesn't have a Nitro competitor, but they offer Tensor Processing Units (TPUs). TPUs are more of a competitor to nVidia chips, but they are still custom silicon in the sense of the GP comment.

GCP, AWS, and Azure seem to all be diverging in their specialization. GCP is focusing more on AI/ML/Big Data offerings while AWS is more security-aware, and Azure is more hybrid-cloud focused.

Re: DigitalOcean S-1

#228

Post by kevinoconnor7 »

neom wrote: post #32

Interestingly it was very clear at around $10MM ARR that DO was on a trajectory to IPO. You can thank Moisey Uretsky for a fantastic product idea and his brother Ben for CEOing it for so long. Congratulations to everyone who was involved in building DigitalOcean, it was an INCREDIBLY wild ride in the early days, lots of chaos but through all the chaos and disfunction, I think everyone involved knew this day would com…

I remember interviewing with DO back in late 2014 and it was nuts! The entire interview process took ~3 months and it was clear that they were defining the process as they went. The entire process was basically:

  1. initial call with recruiter
  2. homework project
  3. call with engineer to discuss said homework project
  4. two phone screens with engineers
  5. onsite interview with 6 engineers
Finally I had was at the final step which was a call with Ben who was really interesting to talking to as we shared the sysadmin background.

They we going through some pretty crazy growth at the time so I forgave a lot of disorganization in the interview process. Unfortunately I didn't end up getting the role but I'm glad to have had that experience; it was definitely an interesting point in DigitalOcean's history.

Re: DigitalOcean S-1

#229

Post by aeturnum »

firstfewshells wrote: post #167
breck wrote: post #44

Here are the problems I've had in my 7+ years as a DigitalOcean customer: . Those are the ones just off the top of my head. Love this company and it's made my life so much easier for the past near decade. Excited to see they are financially very healthy.

They've accrued up losses of $43M, $40M and $35M in the 3 preceding years. Funny how that's considered financially healthy in the world we're living right now.

I think it's good to point this out and think a little about what "health" means here. Looking at their consolidated financial data on page 11, you can see they spend about $1 providing a service someone pays $2 for. Then all the rest of it gets eaten up by salary, r&d and marketing.

It feels like a very different situation than, say, Uber - where there's a question about if Uber can balance driver payouts and customer fees in a way where they make money. DO, instead, is already turning $1 in goods into $2 in revenue and they're just looking to grow enough so that $1 in potential profit covers everything.

Re: DigitalOcean S-1

#230

Post by ttul »

firstfewshells wrote: post #167
breck wrote: post #44

Here are the problems I've had in my 7+ years as a DigitalOcean customer: . Those are the ones just off the top of my head. Love this company and it's made my life so much easier for the past near decade. Excited to see they are financially very healthy.

They've accrued up losses of $43M, $40M and $35M in the 3 preceding years. Funny how that's considered financially healthy in the world we're living right now.

So long as the investment into growth (sales and marketing) is paid back through the cashflow of customers during their lifetime, the losses are tolerable.

A provider like DO expects to have customers for many years. At 50% gross margins, $100 spent to acquire a $50/yr customer will be returned in four years. That may be an acceptable trade off.

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