News & Views

 

Our Investment In Fauna, The Data API For Client-Serverless Applications

Today we are announcing our investment in Fauna.

We believe that the next generation of applications will be serverless. Those applications can be completely new, “greenfield” applications – like a dynamic Jamstack web application, or they can be new functionality that is added to an existing application or service but leverages a rich mobile or web client with a serverless back end. We think of this model of development as the “Client-Serverless” model, and this represents the 4th generation of application architectures.

Fauna helps developers to simplify code, reduce (development and operational) costs and ship faster by replacing their data infrastructure with a single serverless API that is easy to use, maintenance-free, yet full-featured. Fauna is the data API for Client-Serverless applications.

As computing platforms evolve, new opportunities for developer and application platform products are created. Some patterns (like the client/server era) were brought about by new technologies (Windows, SQL Server and the Windows hardware ecosystem) while others were as existing technologies aligned against important use cases (such as the LAMP stack for web applications) and just became “the best way to do it”. At any layer of the platform stack, if you can align with (or better yet create) one of these rising tides it can help you scale more efficiently. Changes in infrastructure also create opportunity, such as what we’ve seen in the Data Warehouse market where Snowflake’s forward-looking bet on exploiting elasticity and scale of cloud infrastructure have enabled them to disrupt a large and existing market.

The database market is massive and there are always opportunities for new platforms to emerge and differentiate. However, this has proven difficult as it is expensive to build a new database and even more expensive to sell one. Nowadays, decisions around infrastructure are more and more driven by developers and so any new platform needs to win the hearts and minds of developers first and foremost. Without this, the only way to land new customers is going to be through a deep technical sales process. You can argue that most of the NoSQL era (Mongo for example) came about via more effectively targeting developers – via Open Source and having more approachable platforms that were on trend for where applications were headed.

So, it is somewhat of a straightforward formula for success in the database market: build a database and latch on to the most important trends and developer technologies. This is what Fauna has done and why they are so well positioned.

Developers are moving en masse to serverless architectures for new applications, marking the dawn of serverless as the next tool chain for building global, hyperscale apps. FaunaDB plugs in seamlessly into this new ecosystem and uniquely extends the serverless experience all the way to the database. This developer journey began with the move to the cloud, but Fauna has correctly identified serverless as the next frontier for cloud and has succeeded in building the database of choice for this new era.

FaunaDB is unique in the market combining the following attributes into a single data API:

  1. Focus on developer productivity: Web-native API with GraphQL, custom business logic and integration with serverless ecosystem for any framework
  2. Modern, no-compromise programmable platform: Underlying globally distributed storage and compute engine that is fast, consistent and reliable, with a modern security infrastructure
  3. No database operations: Total freedom from database operations at any scale

Consequently, Fauna has seen its developer community grow quickly to over 25,000 users over the past year and has developed one of the strongest brands within the serverless and Jamstack ecosystem.

While it is great to identify a massive opportunity with a differentiated product, the most important part of investing in a company is the team.

The two co-founders, Evan Weaver and Matt Freels are amazing engineering and product leaders who were instrumental in building a scalable, distributed system at Twitter, where they witnessed the signs of where the world was moving and went on to build Fauna to fulfill their vision. They built Fauna as a 100% remote team from day 1 with the right focus of communication and collaboration to enable a high performing team aligned on a common vision. With a lot of the tech industry talking about working remotely currently, Evan and Matt have been leaders in adopting the “future of work” and setting up a strong culture for success as the team continues to scale in the new post COVID-19 era.

Eric Berg, who recently joined Fauna as the CEO is somebody that I have worked with at Microsoft in the past, was a key leader at one of Madrona’s portfolio companies (Apptio) and most recently the Chief Product Officer at Okta. During his eight-year Okta experience, he took a pre-Series A company through IPO, developing an identity product no one was sure they needed into a huge success.

And of course, I am very excited to have the opportunity to work together with Bob Muglia again as the Chairman of the Board at Fauna. I have had the opportunity to work together with Bob over the decades, initially at Microsoft and more recently at Snowflake and am thrilled to be able to work with him again here. Bob and I share a common vision of Client-Serverless being the next generation application model – applications are composed of Internet connected services using standard REST and GraphQL APIs, the Jamstack and the browser being the universal client and a globally distributed database as a cornerstone of this ecosystem.

With such a stellar team, a great product and a massive potential opportunity, it is a no-brainer for me to want to be a part of this journey and that’s one of the main reasons we decided to invest in Fauna. Looking forward to this journey!

POSTED IN: Madrona News

Welcome Anu!

We are thrilled to welcome Anu Sharma to the investment team at Madrona. Anu brings to our firm the rare combination of leading cutting-edge products and scaling new services at Amazon Web Services, co-founding her own startup, working as a venture capitalist, and writing code for enterprise products as a developer.

I had the pleasure of meeting Anu at AWS’ re:Invent conference several years ago. We stayed in touch, along with a number of others at Madrona, like Soma Somasegar, comparing notes on technology trends and new company opportunities. Even more important than her rare combination of experiences, we were struck from the outset by Anu’s insightful thinking and strong culture fit with our approach at Madrona. Specifically, her team and people focus, customer orientation, collaborative and warm interactions, long-term thinking, passion for products and technology, and curious mind. So, fast forward several years, and we could not be more excited to have Anu joining our team.

Most recently, Anu led product management for AWS Outposts, a fully managed service that extends AWS infrastructure, AWS services, APIs, and tools to virtually any datacenter, co-location space, or customer premises. This experience squarely in the center of enterprise customers embracing the cloud computing model and hybrid clouds gave her incredible purview into many of the broader trends around the next generation of enterprise software infrastructure. Over the course of her 8 years at AWS, Anu also had the opportunity to work on a variety of other products, including EC2 accelerated instances and Firecracker, enabling many related technologies — such as machine learning and serverless — that underpin many of our most exciting investment themes.

Beyond this deep understanding of enterprise customers and cloud technologies, Anu previously was herself a co-founder of a company, LifeLemon, in the consumer apparel e-commerce space. This appreciation of what it is like to walk in the founder’s shoes is an invaluable asset as she now turns to helping entrepreneurs with their journeys. Further, in addition to stints leading marketing at Flipkart (their 40th employee) and a developer at Oracle, Anu also spent two years as an Associate at Softbank Venture Capital in India. This broad experience building products, founding and operating a company, and helping founders scale their businesses, in both enterprise and consumer segments, will allow her to bring a wealth of empathy, assistance and insights to companies in our portfolio and founders across the Pacific NW.

“Working with world class teams can be a once-in-a-lifetime opportunity, and Madrona has stood out as one such remarkable team for me. Involved from day one in building and scaling businesses, Madrona has been a genuine partner for young companies in the Pacific NW. I’m excited to be part of the team that has seen what growth at successful businesses looks like and is committed to partnering with founders focused on solving problems for their customers,” said Anu.

Anu has hit the ground running in her first week. She looks forward to meeting and engaging all of you in the Pacific NW innovation economy. Anu will work with our current portfolio and also work with founders who are in the early stages and are looking for a partner and funding to help grow their company. Look her up! Anu is particularly interested in next generation infrastructure services, intelligent applications, and financial services.

You can follow Anu on Twitter here: @anusharma.

POSTED IN: Madrona News

Welcoming Zeitworks To The Madrona Family!

Today, we are thrilled to announce a $4.5 million seed financing in Zeitworks, a company incubated at Madrona Venture Labs, that is automating process discovery, mapping and measurement. We are also excited to partner again with Ryan Windham – who previously was the CEO of Cedexis in our portfolio – and welcome our new co-investors JAZZ Venture Partners, and entrepreneur Spencer Rascoff, founder of Zillow.

Most investments we make at Madrona follow the time-tested model in which an entrepreneur pitches us his/her vision of how to change the world and we end up partnering because we believe that is the right team taking on an important market opportunity for which the time has come.  And we also need to believe that we can directly contribute to their success.   Occasionally, we have bent that model and incubated a company at Madrona via Madrona Venture Labs, that has a full fledged incubation program. Zeitworks is the outcome of one such collaboration in a space that we have a deep conviction in.

Intelligent applications have been at the core of our investing strategy for years.  The proliferation of data, and the ability to process it and derive insights has changed both consumer facing and enterprise facing experiences.  In the last couple of years we have seen this extend to automating tasks and we have become more involved with companies looking to change how work gets done, as evidenced by our investment in UiPath, the leader in RPA.  But understanding the work and the process is a required element to actually automating.

Businesses in every industry execute hundreds of repetitive business processes for wide-ranging use cases such as claims processing, employee onboarding, order processing, returns management, etc. to name just a few. The success of such processes, and in turn of the businesses executing those, critically depend on the efficiency of those processes and the ability to improve their efficiencies. However, in an overwhelming majority of cases, the processes are not documented – or, at least poorly documented – and not measured accurately enough. As a result, businesses struggle to understand the true costs of their processes, identify the bottlenecks and make improvements that would have the highest ROI.

Traditionally, process discovery and modeling has been largely manual – serviced by consulting firms such as Accenture, Deloitte, PWC, etc. – and as a result, costly and time-consuming. However, with every business undergoing digital transformation, automated discovery and measurement of processes is increasingly becoming key to success.

Zeitworks is building a process discovery/mining product to automatically map, measure, and improve business processes across all applications, without IT integrations, consultants, interviews, or workshops. The operative word here is “automatically:” Zeitworks collects data on user activity and events via desktop sensors, applies Machine Learning to automatically discover and map processes, and analyzes and measures those processes to understand, optimize and automate those.

While process discovery and mining is not new, what makes Zeitworks possible today is the convergence of three macro trends – (a) the availability of “infinite” compute thanks to cloud computing, (b) the ability to collect large volumes of high-fidelity data, and (c) the maturity of ML/AI techniques to identify patterns and extract unique insights. Capitalizing on advanced ML algorithms and the computing ability to process vast amounts of data, Zeitworks can help identify repetitive processes and provide insights into how they are being accomplished now and how they can be completed more efficiently. Equally importantly, Zeitworks requires no deep technology integrations, enabling teams to deploy the software and realize value in a matter of hours.

From a market need standpoint, the focus on digital transformation and increasing efficiencies is driving business users’ awareness of the benefits of analyzing and understanding their own processes.   We believe that Zeitworks will be a key enabler in that inevitable digital transformation of enterprises.

At Madrona Venture Labs (MVL), the founders Ryan Windham, Ben Elowitz and Matthew Holloway tested the idea behind Zeitworks extensively, with input from hundreds of prospective customers and us, while assembling a world-class team of product and technology leaders to go execute that vision. MVL continues to be core to our work with early stage founders – the MVL process includes both ideating and testing as well as partnering with a wide variety of technical and business founders – and Zeitworks is a great example of a world-class founding team taking on a market opportunity we have a deep conviction in.

We could not be more excited to partner with Ryan and team and we look forward to helping them build the next billion-dollar business in enterprise software!

 

 

 

POSTED IN: Madrona News

Embracing the Intersections of Innovation: Our Investment in Nautilus Biotechnology

(Sujal Patel and Parag Mallick, co-founders of Nautilus)

The code of life, biology and chemistry, have been constantly evolving for millions of years. The code of computing has functioned for less than 100 years. Today, those domains are coming together to transform the ways we understand and improve life and health. The biological and chemical sciences are intersecting with the computer and data sciences in precision medicine, digital pathology, proteomics and more. At Madrona, we believe these intersections of innovation will be at the forefront of major breakthroughs in research, analysis, diagnostics, clinical processes, preventions and cures. While our 25-year history has primarily been focused on transformations in information technology sectors including cloud computing, applied ML/AL, Software as a Service and Internet/e-commerce, we have more recently embraced opportunities where biotech meets infotech.

A company that embodies this emerging theme is Nautilus Biotechnology. Madrona has helped shape the company for almost four years, working together with founders Sujal Patel and Parag Mallick from day one. We provided office space and support for the company in the early days. We co-invested in the Series A with Andreessen Horowitz’s Bio-fund a few years back. And, today, Nautilus announced their $76 million Series B round with new investors including Vulcan Capital, Perceptive Advisors, Bezos Expeditions and Defy.vc.

What has drawn us to this investment theme in general and to Nautilus in particular? It is a combination of the expansive opportunities for scientific discovery, the scale, speed and agility enabled by modern compute and automation, and the continuous improvement in patient and disease understanding enabled by machine and deep learning. But, more importantly, it is a combination of founders in Sujal Patel who we have worked with for almost 20 years – first as the founder and CEO of Isilon Systems (and Madrona Strategic Director), and Parag Mallick who is a Stanford Professor with a focus on proteomics and systems biology with a background in biochemistry and computer science.

Nautilus’s Approach to Innovative Thinking

Biological sciences have been transformed over the past twenty years first by sequencing the full human genome and then by the “commoditization” of genomic sequencing (Illumina, 10X Genomics). Yet, a human’s approximately 3.2 billion nucleotides and 25,000 genes are just the beginning. The DNA functions as a set of instructions, a static view of what might happen, that needs to be transcribed and translated into the tens of thousands of proteins that drive all life — selective expression of proteins drive cell differentiation, metabolic reactions, stimulus response and, importantly, disease. Those proteins act dynamically to determine how our body functions (and malfunctions) which creates substantial measurement challenges.

From the beginning of Nautilus, Parag and Sujal set out to think differently. The core challenge they were trying to tackle: how do we make the proteome as accessible and impactful as possible by overcoming the limitations (coverage, throughput, ease-of-use) of existing protein analyses approaches. By reimagining proteomics as the foundation for improving the health of millions of people, Nautilus strives to enable new horizons in basic science research while transforming drug discovery and personalized/precision medicine.

Nautilus approaches the challenge of mapping the proteome differently at every stage of their automated and re-imagined process. That starts with the biochemical steps for how samples are prepared on the front end and continues through to the cloud computing, data science and machine learning techniques used continuously on massive datasets throughout the process. They leverage a robust understanding of biochemistry and the abundant technological resources that are only now available in scalable ways through cloud computing. There is so much more for the Nautilus team to share, but we defer to them on how and when to tell their story more fully!

Madrona’s Three Key Intersections of Innovation Concepts

Madrona’s investment in Nautilus and their approach to re-imagining the ability to leverage proteomics is just one area where biological sciences are intersecting with computer and data sciences. In the past several years we have increasingly seen the growing interdependence of these disciplines and the ability they have to change lives.

There are many more categories where the intersections of innovation apply. Digital pathology is developing models for image-based tumor detection, cancer research is applying machine learning to identify genetic or immune system biomarkers, and CRISPR screening techniques are helping to rapidly understand the mechanisms of action underpinning disease. Three key concepts span these intersection areas – discovery, automation and continuous learning.

  1. Discovery: The more we know about human (and non-human) biology, the more we realize there is so much more to learn. The pursuit of basic science research and the curiosity to explore new areas of discovery are central to the breakthroughs that lie ahead. Take the relatively new learnings about how bacteria’s immune system fights viruses by turning the virus’s DNA against itself through CRISPR-associated proteins (Cas) and guide RNA. In just the past decade, the natural function of the CRISPR-Cas systems has been harnessed intro powerful molecular biology tools to edit the genome, to the point that we can now edit at the base level. Modern information technologies will facilitate the front-end research and leverage discoveries, but the opportunities start with new biological insights.
  2. Automation: Biology was historically the world of wet labs filled with samples, test tubes and pipettes. Today, wet labs are combined with dry labs where computer modelling, simulations and in silico analysis occur. And, increasingly the processes of these two lab environments are automated and digitized. New approaches to sample prep and handling, to “seeing” and measuring the impact of reagents and then gathering massive amounts of data to rapidly analyze are emerging. The automation of preparing inputs, running experimental processes and analyzing outputs has the potential to mirror the journey of semiconductor technology from bespoke workflows to highly digitized, specialized and scalable processes. This automation, combined with massive computing resources, can lead to both broad scale breakthroughs and cost-effective precision medicines over time.
  3. Continuous Learning: Digitized data, across a mix of data types and formats, can increasingly be combined and normalized to transform information into insights. There are massive amounts of data to be captured through increasingly sophisticated techniques like high throughput sequencing and screening and cryo-electron microscopy. Elements of data management, modelling and machine/deep learning can then be leveraged to deepen the insights. In fact, operationalized data models can continuously improve our understanding of a mutation, antigen, biomarker or general disease state. In time, this should lead to curative approaches to most cancers, gene editing that prevents diseases and even rapid detection and containment of viruses.

The Road Ahead

The Madrona team is energized by our journey to continuously learn and support companies at the intersections of innovation. In addition to Nautilus, we have made substantial investments in Ovation.io, TwinStrand Biosciences, Accolade and Terray Therapeutics. And, we have seed-stage investments in a few early-stage companies within this investment theme. But today we especially want to celebrate the news about Nautilus’ Series B round and the potential for this outstanding team and company to positively impact the world by providing affordable and accessible proteomic information and insights to all those who may benefit from them.

POSTED IN: Madrona News

Madrona, Microsoft, Salesforce Invest In $40M Round For Online Professional Learning Startup GO1.com

POSTED IN: Portfolio Company News

Our Investment in GO1, Offering Online Training and Learning Content Platform Right When We Need It Most

We, at Madrona Venture Group, are excited to announce our investment in GO1, a company that is focused on making learning easy. GO1 has been quietly establishing their platform in a LMS (Learning Management System) agnostic way for corporations, educational institutions and continuing education organizations to reach their users with the content they need. When we first met with GO1’s Andrew Barnes, this current COVID-19 crisis was not even a whisper. Now at a roar, we are seeing that not only is GO1’s core business of corporate training strong, but the learning management systems that deliver content from top educational institutions to their students are expanding their usage. And we think they won’t turn back once we are out of this global pandemic.

GO1 delivers an onboarding, compliance, educational and professional development platform for employee and student education and training. By aggregating training content from a broad set of content providers, GO1 redefines how enterprises procure training content and how employees consume it in an on-demand basis via a modern self-service user experience. GO1 also integrates with a variety of key learning management platforms and integrates with front ends such as Microsoft Teams, which has seen incredible growth.

When I first met with Andrew Barnes, CEO and co-founder of GO1, I was a little skeptical about the training/learning market and opportunity. The worldwide training market is massive and estimated at low hundreds of billions of dollars worldwide. At the same time, it is a highly fragmented market. I was transparent with Andrew about my skepticism, and to his credit he took that as a challenge to educate me – and now we are investing. So, it worked!

GO1 is taking a unique approach to this massive opportunity. Rather than being yet another content creator, they have built a platform that aggregates any and all training content, provides an easy-to-consume user experience, and is LMS agnostic. Additionally, they have an easy API and can be integrated into corporate platforms and, as mentioned above, popular collaborative learning environments such as Microsoft Teams.

There are several changes underway in the market that together provide a massive opportunity for a platform like GO1 to fundamentally transform how people learn and train themselves to the ever- changing needs and requirements of the business world.

  • Secular trends are driving the need for more training including compliance and regulatory requirements.
  • Enterprises view access to world-class training and learning as a core value proposition for their employees – both in terms of increased productivity and satisfaction.
  • Consumerization forces drive employees to want access to training that is highly relevant and curated with an easy-to-consume on-demand experience.

GO1’s solution is squarely focused on taking advantage of these trends and delivering a scalable marketplace for corporate training and educational learning content. The access to data that they have about course consumption across users and industries provides a valuable opportunity to provide more curated and targeted content that is highly relevant for their users – driving consumption and satisfaction higher.

GO1 is part of the Madrona Acceleration Fund that we raised last year to invest in great companies and teams that have found product-market fit and are ready to scale to the next level. We are excited that Salesforce Ventures joined us as new investors in this round. With 1.5M+ learners already taking advantage of the GO1 platform, this company has laid a strong foundation for scale.

The world needs all kinds of support right now and we are excited for GO1 to be a company that can provide learning experiences to a broad audience, inspiring minds and inspiring change. We are looking forward to being a valuable partner for Andrew and his team as GO1 continues to build the world’s largest online learning platform.

POSTED IN: Madrona News

Capital Comes To The Door For Knock, Raising $12M In Series B Funding

POSTED IN: Portfolio Company News

Ready To Return To The Office? Seattle Employers Offer Advice In Madrona’s ‘Back to Work Toolkit’

POSTED IN: Portfolio Company News

Saving A City: How Seattle’s Corporate Giants Banded Together To Flatten The Curve

POSTED IN: Portfolio Company News

Programmable Fintech Payments Startup Sila Raises $7.7M Seed To Wipe Out ACH

POSTED IN: Portfolio Company News

Investing In The Future Of Fintech – Sila

Photo – Hope Cochran and Shamir Karkal, Founder and CEO of Sila

We are excited to announce our investment in Sila.  Sila is taking on the challenging world of fintech infrastructure and building a platform to allow fintech developers to launch and scale their companies. We were joined in the Seed Round by our co-lead, Oregon Venture Fund, as well as existing investors Mucker Capital, 99 Tartans, Jerry Neumann, and Taavet Hinrikus.

When we look around at the areas of the economy – especially at this very disruptive time – that have the potential to offer more opportunity to people from all walks of life, one of those key areas of innovation is the flow of money: the speed of transfer, the fees involved, and how it is stored.  This area of fintech has been growing, but not as quickly as SaaS and other B2B based businesses.  Why is that?  Regulatory approvals are challenging, the processes disaggregated and expense to get there is tremendous.

Building a new fintech startup is a difficult and often two-year endeavor. The existing regulatory frameworks make it difficult for new startups to quickly build, launch, and iterate products in the same way as other tech startups. The process is filled with regulatory hurdles that take years of time and deep expertise. The result is a company that cannot iterate and experiment on their new concept until the process of moving money can be solved – delaying proof of product/market fit much longer than in other areas.

Below is a non-exhaustive list of the steps required to build a fintech startup that handles money:

  • Compile know your customer (KYC) and anti-money laundering (AML) documentation
  • Create detailed fund-flow diagrams and specs
  • Find a sponsoring bank (often a white label bank such as Bancorp) to provide the banking backend and enter their compliance process
  • Find a processor for ACH/Wires/Cards
  • Apply for FINCEN (Financial Crimes Enforcement Network) registration
  • Apply for money transmitter licenses in all 50 states or where you plan to do business
  • Write custom code to connect your banking partner and ACH processor and your own product
  • Launch product as a beta

This process largely went unchanged from the late 90s to 2014 and was the process followed by the large original fintech players (Simple, Square, Stripe, etc.). On average, fintech companies take close to 2 years to work through this cycle before launching their product as a beta.

Our excitement in Sila began over a year ago after first meeting CEO Shamir Karkal and the rest of the initial team through Oregon Venture Fund – a long time partner and investor in the round.  We met up again at one of our annual Portland area dinners.  Shamir has spent his entire career in the fintech world: from co-founding and scaling Simple, the first neo-bank, and shepherding the company to a successful exit, to running the API and infrastructure platform for an international banking company, Shamir has developed deep expertise across the regulatory and infrastructure aspects of the industry.

Sila was founded with the core mission of fixing the problem of launching a fintech company or fintech features. Their main offering is a set of simple, secure, and compliant tools to help fintech developers launch their products and comply with financial regulations. The objective is to enable fintechs to get to market quickly and then be able to iterate on their offering, rather than working through ~2 years of regulatory and architectural challenges before being able to test their product. This is a problem that the Sila team knows in intimate detail.

Co-founders from left to right: Shamir Karkal, CEO, Alex Liption, CEO, Angela Angelovska, CLO, & Isaac Hines, COO

Via a simple API integration, developers can leverage Sila’s regulatory framework, send and receive funds, integrate with bank accounts, and seamlessly conduct KYC/AML checks, all while maintaining a single integration. We believe that Sila can significantly change the way fintech companies are built and can become the de facto platform in the space.

Sila represents everything we look for in our early stage investments: a dedicated and high caliber team led by an entrepreneur with deep industry expertise, a company committed to being built in the Northwest, a massive market opportunity, and true differentiated technology that solves a real problem. We are incredibly excited to start the journey with Sila and look forward to helping them build an amazing company that opens up massive opportunity across the fintech world.

POSTED IN: Madrona News

OctoML Raises $15M to Make Optimizing ML Models Easier

POSTED IN: Portfolio Company News

Ask The Expert: Tim Porter, Managing Director, Madrona Venture Group

POSTED IN: Portfolio Company News

Seattle Tech, Business, Sports Heavyweights Raise $27M for COVID-19 Community Support Fund, Call on Others to Join

POSTED IN: Portfolio Company News

Washington State Authorizes Mobile Fueling; Legislator Calls it ‘Timely’ as Residents Practice Social Distancing

POSTED IN: Portfolio Company News

Founded and Funded: Building an Open Source Business from Scratch with Eric Rudder and Joe Duffy of Pulumi

This week we are publishing a non-covid related podcast – recorded before Seattle was hit hard. We hope it provides some relief! We are also prepping some great podcasts that deal directly with how founders and people are managing through this time – and looking to the future. Stay tuned for those!

A few quarantine essentials: Non-perishable food items, toilet paper and the Founded and Funded podcast. Founded and Funded is back with Episode 5 of Season 2. In this Episode, Madrona managing director, S. Somasegar sits down with the founders of Pulumi, Eric Rudder and Joe Duffy.

During their time at Microsoft, Eric and Joe found the most joy in building something from nothing in the form of one-off products. Along their journeys, they paid very close attention industry inflection points which helped time the perfect jump. However, before they could take a bet on their idea, they had to take a bet on each other as co-founders.

Listen in on their conversation as they chat about the time they spent together working at Microsoft, the promise of open source technology, and their experience building a company that empowers both its employees and its customers. Looking for insight on how to time your leap into entrepreneurship? We have that too!

Full Transcript

Erika

Welcome to founded and funded. This is Erika Shaffer from Madrona Venture Group. Today we’re going to hear from Eric Rudder, and Joe Duffy, who are the founders of Pulumi. Pulumi helps developers create, deploy and manage modern cloud infrastructure. They speak with Soma, about their time at Microsoft, where they all worked together and knew each other and how they are applying what they learned there to startup life. This was recorded before the onset of the Covid-19 crisis. So it has a little bit of a light hearted tone. I hope you enjoy it. Listen on.

Soma

It’s really an exciting opportunity to get a chat with a couple of people that I’ve known for many, many years and I’ve had a chance to have the opportunity in the past. Religion to work together over the years. I’m Soma Somasegar, a managing director here at Madrona Venture Group. And let me have Eric and Joe introduce themselves.

Joe

My name is Joe Duffy, I’m founder and CEO of Pulumi. Me prior to this, I, you know, I was at Microsoft, where I got the privilege of working with so Maya and Eric, for many years, really fired up about developers making developers productive and really excited about what’s going on in the cloud. And that’s kind of why we started Pulumi. And I’m excited to be here and kind of tell tell the story of the journey.

Eric

And I’m Eric Rudder, founder and chairman of Pulumi. I’m equally excited. I think at Microsoft we used to say super excited. So I’m super excited to be here. And I think we’ll have some fun today.

Soma

Great. You guys have had a very successful career at Microsoft. You were there for sort of many, many years, couple of decades. And Joe, you’ve been there for 12-13 years of Microsoft very accomplished, very successful. What made you guys decide to say like, Hey, I’m going to sort of give up all that goodness and safety and get in get to be an entrepreneur and start the entrepreneurial journey with Pulumi

Joe

That story like, for me, I actually started my career. Actually, when I was in high school, I kind of started a little consulting business where I was helping companies get to the internet. And that gave me exposure to kind of some of the sales and marketing and customer relationship parts of a business, you really need to think about making a profit and making customers happy. And so I actually looked at starting a company before coming to Microsoft, and then the opportunity to come to Microsoft arose and I knew, hey, I’m gonna get to work with the best people in the industry. I’m gonna learn so much. I figured I’d say for three years and then go start a company. And every year I asked Is this the year and turns out 12 years passed quicker than I could realize seeing things at scale, seeing innovation at a company like Microsoft is just completely leagues beyond what you see typically, you know, in most companies, and frankly, I would have met some I would have met Eric if I if I didn’t do that. So, really, to me, I just wanted to get connected to the customer. You know, I felt like a big company is great. There’s lots of funding to do really innovative, new bold bets. But really the appeal for me of a business is it’s a meritocracy of business. The idea succeeds because people pay money because it, it delivers value to them. And so that that economics aspect to me was always fascinating. That’s been the biggest learning curve after leaving Microsoft as well as you know, hey, you’re thrown into business and customers and sales and marketing and finance. And that’s been, for me the best part of the journey so far.

Eric

I think my journey is probably similar to Joe in high school, I was actually a manager in a hardware store, Max matching swatches of sofa fabric to custom paint colors, and getting people the right size of lumber. So I guess you’d say both of us have helped people build things from a very early age, but I want to but at Microsoft, kind of on a lark, and as a great career, I got to do lots of different things there. I got to, you know, work on developer tools. I got to work on research, I got to run, you know, Business Development at the company. And it was a great experience great people always, at its core, Microsoft’s been a developer Led company in terms of its culture and audience and products, and kind of went through the typical, you know, kids out of the house empty nest thing you always look at, you know what I want to do with, you know, my next 20 years of career and it’s always a challenge to build something from nothing and get Microsoft, you know that I had the most fun and the most joy, literally building one Oh, products versus taking a product from 7o to 8o. Not that they’re, you know, aren’t the features that I’d like to add to PowerPoint for their next version. But it’s always more excited to establish a product or establish a category, you know, the opportunity was just too great. We kind of started the company. At a time when every application was becoming a cloud application, it was clear that a lot of the tooling was geared towards, you know, sort of the previous generation of products and we’re just starting to get towards, you know, modern container infrastructure, modern computing infrastructure, you know, multi cloud, you know, many cloud connecting data sources, and it was just clear we were at the right inflection point to go do something. I’m old enough I’ve watched the inflection points, but I’ve seen the inflection points from character to graphical. I saw the inflection point from client base to client server. I saw the inflection from client server to internet. You know, once the industry was closed on cloud native, I was like, Okay, this time, I’m going to lead from a different perspective rather than Microsoft and Joe and I just started hacking away in his basement, literally, as we call the winery, since Joe’s hobbies is making wine. So it’s a big wine barrel down there. And we just started working together and it’s been a great ride ever since.

Soma

You know, one of the things that entrepreneurs always say is like, Hey, there are a lot of critical positions that they ever make day in and day out. But one core fundamental decision that they have to make earlier on is who their co-founders are going to be. As much as you guys have had the opportunity to work together and get to know each other over the years. How did that decision or ordering the journey come along? Where you decided to take a bet on each other and say, like, Hey, we are going to together co-founder below me?

Joe

I think I you know, I worked with Eric throughout the years at several points. You know, I look back and a lot of my fondest memories Working at Microsoft Word these sort of 1o projects where we work together to build something from nothing. So I had seen that happen before I actually had that experience. And honestly, we did hang out in my basement for starting the company and see, Hey, can we can we build the thing? Can we figure this out? Can we figure out kind of how one plus one equals three? And I think that period really gave us the confidence. Not only was it the right partnership, but also the right opportunity at the right time. So actually, you know, just deciding, hey, we’re going to do this. And frankly, we’re both sort of ready to do it at the same time. That doesn’t happen very often. Right? It was almost like stars aligning that we were both ready to leave Microsoft, which frankly, is kind of a scary thing. You know, you’ve got an established career. You’ve got a network, you’ve got that financial safety, but both of us were at the point in our lives where we’re ready to say to take that leap.

Eric

Yeah, I think you know, for Microsoft, we just literally decided let’s work together and see how it goes. Let’s build something. We built little things that looked at Twitter streams and lit up light bulbs. Joe remembers that.

Joe

I do! During the Superbowl one year detecting who was talking about Beyoncé versus the actual game? Yeah.

Eric

We looked at, you know, doing some infrastructure products together, we looked at doing some Mar tech stack together. And I think Later, we’ll probably talk about how we got to the idea for Pulumi. But it wasn’t that the Pulumi idea was the first thing we just thought I was hated. We enjoy working with each other, and we would, you know, kind of start working in the morning, we literally would, you know, take a break for lunch and cook lunch together. Well, Joe and I are kind of into cooking, and I won’t claim them quite the shift Joe is, but it is a way to see you know, do we enjoy social time together because startup life is sometimes intense and sometimes many hours during the day. And so, you know, we enjoyed spending time with each other and were able to build the solutions we set out to build I think that’s the most important thing is you know, because it’s easy to just ideate and kick stuff around. But we were actually able to build stuff, get stuff done, you know, sort of encourage each other trust each other. And that was hopeful and we were able to take the leap.

Soma

How would you describe what Pulumi is?

Eric

Yeah, I think I’ve said before that all applications are cloud applications. And Pulumi really enables developers, DevOps, DevSecOps, to build better cloud applications faster. You know, when we got started, as I said, we were literally incubating something different. We were kind of working on a Mar tech solution. And we got to the point where we were like, okay, let’s kind of stand this up in the cloud. And let’s see what the state of the art is for provisioning something, giving our customers the power to run it on the cloud that they wanted or on prem. And we found that there wasn’t any tooling to do this. And so you know, the oft quoted Necessity is the mother of invention, really was the thing that got us going to fulfill the need, there was absolutely a need to probably about 30 companies before we actually founded Pulumi or wrote our first line of Pulumi code and there really wasn’t need Pulumi helps people provision, deploy, run, secure their infrastructure, we call it modern infrastructure, as code you Making sure that Devon DevOps can work together. It’s based on the idea of using real programming languages. So people don’t need to learn new specific dsls. They get to use their favorite editors, their favorite tools, their favorite integrations, their favorite package managers, their favorite versioning semantics. And we’re extending it to letting people write rules about policy, security, all these things that people kind of struggle with today, in terms of keeping up you know, Pulumi makes that easy for dev teams,

Joe

Honestly, our backgrounds caused us to take a pretty radically different approach to the space, I think all those years, really obsessing over developer productivity and making developers happy and bringing them joy and making them you know, giving them superpowers, right, that that that was our day job that got us up out of bed every morning, you know, for decades. We brought that same attention to detail that that kind of human care factor of Hey, we want, we want this to be not only productive, safe, secure, we actually want to bring joy to the idea of building cloud software. And so that that idea of really integrating the cloud development experience to the inner development loop is pretty novel. And you know, Pulumi is really, in, you know, a completely different approach than anybody else in the market today. It is open source as well. And that’s really important to us, we see a community and a community is really core to everything that we do with Columbia as well.

Soma

He just reference open source, Joe, you can’t like, you know, think about developers without thinking about open source today. And most companies that sort of do something or other with open source, A, then they start off with like my head, I’m going to observe an open source project, and the project becomes successful Can I think when I let me think about building a company around that, or the other way, which is like, no, hey, I’m building a company, I’m building a product, I’m building a service. And then sometime down the road, I decide that I want to take a piece of what I’m doing and make it open source for all the right reasons, but you guys decided earlier on almost from day one, to take a different approach. You said like a hair. We want to build a commercial entity here. And by the way, because we are focused on building something of huge value to developers, we want to think about our open source strategy. And let’s keep both in mind from day one. How did you guys come to that decision? And how was that journey for you?

Joe

Yeah, we knew from day one, it was really important that, you know, the core of the platform we’re building needs to be open source for a number of reasons. One, it encouraged contributions. It encourages, you know, people just want to understand how it works. It gives people confidence that we’re some part of the company to change, they still got the project, they know the project, they’ve got the source code for the project. It’s table stakes, right? For developers, that core technology they’re using, especially to author your own software needs to be open source. So we knew that going in. The question was, we didn’t want to end up in a situation we see other folks struggling with where they open sourced the business model. They didn’t think of how we’re going to make money. They really focused on community and nothing else, assuming that eventually they’d figure out the monetization strategy. And we see time and time again, it’s not easy. A lot of these companies don’t figure it out. And so we waited longer than we Had to open source until we had figured that out. And it’s interesting. There’s an interest in our Horowitz article that talks about the three waves of open source monetization strategy from taking into selling support as kind of wave one, wave two is really the open core model and wave three, it says, and this came out just a few months ago, but you know, we knew SAS was going to be big, and there was a natural alignment besides the open source technology. So what we did is actually said, Hey, we’re gonna open source, the whole platform, it’s all going to be there. We’re not holding anything back. The thing that we’ll charge for is the SAS. And this is, you know, an increasingly popular approach. It definitely comes with some challenges, but the benefit is from day one. We knew how the business would unfold. We knew how the community interacted with those revenue opportunities.

Soma

Now that it’s been what, two and a half years since we made that decision, are you still feeling great about the decision? Any learnings that you want to share the process?

Eric

Yeah, I think we I think we feel better about the decision every day. I think the other thing Just to build on Joe’s answer, like, we’re also living the lifestyle, right. So as we were bootstrapping our company, we’re benefitting tremendously from open source, right. So we’re a multi platform multi language company. And quite frankly, we could not have done it without leveraging open source contributions of many. So, you know, we often talk about, you know, standing on the shoulders of giants, and we definitely benefited from keep the people who came before us. And it just seemed like the right thing to do, right is to, you know, to contribute back fixes rather than fork and, you know, give credit where credit is due. And that was the great thing for us. The other thing we wanted to do was make sure that we added value as a company immediately to people who were using the open source and so we decided to provision a service and more probably a free service. So even if you’re just using illuminate casually from the open source distro, you could connect it to the Pulumi service for free and continue to give back to the community and to kind of nurture them along and for To discover, you know, what was unique about the commercial part of polygamy is no question. It’s a it’s a tough boundary between deciding what’s in the, you know, the free version and what’s in the premium version. And we’re absolutely tried to build a business and the maturity thing, but we made a fundamental decision that know the core value proposition of Pulumi is going to be open source, we were going to continue to support the community, encourage community contributions and be good members of the open source community in the large and that’s been a great founding decision. Honestly.

Joe

I’d say the one other just lesson learned to add was, I think it is really important to be clear upfront with your community, that here’s what we’re doing, and here’s why we’re doing it. And you know, I remember the day we launched the commercial edition of ourselves and in the community Slack, we had heart emojis and you know, celebration emojis and like the community actually is rooting for you provided you are open and honest about what you’re trying to do and why you’re doing it and the community wants you to have a system business because they enjoy the open source project you’re building. And they want that to be funded for many, many years to come. And so you’ll actually find if you’re open about where that boundary is and why people are super supportive,

Soma

Joe, you enter sort of one of the earlier problems of open source of Microsoft. And one of the big decisions that we made many years ago, Microsoft rose to open source dotnet framework. Tell me a little bit about that.

Joe

You know, I was in the windows organization and one of the goals was to modernize the engineering systems and try to work a little bit more like open source technologies, being able to use components in the open source, one of the challenges of proprietary sources, you’re always reinventing the wheel, you’re always creating solutions to problems that people have already solved and, and so we’re looking at ways to embrace that inside internally and actually share across the company as well have this notion of we used to call it internal open source which was unlock collaboration across all of Microsoft. So no matter where you are, you can contribute whether it’s a bug fix or feature recommendation or whether you’re just trying to apply you know, security standards across Company try to unlock that. So I had that coming into Dev. And someone asked me to start this project. And to be honest, I was flabbergasted that we were going to do that and super excited to start. And the thing that was amazing was more of a cultural transformation within the company than it was even a technology one, I remember, my team’s PC renewal was coming up. So people had to get new laptops, and I kind of said, Hey, 50% of the people in the team are gonna get Mac books, they have to give up their windows laptops. And I can’t tell you the number of people that came to me said, Wow, did you know almost everything we work on? If you have a Mac Book? is it relevant to you? And that most people doing development these days use Mac books. That means most of what we’re working on doesn’t apply to most developers. And so it was just like, really rejuvenated the team. There’s a Renaissance and, and I see now just years later, the impact that had on the entire culture across all of Microsoft was just super transformative. So is the human part actually, it turned out to be the best part of that, that whole journey.

Soma

It’s been what not to go into fields also since we started Pulumi Every day is a sort of a new day as an entrepreneur, what are some of the key learnings that you guys have had as part of the Pulumi journey in the last couple of years that you think other entrepreneurs would love to hear from your experiences?

Joe

So one for me is change is the one constant, my job changes month over month, you know, we’re a little bit further along now. So it’s, I would say things have settled a little bit, the roles and responsibilities settle a little bit as you as you hire people into functions. But in the early days, you’re doing a little bit of finance, a little bit of product, a little bit of coding, and frankly, I was coding very well into the journey, even when we had customers and doing marketing. And, I mean, you have to wear a lot of hats. And you have to be comfortable with the idea that how you spend your time next month is going to be very different than how you spend time this month.

Eric

For me it was probably I was fortunate to meet Colin Powell, one of his favorite sayings is a positive attitude is a force multiplier. When you talk about good days and bad days or you know some things go your way and some things don’t. It’s tough when things don’t, right. You’re young company. No one’s ever heard of you. You know, it’s  hard to open a bank account, it’s hard to raise capital, it’s hard to get an internet connection at the right speed, it’s hard to find a real estate place to work at a reasonable rate. It’s hard to hire versus big companies yet, you know, that core belief in that, you know, hey, there really is a market need for what we’re doing. We believe in it. We believe in the product, we believe in the community. You know, we believe in the opportunity, that enthusiasm is infectious. There’s times you just need to suspend disbelief, and go forward and take that leap. You know, and I get to, you know, lots of credit for, you know, having that blind faith and, and, you know, leading us forward, I think that’s the thing that you can never underestimate in terms of just staying positive. And just reflecting on these, you know, one or two things may not have gone well, but look at all that we have accomplished. Both Joe and I by personality are not the greatest in the world at stopping and celebrating what we’ve accomplished in the week. I think both of us are much more likely in our status reports to write the low light section before we write the highlight section and yet don’t minimize what you accomplish in terms of getting good You’re just this decision to take the leap to lead the company to start your own thing to build the first version, you know, the, all these famous quotes about, oh, you should be ashamed of your first version or you know, they’re all true. And yet just having the belief overall, we’re going to do it, we’re going to succeed, people build off that people feed off that your customers feed off that your partner’s feed off that your employees feed off that it’s a super important thing to do. And I take away that learning I think I’ve internalized by doing a startup.

Joe

But we were talking about one plus one equals three kind of thing. I mean, that is something that Eric does have to remind me about. And so I’m super happy he does because it’s really important. You know, you have these people that believe in the vision, they believe in the company and things aren’t always rosy. But you have to figure out a way to celebrate those successes, no matter how small to keep people kind of pointing in the right direction and feeling inspired feeling like yeah, last week, we had a few setbacks, but you know what, we’re gonna, we’re going to do this thing and I still believe and that it’s tough as a founder because you’re, you’re definitely shouldering a lot of these burdens. Like the final financing you want to share, because employees want to know kind of, if things aren’t going well, you don’t want to hide that from people, but you have to frame it in an appropriate way. And that’s definitely a challenge. But it’s very important.

Soma

If I’m looking at it from the lens of you know, hey, I would love to learn from any mistakes that Joe and Eric have made other things that you wish you had done differently.

Joe

Yeah, so one that stands out is a mistake that I frequently make that Eric frequently corrects me. Which is, there’s this notion, especially if you’re building a venture backed business, that you need to be a quote, hyperscale company, right? You have to, it has to be up into the right all the time, you can never fall short of 10xing the growth or, you know, crazy, crazy growth metrics. And it’s really easy to get caught up and looking at survivorship bias of, well, this this great company over here, lift to you know, grew, you know, 10X year over year for the first three years, you know, so if we don’t do that we’re a failure. I think the real key thing is to be intentional and focus on what matters. There’s a lot of value Any metrics that people kind of get caught up in and really having that slow, steady growth and being responsible about how you’re funding that growth, so that you actually do measure return on investment. Like, if you’re not 10xing your growth, it’s easy to think that money will solve the problem, right? hire more people do more PR do more expensive events. And the reality is until you have that solid foundation, trying to scale too quickly, just it’s not gonna work. And it’s a quick way to run out of money, frankly.

Eric

Get annoyed, I’d say the so we talked about like Joe and I working together in his basement for awhile we probably worked on and off in your basement and my dining room table for what for about six months, I’d say we should have worked together for about two months. We talked about you know, taking the leap and how tough it is to take the leap. The opportunities out there are tremendous Do it Do I wish we got started four months earlier only when I think about it, which is only every day, you know, because you look at these growth modes and they’re  all compounding right. And so if we had, you know, an extra four months in our pocket, you think about all the employees you could have hired, you know, A lot of these things are timing based and you know, the opportunities. We missed a few people, they decided to either re up their current companies or go to other startups or start their own companies. I think we knew early on that the opportunity was big, even if we weren’t sure exactly how we were going to pursue it. Like we knew early on that we were able to work together, in part because we had a shared work history. I think we were lucky, we had friends from the outside sort of encouraging us to take the leap.

Soma

You know, as entrepreneurs, when you think about success of the company, in this case, success blew me. There’s all these sort of what I call financial and customer metrics that you can talk about. But for you guys, personally, how would you define success for you, Joe, for you, Eric?

Joe

when we started the company, we knew we wanted to build a business, right? We want to build a great company, we want to build a business that, you know, could become profitable. The point of businesses, you know, you fund the business eventually actually makes money. Right. And I think that, to me is the outcome that we’re seeking is we want to build a sustainable long term business. You know, we could have, especially a lot of tech companies can build the company and with the intent of selling it or having a quick exit, or you can optimize for different things. And for me, that’s the most satisfying outcome is happy customers happy end users sustainable business, because then, you know, we can branch out into other adjacencies that are in this fast growing phase, you know, cloud is here to stay this, this transition that’s changing, the whole industry is just getting started. I really want us to have a business that can be here now solve some problems, but solve those problems in five years and 10 years that are going to just be even bigger than they are today.

Eric

Yeah, I mean, it’s kind of a big question, right. Even before we get started, we’re actually talking about Clay Christensen just passing away and he’s actually got a great essay in Harvard Business Review on sort of how do you define success, who some of them are business metrics, some of them are personal metrics, you know, being a great family member. And then his last one is how do I stay out of jail which is really you know, an ethical consideration. I think in the on the business side, we wanted to build Something of enduring value that really made a contribution right to the industry in terms of helping people write cloud applications, when you look at, you know, still the opportunity out there for the cloud applications that are going to be deployed that are going to change our life and fundamental ways we can be a small part of that. That’s a tremendous contribution. You know, we wanted to create a company with a culture that people enjoyed working out, people felt that their work was rewarded. People felt that they were respected that one of the benefits of starting your own company is you get to start and create your own culture. And I think that’s a that was a tremendous opportunity. Get to pick the people that you hire, what rules you employ. I think we firmly believe in the no assholes rule. You know, these are people that you’re gonna be spending lots of time with on a regular basis. I think we’re off to a great start with Pulumi. We’ve got a great core of folks, we’ve got a great core of community, a great set of customers a great set of values. And you know, the opportunity before us is tremendous. I think that’s the personal front. That’s one set of stuff I can assure you will stay out of jail. And then the other business side, it really is, you know, creating a great company that creates great products and fosters a great environment for employees.

Soma

If you think about like the next, say, three years, or five years or even 10 years, what aspirations do is follow me.

Joe

I mean, for me, I think of every developer on the planet, being empowered to use the best of what the cloud has to offer to build more innovative software and for their company for, for whatever they’re  doing, but really just supercharging their ability to innovate using all these great cloud capabilities that today, frankly, are off limits for many of them. So to me three years, five years, however long it takes to get to that level of scale. You know, every developer when they think I’m building an application, they think, Hey, Pulumi is the way to do that, because it’s the best way to build this application and achieve the intended outcome. And I think honestly, as more people become developers, you’ll see more hobbyists becoming developers, frankly, folks that are growing up now. You know, a lot more of them are learning how to program very early. And so they’re gonna be a lot more developers, the developer segment is continuing to grow. folks that don’t consider themselves developers today will uplevel their skills and learn how to write code and become developers. And so really sort of tapping into that, I think is the opportunity for us.

Eric

Yeah, I think when I walk into one of our customers shops, I want to see every cloud engineer in that environment with Pulumi open and running on their desktop, helping them get their job done faster, helping them build better applications, really helping our customers be more productive.

Soma

You had the choice to design, the company Pulumi wherever you want, and you chose to build it in Seattle. How do you see Seattle as an emerging as a technology as a, you know, innovation as a startup ecosystem? Both over the years and more important in the future?

Eric

Yeah, I mean, I think we chose Seattle mostly for the weather.

Eric

I think we’re on day 45 now of straight rain.

Joe

Great for productivity by the way, you don’t, you don’t have the sun distracting you calling you outside.

Eric

You know, the thing about Pulumi is I think we recognize the opportunity very early on for cloud applications in particular, you know, we sort of touch on cloud infrastructure in many ways. And Seattle is a is an incredible community of cloud talent. I mean, obviously, all the big three cloud giants have strong, you know, representations here, in addition to the other tech companies, you know, sales are a great place to live. It’s a great quality of life. I think that’s what brought us here in the first place. The community is, you know, continuing to grow in its maturity, like, you know, it’s the, you know, it’s one of these things in the industry, where you sort of overestimate what will happen in one year, and underestimate what will happen in three years or five years. When you look back on the tech community 510 years ago, you might argue is a little bit sleepy, it’s vibrant. Now, you know, we’re literally taping this in a tech incubator. There’s bunches of interesting companies that we meet every day, whether it meetups or you know in our own headquarters coaching on how to use Pulumi the talent pool is great, the people is great, the culture is great. And at the same time, I think it was important when we started Pulumi me to embrace sort of the modern work style. And so we do have employees that work remotely. So even though our headquarters is here, we’re very much a modern internet style company, you know, employees in California, Utah and New York, we’ve employees now abroad, and Amsterdam London bath. And so part of it is embracing the worldwide culture, even though Seattle is kind of our home and hub. And I think we’ve really managed to get the best of the local community and the worldwide community and kind of fusing those things together. But we love being in Seattle, we love the talent and people in Seattle at the university anchor is fantastic. The big company tech anchors is fantastic. It’s kind of a built-in captive audience for us it for customers that are easy to see, and for building the community of plumbing users as well.

Soma

I really enjoyed this conversation. Thank you both for sharing your thoughts and experiences in this podcast. See you again.

Joe

Thanks Soma.

Eric

Thanks a lot.

Erika

Thanks for listening to founded and funded. If you liked this episode, please subscribe. We’ll have some interesting episodes coming up with CEOs and experts talking about managing through this downturn and difficult adjustment period for many companies and businesses and employees. Stay tuned for those

POSTED IN: Madrona News

Seattle Businesses, Government Leaders Set Aside Differences To team Up On Coronavirus Response

POSTED IN: Portfolio Company News

These Are The Most Innovative Security Companies of 2020

POSTED IN: Portfolio Company News

Inside Rover’s Pet Friendly Seattle HQ: People And Dogs Stretch Out As Company Aims For More Growth

POSTED IN: Portfolio Company News

Our Investment In Esper To Enable The Dev-Ops Of Smart Devices

Today, Madrona Venture Group announced that we’ve led the $7.6M Series A investment in Esper, an investment that Tim Porter and I spearheaded for the firm. Esper is a devops platform for Android IOT devices.

As everything around us becomes smart and connected, developers of devices have many new challenges. We are no longer just designing a single piece of hardware – but developing a full solution spanning many cooperating devices and supporting cloud software. During development, we have a variety of deployment, testing, and versioning requirements. Once deployed, we need to support device maintenance and updates on both hardware and software through a variety of complex deployment variations, while also supporting that rare remote debugging session. We have regular security updates to the firmware, OS, and apps to manage. We need to integrate device signals with CRM systems, billing systems, and more. Like we’ve come to think about a “dev-ops” process for cloud services, we now need to think about a dev-ops process for our smart devices.

For non-phone devices which require a user experience, Android has become the most popular platform due to the free price, broad silicon support, and broad software framework support. Amazon Echos, Peloton Bikes, and many home televisions all run a version of Android. When it comes to managing these devices, there are many options available for corporate IT to manage personal Android phones — but there’s no great solution for devices where a developer needs to manage these endpoints into the dev-ops process of their overall solution.

This is the challenge which the co-founders of Esper lived through as they worked in their prior roles. Yadhu Gopalan, CEO of Esper, most recently led the development and deployment of all the smart devices in the Amazon Go retail stores. Shiv Sundar, COO of Esper, most recently helped lead the Cyanogen Android device ecosystem. Prior to those roles, I worked with Yadhu and Shiv on the development of the Windows embedded operating system. It’s fun to be working with these great engineers once again!

After introducing their solution late last year, Esper quickly started serving many impressive customers across over 50,000 devices. Each customer we talked with discussed how they had tried to use a mobile device management solution designed for personal devices, but it had failed to meet their dev-ops needs.  We’re excited to work with the Esper team to scale their solution, delighting developers all over the world as they enable billions of smart devices to do amazing things.

It’s been great to partner with Tim Porter on this investment. His experience with other developer focused investments like Heptio will be invaluable in Esper reaching its full potential.

This blog post was also posted on Terry’s LinkedIn page.

POSTED IN: Madrona News