From AWS to Series A in 5 Easy Pieces


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Venture capitalist Matt Ocko’s 20-year track record of success in the startup world has given him unique insight into how AWS has changed the venture financing process.  In this session, you’ll learn about industries susceptible to disruption by AWS-based startups, and where VCs are willing to take new risks on those startups, including the heavily-regulated medical,  government, financial, and industrial sectors.  Matt will talk about how new, supercomputing startups are now possible because of AWS technologies.  Hear about how using AWS technologies can actually reduce risk – and reduce time to customer penetration – from a VC perspective, and how to go from ‘AWS to Series A’ in 5 easy pieces.

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From AWS to Series A in 5 Easy Pieces

  1. 1. DCVC Management Co., LLC Content. © 2014 DCVC Management Co., LLC. All rights reserved. AWS Summit 2014 slide templates. © 2014, Inc. and its affiliates. All rights reserved. May not be copied, modified, or distributed in whole or in part without the express consent of, Inc. From AWS to Series A In 5 Easy Pieces Matt Ocko (@mattocko), Data Collective (@DCVC) March 26, 2014
  2. 2. Widely Held View of VC & Startups
  3. 3. It’s Not That Bad, and AWS Can Help • Reduce your startup cost • Accelerate your time to market • Create a differentiated startup, get VCs’ attention • Prove to VCs there’s an enterprise-grade product • Help get customers more rapidly All of which help to • Preserve founder equity • Increase chances of funding • Decrease time to get funding • Increase valuation in Series A • Increase valuation in subsequent rounds
  4. 4. The Five Easy Pieces • Be brave – Even in heavily regulated industries; go where others fear • Be simple but smart – Don’t use features you don’t need, keep failure modes minimal • Design for resiliency and uptime – Assume you will be hacked, crashed, fat-fingered • Plan for scale – Design and test for success • Build for the zero-touch sale – Use AWS to your advantage to make customer engagement frictionless
  5. 5. The VC Perspective • Be brave • Be simple but smart • Design for resiliency • Plan for scale • Build for zero-touch sale  Don’t want to fund the 11th SaaS whatever  Simple=fast adaptation=lower risk  Enterprises don’t tolerate broken consumer s---  See above, plus tiny businesses uninteresting  First to customer w/ best experience wins
  6. 6. Be Brave • Now possible to attack regulated industries – VPC to meet regulatory hurdles – CloudHSM for customer crypto friendliness – Good soft crypto for overlay on top of S3 – Glacier for long-term records retention – CloudTrail and Loggly for auditability • Good enough for CIA, good enough for F500 • HIPAA, SARBOX, Dodd-Frank are good barriers
  7. 7. Be simple but smart • Don’t overengineer – If you’re not doing crazy TPS, ELB works fine; Beanstalk! – Redshift and results vs. months of engineering • Consider costs before implementing – Is it cheaper to run your own stuff on bare nodes, or…? – Do not underestimate ops costs when doing this calculation • Be reductionist about core processes – Use AWS to simplify, where possible – huge time value
  8. 8. Design for resiliency • Think in multiple AZ from day one – AWS features to manage this complexity (RDS) where possible • Stateless where possible, backup where not – Either via AWS features or via S3 • Real time monitoring – Whether CloudWatch, NewRelic, etc. • Redundancy of data, state, compute – Either your own code, or novel solutions like CloudVelocity
  9. 9. Plan for scale • Simplicity pays off: clone and conquer – Ability to add capacity by cloning your modules, AWS for rest • Consider in advance how demand will burst – And where you need to code vs rely on AWS • Understand your costs; don’t recklessly burn $ – Don’t use nodes like cannon-fodder; solutions like Cloudability • Culture is part of successful scaling – Focus on results vs. engineering fetish, NIH
  10. 10. Build for the zero-touch sale • There’s no such thing, but key aspiration – First to the customer, with lowest friction, wins • Be creative with AWS to drive towards this – More than customer sandboxes: complete systems – Start with sample data, then allow upload – Heck, sell the customer the final state sandbox • Consider how AWS elasticity solves post-sale – Ability to clone customer config for debug, hot standbys, rollback
  11. 11. EXAMPLES • Companies that have executed to the “Five Easy Pieces” • Covering who they are, and some (not all) of how they use AWS
  12. 12. BlueTalon • Emerging leader in secure data collaboration and unification across enterprise boundaries • Cloud-based BlueTalon Virtual Database integrates data from multiple databases on the fly • Demanding Fortune 500 customers
  13. 13. BlueTalon on AWS for Developers • Bring data from on-prem databases into cloud apps • Integrate data from disparate databases • Implement data policies for privacy and selective access
  14. 14. Automate Setup with AWS VPC AWS Feature • VPC with Private and Public Subnet and Hardware VPN Access – Spin out pre-configured combinations of nodes with security rules – Pre-configured VPN connectivity to datacenter BlueTalon Advantage • Quick customer setups – hours not days • More secure setups – no accidental security holes
  15. 15. Integrate AWS IAM in BlueTalon UI AWS Feature • APIs to use AWS IAM within custom web apps – Reuse IAM identities in BlueTalon through APIs – Use right level of IAM access for operations within BlueTalon BlueTalon Advantage • More secure operations, – no need to see customer data to setup BlueTalon • Seamless administration – Operations transfer continously from AWS to BlueTalon
  16. 16. Simplify your life on AWS
  17. 17. Drone Deploy
  18. 18. Berkeley Marina, 20 min, 1 drone • In visual and NVDI, single pass • Single click flight plan • Auto streaming and processing
  19. 19. AWS + Drone Deploy Communication
  20. 20. AWS + Drone Deploy Data Processing
  21. 21. Future AWS + Drone Deploy
  22. 22. Prism Skylabs - Video
  23. 23. How Prism uses AWS • S3 – Easily and securely store at-rest data – Seamless on-disk encryption • ELB (Elastic Load Balancers) – Handle all of our API calls/traffic over SSL – Provide SSL for all API calls and data transmission without the need for additional computational overhead • EC2 (Elastic Compute Cloud) – Global infrastructure enables near-infinite scalability and worldwide deployment
  24. 24. How AWS has helped Prism • Deploy Instantly – Add on high-volume customers without worrying about network or server load. • Connect cameras to the cloud – Intelligently extract images and meta data at less than 50kb per second • Store data infinitely – Any number of users can access images or analytics over any time period • Analysis on demand – Immediate understanding of activity and movement in any physical space • Present dynamic visual summaries to customers – Transform mountains of data into intuitive imagery
  25. 25. 10kb DNA molecule Sequencer In-silico synthetic DNA read assembly Moleculo: $500m+ value, saving lives
  26. 26. AWS customer Downstream application sequencer • 70GB of input data per sample • >2000 Core*hours • 10s-100s samples / day • AWS was a natural solution • But, EC2 accounted for 90% of the cost AWS natural solution for Moleculo
  27. 27. Moleculo System Architecture Workflow manager ES3 WWW S3Uploader ES3 m2.xlarge OMjobs OM controller c1.xlarge Cc1.4.xlarge
  28. 28. How many core*hours can $100 buy? - 2,000 4,000 6,000 8,000 10,000 12,000 Rackspace Google cloud Amazon on demand Amazon reserved Hardware Spot Instances
  29. 29. Putting unused global capacity to work
  30. 30. GAPP – genome analysis app BWA Mark Duplicates Indel Realignment Base Quality Recalibration Haplotype Caller Variant Recalibrator VC F FAST Q BA M or 10 times fewer errors than **** Metric GAPP **** SNP: concordant: 592,314 572,311 false positives: 820 20,823 false negatives: 4,946 21,227 Indels concordant: 65,666 41,297 false positives: 2,712 27,081 false negatives: 3,545 27,679 Accuracy Speed Cost
  31. 31. Genome analysis job sample graph
  32. 32. Speed: Job graph analysis enables parallel execution Accuracy Speed Cost Speed: 30x WGS < 3 hours BWA BWA chr1 chrN Split GATK GATK Split GATK GATK final.vcf FAST Q BWA BWA chr1 chrN Split chr1.vcf GATK GATK Split chrN.vcf GATK GATK KEY TO JOB : Map Reduce These jobs can be run in parallel * * *
  33. 33. Price: Spot instance bidding => 10x cost reduction average < $0.01/core*hour 30x WGS GATK takes ~ 1000 core*hours Cost: 30x WGS < $10 Accuracy Speed Cost 0 0.01 0.02 0.03 0.04 0.05 0.06 0.07 0.08 Oregon Virginia Australia Price(cents/CPU-hour) cc2.8xlarge c1.xlarge c3.4xlarge c3.8xlarge cr1.8xlarge cc2.8xlarge c1.xlarge c3.4xlarge c3.8xlarge cc1.4xlarge cr1.8xlarge c1.xlarge c3.4xlarge c3.8xlarge
  34. 34. Thank you – open for questions
  35. 35. DCVC Management Co., LLC Content. © 2014 DCVC Management Co., LLC. All rights reserved. AWS Summit 2014 slide templates. © 2014, Inc. and its affiliates. All rights reserved. May not be copied, modified, or distributed in whole or in part without the express consent of, Inc. From AWS to Series A In 5 Easy Pieces Matt Ocko (@mattocko), Data Collective (@DCVC) March 26, 2014 Thank you!