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We raised a bunch of money

fly.io

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Re: We raised a bunch of money

#201

Post by sfitz »

donmcronald wrote: post #121
gotmedium wrote: post #88

Earlier quoted context omitted.

If that is the case, then you shouldn't be using Apple, Google, Intel, Nvidia, Stripe, Shopify, Meta, Git, etc etc. Companies raise money now to generate cash flows in the future from a wildly risky innovation. Assuming the thesis is correct, the company will then to pay it back to investors (VCs and their investors including Endowment Funds), but also employee and taxes. As companies grow, they pay more taxes, and t…

How does Git fit with the rest of those?

speculating they mean source control providers like github, gitlab, bitbucket, and not actually 'git'

Re: We raised a bunch of money

#202

Post by heipei »

KptMarchewa wrote: post #191
dadrian wrote: post #172

Earlier quoted context omitted.

You raise money to pay for costs of running the business. If you couldn't raise money, then only people who are already extremely rich would be able to start a business of any size, let alone one that requires deploying physical hardware in multiple regions. Good luck getting even four regions for less than $1M. The world would be far worse off if all tech businesses had to be bootstrapped. That being said, there's c…

To add to it, without external funding _any_ innovation would be stifled by existing players. If you can't even get low millions in funding, existing corporations with tens of billions of free money will eat you alive. Organically growing a business; bootstrapping sounds fine, until you try to do something that potentially has any global impact.

It's funny to hear this in this context. Fly is treated as one of the few potential successors to Heroku, and Heroku raised very little money while remaining the number one choice for most devs here (based on sentiments). And then an existing corporation with tens of billions of free money came along, bought Heroku ... and ran it into the ground. So I don't buy that you need to fundraise or else be outpaced, at least not by big corporation.

Re: We raised a bunch of money

#203

Post by comice »

tptacek wrote: post #160
comice wrote: post #156

Earlier quoted context omitted.

> We’re all adults here, we can talk about this stuff, right? proceeds to not really talk about it

What more were you hoping to hear? We were really blunt about it. We wrote this post in attempt to sign Alcoa as a customer.

as the OP says:

> but what are you giving away for this? Are founders selling their shares? Where is the beef? $70M can be everything and nothing at the same time.

Re: We raised a bunch of money

#204

Post by [deleted] »

flagged24 wrote: post #174
berkle4455 wrote: post #106

Earlier quoted context omitted.

I don't think they they'll need to increase, fly.io is already rather expensive as far as cloud offerings go today: shared 8 vCPU / 16GB VPS is $85/mo at fly, Hetzner is $16/mo for the same.

It's worse. For a 16 vCPU + 32GB RAM + 20TB traffic (fly.io has max 8 vCPU) I would pay around $750 on fly.io instead of €30 on Hetzner. People are willing to pay a lot for I guess an easy deploy story ?

[deleted]

Re: We raised a bunch of money

#205

Post by AndrewKemendo »

dadrian wrote: post #172
Solvency wrote: post #92

Earlier quoted context omitted.

This is the cold truth. The entire process of raising money in the modern software world has nothing to do with creating a better product and business specifically. It's simply the de facto step-by-step playbook process one follows if one is an entrepreneur with the eventual become very rich. There is nothing novel, innovative, or remotely surprising about this process. It is well defined, well established, and simpl…

You raise money to pay for costs of running the business. If you couldn't raise money, then only people who are already extremely rich would be able to start a business of any size, let alone one that requires deploying physical hardware in multiple regions. Good luck getting even four regions for less than $1M. The world would be far worse off if all tech businesses had to be bootstrapped. That being said, there's c…

> If you couldn't raise money, then only people who are already extremely rich would be able to start a business of any size, let alone one that requires deploying physical hardware in multiple regions

You’re describing the current state of the world

We’re there already. The entire system is built to exploit everybody who does not have significant capital to fight back against it

Re: We raised a bunch of money

#206

Post by hn_throwaway_99 »

gtirloni wrote: post #186
hn_throwaway_99 wrote: post #136

Earlier quoted context omitted.

While I tend to agree with your overall thesis, and I get particularly baffled when some SaaS company, whose nearly sole expense is payroll, feels the need to raise hundreds of millions of dollars, fly.io is a cloud infrastructure company. They literally run physical servers all over the world (at least, that's my understanding from their website). I've got to imagine then that this business has huge capital costs, a…

> it's nearly impossible to grow a very capital intensive business without outside capital. That's the promise of pay-per-minute (or even second) cloud computing, right? You don't spend what you don't need _right now_. But Fly.io makes a good point about reaching critical mass to discuss better prices from their vendors. I can totally understand that.

> That's the promise of pay-per-minute (or even second) cloud computing, right?

Maybe I misunderstood your point, but that's the promise for cloud computing customers. Fly.io is a cloud computing provider, and those are all hugely capital intensive businesses.

Re: We raised a bunch of money

#207

Post by nirvdrum »

nradov wrote: post #175
Solvency wrote: post #122

Earlier quoted context omitted.

There is an entirely possible and alternative funding model that perpetually allocates a responsible amount of incremental funds for the purposes of novel R&D. It's trivial to imagine how a responsible incremental funding approach could create a better, more transparent, more estimable, more reportable, more mappable, more rigorously trackable innovation process. Raising massive lump sums of money is about VALUATION.…

That alternative only works in the absence of competitors who raise capital to pursue more rapid growth. It is an arms race to an extent, but if you don't play the game then you may get locked out.

Particularly when that rapid growth involves price dumping. I've bootstrapped businesses before. It's really difficult to compete with free offerings when you have to pay the bills. Your competitors can burn a pile of cash to flush out the competition. They don't even need a better product... people love getting stuff for free. Invariably, those services either go bust or don't remain free since it's often unsustainable. But, it means in the short-term you often need to raise money if you're competing with a VC-backed business.

Re: We raised a bunch of money

#208

Post by quickthrower2 »

AndrewKemendo wrote: post #45

Will you be publishing a follow up blog post about how you’re increasing API user fees once you’ve monopolized your particular market? Or how about how you’ll be increasing margins for investors in 5 years as you prepare for your IPO? Why won’t you suffer the fate of every single other tech company that raises a shit load of money which is completely and irrevocably selling out any pretense of being beneficial for cu…

They are a web hosting company, like AWS (etc.), so at least you can shift your stuff to somewhere else if it gets too pricey.

The "etc." is basically thousands of other companies.

Re: We raised a bunch of money

#209

Post by OriginalMrPink »

tptacek wrote: post #160
comice wrote: post #156

Earlier quoted context omitted.

> We’re all adults here, we can talk about this stuff, right? proceeds to not really talk about it

What more were you hoping to hear? We were really blunt about it. We wrote this post in attempt to sign Alcoa as a customer.

Really? What are you going to tell them after they signed? "You bought it, suckers!"

You might have found your audience. But for me the tonality of the post felt way off.

Re: We raised a bunch of money

#210

Post by styren »

mrkurt wrote: post #102
styren wrote: post #83

I'm really struggling to understand fly.io's path to profitability considering the relatively low margins for SMB/hobby clouds. They could have the whole world on their free tier but what happens when it's time for EQT to cash out? Can they build enough features to make fly.io a serious option for companies? I just can't see myself using it or pushing for it at any of the companies I've worked for unless it's a <5 pe…

I don't want to sound flippant, because this is hard as fuck, but the profitability path for us is reasonably simple: have good unit margins, attract customers, help them grow. We have good unit economics. The riskiest, most terrifying thing we've done is start with our own hardware. For dev focused infrastructure, what we need to do is attract a lot of devs, get them to take us to work, and then help their employers…

I'vve consulted for companies of all shapes and in many different industries and when it comes to container orchestration there are many hard requirements that platforms like Heroku or Render don't address. If you can carve out a niche for SMBs then great. Maintaining that lead in such a competitive segment with price sensitive customers is hard.

I have no doubt that fly.io is a market leader right now just judging just by optics, but I think it is hard to maintain that lead in this segment just as I think it may be difficult to go upmarket with this type of product.

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