Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

We raised a bunch of money

fly.io

Post reply on HN
Print view View original

211–220 of 484 posts

Re: We raised a bunch of money

#211

Post by cphajduk »

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…

I would partially disagree. I think your statements are true, but only for companies that raise investments on the promise of scaling to greater profitability, but ultimately fail to deliver. If the founders delude themselves or are overly optimistic, the only recourse they have to investors is to gouge the customer.

Raising the 'right' amount should be the goal. Not 'as much as possible'

Re: We raised a bunch of money

#212

Post by danielrhodes »

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…

I can understand how you might think investors mis-align the business with customers, but this isn't necessarily true.

First, businesses aren't in the business of leaving money on the table. That is fine for a non-profit, but ultimately they need to weigh money making with customer satisfaction and growth. It's crazy to think a business should not optimize here.

Second, you're conflating venture-funded consumer businesses with B2B businesses. Consumer businesses with venture funding are typically going to fuel growth/momentum by doing things which don't scale. But eventually push comes to shove. B2B business models are usually more transparent about what is a promotion and what is not. Consumer businesses don't always know how the business model is going to play out to even offer that transparency.

Third, if your business model is advertising and data is your moat, then when you give away your data via API to promote distribution, yes you run into an issue later on when you need to advertise or you have underinvested somewhere (in Reddit's case it was mobile). For Reddit or Twitter, these mobile apps were profiting off their users/data while taking on none of the costs (infrastructure, moderation, etc.), and limiting their means of monetizing themselves. You don't need an investor to tell you that isn't in your long term interest.

Re: We raised a bunch of money

#213

Post by Zetice »

AndrewKemendo wrote: post #205
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…

> 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

I am so curious why you repeatedly spit in the collective face of the millions of small business owners in the US and around the world.

If what you say were true, the world would exist as a series of 3-5 megacorps, and small businesses would not exist. Since they do exist, how do you square that with your claim that only the "extremely rich would be able to start a business of any size" is currently true?

Re: We raised a bunch of money

#214

Post by [deleted] »

comice wrote: post #203
tptacek wrote: post #160

Earlier quoted context omitted.

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.

[deleted]

Re: We raised a bunch of money

#215

Post by tptacek »

comice wrote: post #203
tptacek wrote: post #160

Earlier quoted context omitted.

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.

You get that there's a whole section of this post headlined "Why We Raised A Bunch Of Money", right?

Re: We raised a bunch of money

#216

Post by jacobsenscott »

tptacek wrote: post #158
jacobsenscott wrote: post #155

How is fly.io different (or even better) than just fronting your entire app, including the dynamic content with cloudfront or another CDN? The CDN is close to the client giving you low latency ssl setup, which can be significant. I get that this doesn't push your app servers to the edge, but even if you did that you still pay the latency cost of hitting your database in the bunker in Virginia. For many (most?) apps t…

The exact opposite: we're a fullstack platform, so our target audience is largely people who don't just host static Javascript.

Maybe I'm mis-understanding the "Deploy App Servers Close to Your Users" thing. I don't get how moving your app servers far from your database makes things faster. Typically the app is more chatty with the db than with the client. So it is better for your app and db servers to be close together, even if they are far from some segment of users. If fly made distributed databases "heroku easy" that would be impressive, but it seems that's not a part of the offering? https://fly.io/docs/database-storage-guides/#other-storage-a...

Re: We raised a bunch of money

#217

Post by kkielhofner »

kortilla wrote: post #82
kkielhofner wrote: post #56

Earlier quoted context omitted.

People forget AWS is 20 years old. When I routinely remind people of that fact they often remark (incredulously) with "WHAT? Really?" When I think about it the entire paradigm of "regions" itself seems completely antiquated in the grand scheme of things. AWS has made a few moves on this but in the end you're largely still tied to this fundamental regional concept in terms of control planes, etc and you incur the ridi…

The realities of regions don’t go away. It’s a primitive to save you money. If a new entrant doesn’t have it they are either just operating in one region or you’re paying cross-region prices for everything.

Cloudflare products and pricing (what I'm most familiar with) are in wild opposition to this view.

I've never seen anything even remotely hinting at region or geography in their product line other than geo-routing for load balancing products, headers with geo info for you to do something with, etc. They include the serving "POP" in headers for diagnostic purposes but other than that you have no idea.

Where do my Workers run? Don't know, don't care. They are substantially cheaper and offer better availability and response times than their region-based "cloud" competitors. Same for KV, D1, R2, and anything else they come up with as they move further and further in (out?).

One would expect with them having the ability to allocate supporting hardware dynamically and globally their cost basis is substantially better than having customer facing and controlled region-based resources that still need to be built out for product support (regardless of usage) AND maintain the excess capacity local to each region to be anywhere near "elastic".

Re: We raised a bunch of money

#218

Post by AndrewKemendo »

Zetice wrote: post #99
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…

Honest question: why are you on a site whose community is literally created and run by a startup accelerator? It's a given you realize how antagonistic you're being here, so I guess my only other question is why seek attention like this?

[flagged]

Re: We raised a bunch of money

#219

Post by tedmiston »

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…

> 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 customers and employees (primarily) in the extreme long term?

To be fair, the fate of most of them is actually to fail. Hence this amplified effect of why VCs need such a standout massive return to make the fund model work.

That said, while it seems like it to us normal folk, in the grand scheme of VC, $25M is not really "a bunch of money". In 2021, a16z led or co-lead $3.2B [1] in funding rounds. I can't find a publicly available stat for how many rounds that entailed, but napkin math says 100–300. Of course the distribution is not linear, but if we take the 200 investments midpoint, that's a $16M check on average.

The additional $70M here follow-on is the real story. It looks like they are not giving it a label, though Crunchbase lists the $25M from a16z a year ago as Series B, so I'm inclined to call this new round the Series C.

> My new heuristic is that I avoid every single company that raises venture funding.

IMO tech, startups at least, are not long-minded like this in general. Companies regularly come and go in 6–24 months. Good luck convincing the current and next waves of CTOs of not using venture-backed tech [that saves them tons of time for great prices right now]. And then portcos also often make deals with other portcos... the cycle feeds itslef in more ways than one.

It's like trying to change the color of the ocean with one single cup of red dye. At the end of the day, this is just a rounding error.

But also, Big Tech will end up acquiring many of the standouts a la Firebase or Heroku. Resisting the model won't upend or stop it.

[1]: https://news.crunchbase.com/liquidity/under-the-hood-a-decad...

Re: We raised a bunch of money

#220

Post by danenania »

xNeil wrote: post #89
mrkurt wrote: post #49

Earlier quoted context omitted.

The simple answer is: we sell something people want to pay for (VM time, network services, etc). We'll obviously want to improve our margins over time, but there's a market price for this stuff and we don't have pricing power. I don't think you can build an interesting public cloud without raising money, unfortunately. At least, not without jumping back in time 25 years and starting then.

Yeah no I have to agree with you on this one. Every company is going to raise prices at one point or another - it might be inflation, it might be profit-chasing, padding for an IPO - whatever. Just because a startup might raise prices in the future shouldn't stop you from using their products - with a caveat, that is, how easy it is to shift to another operator. I haven't used fly.io personally, so I don't know about…

I can’t speak to other features, but if you just want to run docker containers in the cloud, fly is about as close to zero lock-in as it gets.
Post reply on HN