Redis Labs Raises a $60M Series E Round

https://techcrunch.com/2019/02/19/redis-labs-raises-a-60m-series-e-round/

188 98 7 years ago

mushufasa• 7 years ago

How many letters can you do? F, G, H?

antirez10• 7 years ago

The idea is to follow plain ASCII given that Redis handles strings as binary blobs. So after round Z we are going to do round [, followed by \ and ].

wolfpwner• 7 years ago

So Series A is already the 65th round, right?

alexpetralia• 7 years ago

Series ¯\_(ツ)_/¯

jdp23• 7 years ago

There was a software tools company in the 1990s that got up to Series AA. I remember thinking "please don't let this ever happen to my startup".

redisman2• 7 years ago

Wow AA round? I'm guessing the founders had no equity left after the first 10 and were just throwing money into a pit.

redm• 7 years ago

I wonder if this raise is to continue scaling the existing product customers/add runway or to expand its's scope to something new.

virtuexru• 7 years ago

From the article: "the company plans to use the new funding to accelerate its go-to-market strategy and continue to invest in the Redis community and product development."

antirez10• 7 years ago

Well from the POV of the open source Redis, also before this round, but even more now, Redis Labs is going to continue to sponsor me, Fabio Nicotra, and other folks around the OSS part doing community/patches/...

I think that part of the round will also serve to put more efforts in the Redis extensions provided as modules. Incidentally I need to extend the modules system a lot more, especially with "hooks" so that modules can capture any command execution, because yesterday I wanted to implement the Gopher protocol as a module and I could not do that easily without spawning a thread to listen to some other socket, and remained hardly disappointed.

jacquesm• 7 years ago

I hoped you'd be beyond the need to be sponsored by now!

trjordan2• 7 years ago

Yes, always, both.

There's almost certainly a non-trivial sales team spend here. Redis Enterprise isn't a decision that organizations take lightly, and databases aren't cheap. Mongo is public on a similar model, so there's almost certainly enough room to grow with their current offerings (licenses and hosting).

Based on 238 employees, they're probably at $25m+ in revenue. Many companies start to think about a "second act" at this point, but few of them actually pull it off. So we'll probably continue to see improvement around the core product and a slew of new integrations, but I'd be surprised if they came up with a totally standalone new product that's worth $X0,000,000 / year in short order. There's too much to do with Redis itself and the hosting platform to devote so much effort to a brand new effort.

markdoubleyou2• 7 years ago

I wonder what VCs expect of Redis Labs now that they've raised a total of $146M. Let's say the VCs are shooting for a 10x return... does that mean everyone's expecting a sale/IPO for $1.5B (with revenues of maybe $25M/year)? It took RL 7+ years to get to this point, so what do investors see that I don't see?

misiti37802• 7 years ago

what do they offer that the amazon version does not ?

antirez10• 7 years ago

The things I like more as an "external" person given that I handle the OSS part and I'm not directly involved in the internal products development, if not as a technical advisor, are:

1. Transparent clustering. You talk to that thing like if it was a single instance and it scales to the cluster. Failover and so forth happen automatically. It'a a lot higher level than Redis Cluster (which also they support as a protocol), there are good and bad things in the different designs, but I like how well it works.

2. CRDTs store for multi master, also across far geographical area.

3. Redis on flash, using different persistent memory types. This feature originated from an early experiment I did years ago, called "diskstore", then Redis Labs worked at it many years and reached a quite cool thing.

4. All the above can be installed in your servers if you want very high memory setups that is impossible to pay for on the cloud.

5. The various modules like RedisGraph, RedisSearch and so forth are only available in the Redis Labs cloud (or you can install manually on your server). Some of those modules like RedisGraph is receiving years of development.

6. I know that the support team and everybody at Redis Labs really knows Redis. Which was one of the main reasons eventually I joined the company. So I think they are able to handle core-level issues for every user having troubles. A lot of Redis operational improvements came from Redis Labs core/support team after investigating issues with customers.

AFAIK those are the stuff I like more from the external but honestly they do a number of things I don't know very well for certain big customers.

Thaxll• 7 years ago

Amazon actually doesn't run the same Redis as the rest of us, I wouldn't be surprised if they re-wrote a lot of parts of it. They probably re-wrote the storage engine ect ...

louthy• 7 years ago

wouldn't be surprised
probably

Hmm, anything of substance, or is this just pure speculation?

foodandsport2• 7 years ago

I use the Redis service. It's way less expensive. around a 90% less expensive for me. It has all of the high end features. Fault tolerance, etc.

AWS does not compete on price or performance and the Redis servers are hosted directly in whatever cloud facility you'd like.

On final note. Since setting it up, I've never had to look at it again.

Rafuino• 7 years ago

Do you use Redis on flash by chance? I'm guessing it could help reduce reliance on more expensive memory-heavy servers (and their higher cost), but I don't hear often about real experiences with the enterprise version of Redis.

kabacha• 7 years ago

Free plan of 30 concurrenct connections and 30Mb of memory is pretty cool and plenty for small projects!

misiti37802• 7 years ago

so now we are down-voting people for asking useful questions?

miguelmota• 7 years ago

From the license page: https://redislabs.com/community/licenses/

Is Commons Clause open source?
According to the Open Source Initiative (OSI), open source licensing cannot limit the scope of a license – it only applies conditions to exercising it. With this model, no one can stop you from doing whatever you want with the software, whether commercial or non-commercial, or (famously) good or evil. Therefore, the no-sale restriction imposed by Commons Clause means that any software under this new license is non-open source by definition. However, in practice, Commons Clause only adds a limitation concerning fair use, and we believe that both licensing approaches share the same core value of making software available for use by anyone.

That's a long way of saying the new license is not OSI-compliant. The new license is BSD with a common clause which according to the president of OSI, this clause instantly renders it non-approved.

https://www.zdnet.com/article/open-source-licensing-war-comm...

symisc_devel• 7 years ago

Redis Labs CEO Ofer Bengal told me the company’s isn’t cash positive yet. He also noted that the company didn’t need to raise this round but that he decided to do so in order to accelerate growth. “In this competitive environment, you have to spend a lot and push hard on product development,” he said.

I'm always amazed how startups like this where R&D practically cost nothing are not profitable yet after years in the market and thousands of customers. C'mon guys 99% of the work is already done by antirez and the open source community.

Scarbutt• 7 years ago

* C'mon guys 99% of the work is already done by antirez*

Yes, but maybe he's not a business man or is not in his interest to pursue the road of something like redis labs.

carlosdp• 7 years ago

That wasn't really the original commenter's point though...

antirez10• 7 years ago

Basically what happens is that even if you start to be cash positive, you want to get a bigger company, so you need to scale a lot the sales team and the customer support team, so you spend more money in order to end with more customers, not caring about the short term profitability. This is common to most startups basically.

Btw the Redis Labs development team at this point is quite large, because Redis open source is the core, but the company produces a number of things in order to provide a good managed Redis experience, all the additional features and modules, and so forth. But even so, I think it is accurate to say that most money in most companies of this kind will go to orchestrate the company at a different level, not just R&D.

ljm2• 7 years ago

even if you start to be cash positive, you want to get a bigger company

I am really interested to hear how you would square this against, say, Bssecamp's modus operandi.

How would you define 'enough'?

skywhopper• 7 years ago

These companies are intentionally walking a careful line of spending a ton of money to create a market-leading product and to capture as much of the market as possible early on. They could easily be cash-flow positive and take on less investment, but it's also very possible that competing products or service providers will overtake them or become dominant in the market they are trying to establish for themselves.

So you don't want to miss out on the opportunity to be the big fish in your pond (you may be unable to keep making money in the long term if you aren't the market leader), but you don't want to grow your costs so fast that you can never catch up.

That's the balancing act being played. And your early-stage investors who have lots of control will push hard to play it aggressively in later stages, because they want to make huge returns. And when there are people out there willing to give you tens of millions of dollars and by extension several years more guaranteed life of your company without you having to do the hard work to hammer out actual profit anytime soon, it's going to be hard if not impossible to turn down.

zzzcpan• 7 years ago

but it's also very possible that competing products or service providers will overtake them or become dominant in the market they are trying to establish for themselves.

It's not really possible, they are just playing the startup game. Honest non Patreon sounding justifications are pretty hard to come up with at this point.

zachsnow• 7 years ago

99% of the job building the core tech; the other 99% of the job is sales, support, account management, marketing, etc.

It’s never just the product, no matter how much we builder types might like.

(No idea whether 60M is the right number for the rest though.)

1stcity3rdcoast• 7 years ago

That adds up to 198%, but that’s effectively correct when you’re scaling up a company!

sk5t• 7 years ago

Sometimes writing the code is, like, 10% or 20% of the work. Everything else--marketing, hiring, lead gen, legal, accounting, billing, contract negotiation, compliance, on and on--while not creative work, absolutely and disappointingly cannot be ignored.

Waterluvian• 7 years ago

Companies suffer from Mrs. Armitage's Bike, where they're not happy with what they've got and need more. I wish more companies could just do one thing well and scale to whatever size it is that does that.

mbesto• 7 years ago

I'm always amazed how startups like this where R&D practically cost nothing are not profitable yet

S&M is a helluva drug. Notice something common about the "Other SG&A" in all of these?

https://www.marketwatch.com/investing/stock/mdb/financials

https://www.marketwatch.com/investing/stock/cldr/financials

https://www.marketwatch.com/investing/stock/rht/financials

At the end of the day, DCF is really what matters and DCF != profit

nunez• 7 years ago

C'mon guys 99% of the work is already done by antirez and the open source community.

That's the problem. Enterprising open-source stuff is really hard. Either you're selling support for already-open-source stuff, or you're selling an enterprise variant with extra goodies and throwing a support plan on top of that.

nindalf• 7 years ago

99% of the work is done by antirez and the open source community

Redis Labs employs antirez and therefore sponsor the open source work on redis. At least a part of this VC money is going towards making a great open source redis. As a user, that makes me happy.

https://redislabs.com/team_post_type/salvatore-sanfilippo-le...

ris• 7 years ago

Hmmm. The more money companies raise, the less honesty we tend to see from them.

rsweeney21• 7 years ago

Speaking to a room full of CEOs at a summit, the CEO of Chegg once said "If you are raising a series F, it means what you think it means."

dpflan2• 7 years ago

Is there a break down somewhere of what each series should signify?

dpflan2• 7 years ago

Starting a list:

https://www.investopedia.com/articles/personal-finance/10201...
https://medium.com/datadriveninvestor/understanding-startup-...

lquist• 7 years ago

This. The only exception being if the round is measured in billions. Cf Uber, etc.

btian• 7 years ago

What does it mean?

Tesla raised Series F in 2009, and it's still alive.

adventured• 7 years ago

Workday also raised a series F.

They're presently worth $42 billion with $2.1b in sales, 172% sales growth over three years, and are likely set to be another enterprise software juggernaut.

It clearly doesn't inherently mean anything. What matters is whether the business is growing properly versus the capital being consumed. If more capital will reasonably accelerate growth further, feed the business more capital (depending on what the owners want to pursue of course).

mychael• 7 years ago

As a customer, this is unfortunate news.

Why is it so hard to just supply an honest service in exchange for money and take a nice profit?

mavdi• 7 years ago

You’re getting downvoted but I too hate the world domination plans of every single successful start up.

redisman2• 7 years ago

Reminds me of being promoted until you fail. Growing and creeping until you fail to deliver the core service you were the best at. HN skews hard to the unicorn-or-bust mentality for some reason.

ajmurmann• 7 years ago

It is so hard to do this because of VC money. Once you have taken the VC money success is not an option anymore. You must be super successful and ideally wipe out all competitors!

If I'd start my own startup and don't take VC money and the company makes $300k-$500k profit per year, I'd be ecstatic and happy to stay at that level forever. Maybe I'd focus more on reducing my own time spent at some point, rather than growing more. For a VC that's the same as failing. They invest in a wide range of companies and they need to get some major cash out from the successful companies. There also needs to be an exit. That means IPO or sell the thing. The exit is needed because the fund has a set lifetime. After that the shares go to the fund investors. For years you had A16Z representing, now you got a bunch folks you never heard of. Neither you nor those people want to deal with any of that.

If you have an IPO the treadmill continues, because our economy is about exponential growth and not sustainable, steady income. That pattern is even reinforced by our tax code. Capital gains < income tax. I can defer capital gains by not selling. Don't give my dividends! Those get taxed immediately!

ww520• 7 years ago

I really hope they succeed. Redis has real solid tech that has helped tens of thousands (millions?) websites scaled.

the_common_man• 7 years ago

Does anyone know how much redis enterprise costs?

jillesvangurp• 7 years ago

Price transparency is not optional for SAAS products. Seems to be a well kept secret on their website. Instant turn off for me. It means there are hidden costs, special deals at the discretion of some sales person, and other sales BS you have to deal with. I see this as an anti pattern for a SAAS service. We pay for lots of SAAS stuff at the company I run; we don't talk to sales people for any of that stuff ever. We engage with their support when stuff is broken. But not sales.

Redis is a great product but I fail to see the valuation that comes with a 60M investment (a billion+?). Yes, the cloud offered variety could potentially be interesting but competing products are available and this seems to be a commodity product running on commodity hardware. AWS already offers it so do others, I believe.

etaioinshrdlu• 7 years ago

Redis Cloud is the very definition of a great cloud service. Cheap, easy, reliable, scalable up and down with no downtime. Can be placed in your same AWS region.

coleifer2• 7 years ago

I love Redis, but I'm a bit skeptical of some of the changes that are currently in development. The respv3 protocol has some features that, while they sound neat, also could significantly complicate client library code. There's also a lot of work going into a granular acl. I can't imagine why this would be necessary, or a higher priority than other changes like multi-thread support, better persistence model, data-types, etc.

pupdogg• 7 years ago

The good thing is that you have a direct line of communication with the developer himself, @antirez on this portal or GitHub. From what I know, @antirez calls the shots on what gets implemented in Redis core...NOT Redis Labs. After reading several technical/non-technical posts at http://antirez.com, I can confidently say that his decisions are always sound and justifiable! We love you @antirez!

antirez10• 7 years ago

So nice words, thanks! I'll go ahead after this encouragement to try to reply to the OP about why I'm doing certain things.

antirez10• 7 years ago

Thanks coleifer, I understand that the current development path may look odd, but it's definitely not the first time: the critiques for Lua scripting or Pub/Sub where much stronger AFAIK :-) However I want to really share what is the process behind and why certain features like ACLs are so important (for reasons very different than the ones you may guess I think, that is, no enterprise customers in need for security), and why RESP3 has out-of-band data channels support (even if they are not implemented by the server). I'll write a blog post today, and reply here with the address. Cheers!

P.S. I'll also address threading and persistence.

coleifer2• 7 years ago

Thank you for taking the time to respond so thoughtfully to my comment. If I had been talking directly to you, I hope I would have written something less entitled and expressed more gratitude for the gifts you've given the community, and which you continue to improve.

Redis is exactly the kind of software that gives me joy. Aesthetically and intellectually. Its pieces are orthogonal -- a word you used in your blog post. The code is small, tight, and well designed. It invites you to think more creatively. The lolwut command was also a very good innovation!

antirez10• 7 years ago

Ok finally I wrote the post, sorry for the delay: http://antirez.com/news/126 and thanks for the feedbacks.

_bpo• 7 years ago

Nice & succinct problem definition for why ACLs are so important for everyone:

Let me show you an example. You have a Redis instance and you plan to use the instance to do a new thing: delayed jobs processing. You get a library from the internet, and it looks to work well. Now why on the earth such library, that you don’t know line by line, should be able to call “FLUSHALL” and flush away your database instantly? Maybe the library test will have such command inside and you realize it when it’s too late. Or maybe you just hired a junior developer that is keeping calling “KEYS *” on the Redis instance, while your company Redis policy is “No KEYS command”.

Without ACLs we need to rely on command renaming or completely isolating databases to guard against errors. ACLs sound complicated but they're actually a solid user experience improvement.

Max_Horstmann• 7 years ago

Would it still be fair to say that Redis typically is used for things like caching, messaging etc (and it's amazing for that), but not as a primary data store? Or did I miss something?

sandGorgon2• 7 years ago

This looks like direct competition to Kafka. The technology behind Kafka Streams is solid and can probably give Kafka a run for their money (in fact Redis has more adoption than Kafka). However their product is not in the same quality range.

Hopefully this should fix it.

tbrock• 7 years ago

Surely you jest. Redis is less stable than kafka? I must have missed something.

sandGorgon2• 7 years ago

I didn't say it was less stable - I said that the product has less features. And I mean product in the larger sense of things - management tools,etc etc. Similar to the Confluent Platform - for the streaming usecase.

oarabbus_• 7 years ago

A wise man once said "you don't want to raise a series D and certainly nothing after that"

ralusek• 7 years ago

What is the longterm path for things like Redis Labs, Mongo, and Elastic, etc? They all seem to have an open source database which they in turn monetize by offering as a DBaaS. But can they really bet against AWS in the long run?

Elastic's own cloud ElasticSearch is better than AWS's notoriously bad implementation, but what if it wasn't? Elastic's cloud offering runs on AWS and other third party offerings, so all it would take would be AWS reaching relative parity in quality, and they would then surely have the upper-hand by being the cloud infrastructure their own offering is run off of. I feel like the same is true with AWS Elasticache vs Redis Labs. What if AWS reaches parity, but can additionally offer the ease of not managing 2 accounts, as well as the ease of co-locating the cache with the app server and putting it all in a VPC. What is the endgame for these DBaaS when they have AWS copying their work?

davman• 7 years ago

The longterm path is to relicense with https://commonsclause.com/ and prevent AWS from selling the software as a platform.

hannob• 7 years ago

Again this bullshit:

“When we came out with this new license, there were many different views,” he acknowledged. “Some people condemned that. But after the initial noise calmed down — and especially after some other companies came out with a similar concept — the community now understands that the original concept of open source has to be fixed because it isn’t suitable anymore to the modern era where cloud companies use their monopoly power to adopt any successful open source project without contributing anything to it.”

Okay, so here's the thing, at FOSDEM this year there were multiple events around this issue, and I haven't seen a single person defend the stance of Redis and others. Also the original concept of open source is doing fine, thanks. The problem is a couple of overvalued, VC-backed companies that found out they don't have a business model that is compatible with the promises they made to their investor.

avip• 7 years ago

This is weird. I just came back from a gun rights rally in AZ, and haven't seen a single person defend the stance for gun control.

Aeolun2• 7 years ago

I’m not sure there’s people in the world that benefit from Redis’s stance other than Redis.

antirez10• 7 years ago

IMHO it's important to take the quoted words into the context. And the context is:

1. Redis Labs anyway pays me full time and Fabio Nicotra (prat time) to just do BSD code. So they are not taking away anything from the OSS part.

2. Internal devs at Redis Labs submit pull requests to the Redis core BSD code base.

So this whole discussion is centered around modules, that is, their POV is that in the cloud era you have to do also things under different licenses. Now it's perfectly licit to disagree with that, however it's important to realize that Redis Labs is not taking away anything from the OSS effort around Redis, it's actually paying for such BSD code. Yet Redis Labs for some reason is getting a lot of criticisms despite other systems went completely non-open-source, core + accessory things. Something does not add up IMHO.

tomnipotent• 7 years ago

The problem is a couple of overvalued, VC-backed companies

No, the problem is exactly what the source mentioned. When FOSS became a thing, cloud computing wasn't even an infant thought and the licenses that spawned during the era addressed only known factors.

I haven't seen a single person defend the stance of Redis and others

How many of them are in this situation? Not really interested in the opinions of people that don't have skin in the game, and I'd wager these people don't have product's being exploited by cloud provider.

We have large businesses exploiting open source software (thanks to dated licenses) to make profit off the back of open source communities, while contributing little-to-nothing in return.

Fuck that. I didn't adopt Redis Postgres, or MySQL so that Amazon and Google could build off decades of good will to make money from them. They've all made significant improvements to these services, but refuse to add that value back into the community despite the fact that the opportunity only existed because other's worked for free.

So it's ok for cloud providers to profit from FOSS projects, but not ok for the original authors? Shameful, this attitude is absolutely disgraceful.

Please stop using open source if you don't also advocate for FOSS authors to reserve the right to try and profit from their work in a way that's compatible with the greater FOSS community.

Redis Labs Raises a $60M Series E Round

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