Evolution of the Cloud

af appfog EVOLUTION OF THE CLOUD Towards a NoOps World The Cloud is technology built upon technology in a feedback loop to reduce the cost of running and starting companies. More start-ups received seed funding in the years since 2010 than at any other point in history. People have, rightly, identified the decreased barrier to entry as a major driver for this change, and the employment market in the US as a secondary driver. What has been largely left out, however, is the role that core Cloud technologies have played in this shift. To understand what this means, we will walk you through a little bit of the history of the Cloud - from a perspective of how the changes have impacted start-ups. 1990s: The rise of the datacenter Costs decrease Productivity increases In-house Sources: Notional venture Capital Associotion and Center for Venture Research Datacenter In-house Sources: Notionol lenture Copital Association and Center for Venture Reseorch Datacenter In the 90s, datacenters rapidly the decreased risk profile that was created. Many of the largest dot-com wins were created from this dynamic. This is not, however, to say that these start-ups were easy or cheap to get appeared, providing hosting and connectivity related services. The shift to managed datacenters created 1990's EEFFREFER exponential savings in both cost and time for internet technology based start-ups. going or to run. Datacenters This directly resulted in the start of a boom in early stage investing due to It was simply an exponential decrease is the cost and time, resulting in decrease needs for capital. Next: 21st century virtualization and Amazon Web Services As we entered the 21st century, the introduction of virtualization created another round of exponential cost and risk reduction. By de-coupling physical hardware from the resources it represents, start-ups were able to not only decrease upfront costs, but were able to scale in a more agile manner. Where virtualization suddenly became a huge game changer, however, was when we saw the development of APIS built on top of this virtualization layer. Costs exponentially decrease Productivity exponentially increases In-house Datacenter AWS Sourcos iational Ventro Capital Association and Conter for Vonture Research In-house Datacenter AWS AWS Sources Notional kenturo Contor for Vonture Roseorch Capital Associationa With the introduction of Amazon Web Services, developers suddenly to see the ability to more completely abstract the IT/resources aspects of 2006 |VMware, XenSource and in particular, for the Start-up largest drivers for the more recent boom in the internet tech API's creating software. Boom. The exponential savings in time and cost over working directly with As compared to even the risk profile of doing a start-up in the 90s using managed datacenters, doing a start-up was suddenly dramatically less difficult and scary. Virtualization virtualized resources that resulted from the introduction of APIS to 1990's virtualized resources is one of the Datacenters 2011: Systematizing SysOps management Entering 2011, start-ups saw another round in exponential savings creating technologies as products like Chef and Puppet increased their marketshare. By adding a layer on top of APIS that handled SysOps in a more systematized manner, the cost of managing software built in the cloud was again exponentially decreased. DEVELOPER'S TIME Software Development SysOps 40% 60% Puppet, Chef Middleware Mgmt 2011 Network Mgmt Virtualized Hardware Mgmt Provisioning Security SysOps 2006 API's 1990's Virtualization DatacentersS Costs exponentially decrease Productivity exponentially increases In-house Datacenter SysOps Sources: Notional Venture Capital Association and Center for Venture itesearch AWS In-house Datacenter AWS Sysops Sources: National Venture Capital Assoclotion and Center for Venture Research In addition, these technologies gave developers the opportunity to shift their this full cloud stack) for less money, and in less time, than it would have taken to time away from doing IT work and towards writing code (what they are supposed to do). This dramatically increased velocity and efficiency – further reducing risk and cost. simply launch the website for such a company in 1997. Hacker News started to promote more and more stories of folks creating a start-up from inception to launch in a month. At this time the industry had, as a result, reached the point where it was realistic to form a start-up and launch an internet tech based product (using Then, in a week. 2012: Velocity These exponential savings, however, are not done yet. As we enter into 2012, the cutting edge of Cloud tech lies in App Lifecycle Management. And once again, the savings derived for a start-up are exponential in nature. By moving the human costs of setting up and managing Apps on the SysOps layer, velocity is increased exponentially as well – and on-going costs decreased be a commensurate amount. Cloud Foundry, OpenShift CLOUD 1.0 "laas" App Lifecycle 2011 SysOps (Resources) 2006 API's 1990's Virtualization Costs exponentially decrease Datacenters Productivity exponentially increases In-house Datacenter AWS SysOps App Lifecycle In-house Datacenter AWS SysOps App Lifecycle Sources: National Venture Capitol Association and Center for Venture Research Sources: National enture Copitai Association and Center for Venture Reseorch App Lifecycle is responsible for automated deploys, starting, stopping and monitoring applications. It is the first foundational Cloud technology that cares more about a holistic app approach than managing resources. The major shortcomings for App Lifecycle are that although automated, they do require maintenance and IT to run and do not create a full platform from which you can connect all the services you need across datacenters and providers. 2013: A bright NoOps future So where does this all lead? The end-game is NoOps. Where building and running an app is purely a developer process – and where developers are not having to spend time doing Ops work. DEVELOPER'S TIME Virtualized Hardware Mgmt CLOUD 2.0 Network Mgmt "Paas" (Apps) Provisioning Load Balancing Security Software AppFog, Heroku Development NoOps 5% 95% Middleware Mgmt Services Mgmt Failover Mgmt Log Management Audit Management 2013 NoOps CLOUD 1.0 "laas" App Lifecycle 2011 SysOps (Resources) 2006 API's Virtualization 1990's Costs exponentially decrease Datacenters Productivity exponentially increases In-house Datacenter AWS SysOps App Lifecycle NoOps In-house Datacenter AWS Sysops App Lifecycle NoOps Sources: Notional Vennire Capitai Associotion and Center for Venture Research Sources: Notional Venture Copital Association and Center for Ventire Research NoOps is the future. But it's a very near future. NoOps, typified by managed passing them along to developers as one, rolled-up, massive reduction in cost, time and risk. Platform-as-a-Service offerings, is the fully realized promise of the dloud. It has the most capex cost reduction of any cloud technology and combines it with the highest amount of productivity. velocity, and development agility. By freeing developers to focus on what they want to do – and on what they do best - we are enabling them to even more easily start companies and build products. And that is why AppFog is a Start-up Enabler. NoOps takes all of the exponential gains from each layer of this Cloud 2.0 and Start-ups in the Early 2000s vs. 2010s Normalized Total Deals Normalized Deal Size 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Sources: National Venture Capital Association and the UNH Center for Venture Research More start-ups are being created at an increasing see that the number of companies receiving seed funding has velocity. People have identified a decreased barrier-to- been increasing while at the same time the average size of entry as a major driver for this change. these seed rounds has been decreasing. What has been largely left out in these discussions, Thus, we can see that there are more companies being started however, is the role that core Cloud technologies have in this space – and that initial capitalization required for these played in this shift. The waves of exponential cost and companies has decreased. In looking at Angel investor deals (the leading indicator), we see the trend begin in 2002 and time savings that have been created by core Cloud technologies have made doing an internet startup easier, quicker and cheaper than ever before. accelerate in 2006. Across all investors, 2006 is the inflection point where the acceleration in number of deals done combine with the declining size of deal to indicate a paradigm shift in How do we know this? the market. If you look at the trends in Seed Stage funding, you will Final word: The future is NoOps. In the 1990s start-ups raised millions of dollars in seed team), would require no IT staff, would require $0 in hardware funding and spent a year building and launching a proof-of- budget, and would cost less than $250 a month for Cloud concept. Hardware budgets for this proof-of-concept alone services. Once launched, iteration on the product would be were around a million dollars. IT staffs when start-up quicker, easier and cheaper by orders of magnitude. Total funding required goes down by orders of magnitude. For your average companies launched the proof-of-concept was 4 the size of the dev team. And that was the standard. entrepreneur, this is the difference between "I wish I could do that" and "Screw it, let's just try it." If you were to recreate that start-up today, using these core Cloud technologies and following a NoOps approach, it would And that's what we live for - making everything a little less scary take 2 months to get to proof-of-concept (with the same dev and a whole lot easier. Technologies we proudly support, and more coming: python mongoDB redis MEMCACHED PHP PostgreSQL MYSQL. Microsoft Ruby Java Perl .NET CouchDB relax af appfog Copyright © 2012 AppFog, Inc. All Rights Reserved.