Cloudability to Graduate from TechStars Cloud with 2k+ Customers

[ Cloudability founders Jon Frisby, Mat Ellis and J.R. Storment at the TechStars Cloud office in San Antonio. Photo courtesy of Cloudability. ]

From startups to Fortune 500 behemoths, everybody is using cloud-based services like Google Apps and Dropbox, Amazon Web Services and Rackspace.

But does any organization actually know how much it spends on the cloud across the board (since employees often sign up for services and expense them) and how to keep costs under control?

Manually entering data into a spreadsheet is one less-than-attractive option for avoiding a "who forgot to turn off the extra servers before the weekend" situation. Or you could sign up with -- what else -- a freemium SaaS company like Portland, Oregon-based Cloudability, which bills itself both as and a security blanket for the cloud.

Cloudability sends you a daily email that shows how much you've spent so far that month, your estimated total for the month (based on its algorithm), and how much you spent the previous month.

If the total is in green, you're spending less than the month before, and if it's red, you better dig into your Cloudability dashboard to find out why costs are spiking. Your dashboard lets you manage your budget and see how efficiently you are using cloud-based services. Cloudability will also recommend ways to save money.

Notably, Cloudability has partnered with (most recently) Rackspace, AWS, AppFog, Eucalyptus, HP Cloud, Puppet Labs, SendGrid, and Softlayer. The Rackspace partnership goes the farthest: customers can monitor their Rackspace usage for free no matter how much they spend each month. The idea is that many of Rackspace's 175k customers will become Cloudability customers so they can manage all their cloud services there.

If you spend less than $2.5k per month on cloud services, your Cloudability account is free. Plans range from $49/month for $10k/month spend to $650/month for "massive" spend.

Formed in April 2011, Cloudability debuted at GigaOm's Structure event in June 2011, where it was named a hot startup to watch, then moved into the Portland Incubator Experiment (PIE) in September before launching its public beta in early November and joining the inaugural TechStars Cloud class in San Antonio in January.

The company raised a $1.2M seed round in December from Trinity Ventures and Walden Venture Capital, and will have its next big moment at the TechStars Cloud Demo Day on Wednesday, April 11 as it seeks to raise a Series A.

Along the way, it has signed on 2,150 companies in 80 countries and is managing over $53M in cloud spending, up from 200 companies and $5M in spend just six months ago. Right now you can keep tabs on over 100 cloud services, including Evernote, Grasshopper, Heroku, Salesforce, Twilio and Zendesk; the company expects to include 250 services by next year.

The team has grown from founders CEO Mat Ellis, tech lead Jon Frisby and chief customer officer J.R. Storment to 10 full-timers.

J.R. told LAUNCH the TechStars program allowed Cloudability, which had done plenty of customer testing already, to "dive deeply with mentors on how we accelerate sales and adoption. From a business-development perspective, it's been phenomenal for us. All the people we needed to be talking to as partners were involved with the program."

In addition to partnerships with big players like AWS and Rackspace, Cloudability is betting on what J.R. calls the "trickle up" approach to customer growth: a developer at a startup or corporation might start using Cloudability for his own projects, and when the boss starts looking for something to manage their complex cloud spending, the developer can tell them about Cloudability.

In terms of security issues, J.R. points out they "had to be a security company from day one" so companies would trust them with their cloud-services logins/passwords as well as data. Cloudability is thrilled that AWS has finally added identity access management (IAM) so that it can access only usage and billing data rather than a customer's whole account.  As more cloud services offer IAM, Cloudability sees one of the main arguments against their service falling away.

Of course, Cloudability has plenty of company in this market, including CloudVertical, CloudCruiser, Newvem, uptimeCloud and CloudFloor, some of which popped up following a New York Times reprint of a GigaOm article last July.

Beyond the traction they already have, J.R. says Cloudability differs from competitors in the breadth of cloud services they connect to (some are only for AWS), as well as the optimization info they provide.

Cloudability's founders, all startup veterans, are applying lessons learned from past companies.

J.R. notes they talked to potential customers early on and often to avoid building features no one wanted. Each founder knows what he is responsible for, and they have agreed that Mat is the final decision-maker, meaning no time wasted on building consensus. And "inspired by another Portland company" -- J.R. mentions PHP Fog -- they started talking publicly about their product early on, even before it was built.

"The philosophy of build it and they will come -- it doesn't work," says J.R.


Cloudability's daily email shows you how much money you are spending and where so you can take action (if necessary) before your next bill arrives.

The dashboard gives visual breakdowns of your cloud spending.

You can also download reports by service.


Twitter: @cloudability

Mat Ellis, CEO
Twitter: @matellis

J.R. Storment, chief customer officer
Twitter: @stormental

Jon Frisby, VP engineering
Twitter: @mrjoy