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Startup CEOs Sound on Choosing Cloud Providers • londonbusinessblog.com

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Years ago, there was a price war between public clouds. In 2014, to cite just one example, Amazon’s AWS lowered its prices in response to Google’s recently launched competing service.

Since those heady days, the cloud infrastructure market has matured and changed. Sure, AWS is still a top dog, with Microsoft and Google working to share both the leader (and each other). But the era of seemingly endless price cuts has been overtaken by another market narrative: While building on public cloud services is cheap to start with, it can become much less so over time.

The fact that Dropbox has made the choice to build its own infrastructure remains an interesting, albeit isolated, data point. (londonbusinessblog.com’s coverage of the 2017 event is worth your time.) We wanted to get a better feel for what founders and CEOs think about their public cloud choices, and their strengths and weaknesses.

So we got our hands on a few companies that we’re tracking, gathering input from BuildBuddy (early stage, YC-supported, delivering a managed service), Monte Carlo (mid-stage, high-growth, data-centric), and Egnyte (late stage, profitable, a near-IPO company with a focus on cloud storage and productivity) to get the broad picture.

We polled the three founders and included their full answers below. But first, a few notes on their answers.

Don’t build alone

The number of companies that have built on a public cloud and later went solo is small. Despite Dropbox managing the transition and later finding gross margin leverage, most companies building on public clouds remain there.

And that seems to remain so. The two younger companies we surveyed mentioned the scale needed to make such a transition economical. Egnyte’s CEO, the leader of a company with a history of cloud storage – which means it certainly has the required scale, right? — mentioned some more modest cases where it can use its own hardware instead of public cloud services. But if Egnyte is still happy with the use of public cloud infrastructure, we can assume that almost every startup will stay put as well.

Mostly (cloud) monogamous

Both BuildingBuddy (GCP) and Monte Carlo (AWS) are single cloud companies. Egnyte has some workloads on clouds that aren’t the most important, but noted that it is somewhat concentrated. As before, we see similar answers from each company, size on the side. This is why AWS et al. work with boot accelerators; if you get a company on board your public cloud at a young age, you have (almost) a customer for life.

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