We dig deep into their companyâs mission/principles/values, hear how it it all started with a VCâs blank check that turned out to be anything but, and learn how Oxideâs integrated approach to hardware & software sets them up to compete with the established players by building servers as they should be.
Bryan Cantrill: Yeah, well, you should talk to some of those folks, because those folks are in excruciating pain, for a bunch of reasons. First of all, they are all generally cloud-aware. Sometimes people are like âOh, I love that Oxide â youâre a contrarian cloud play.â Itâs like, no, no, we are not anti-cloud. We are very, very pro-cloud. Elastic infrastructure is an incredibly important development, and we are very, very pro Elastic infrastructure, to be clear; very pro cloud computing. We just believe that you shouldnât have to rent all of it. We believe that you should be able to buy some of it, because when youâre renting compute, the Mooreâs Law dividend is going to your service provider, not to you. And we believe that there are folks who got compute at a scale where it makes sense to own a computer, and own a rack of computers.
So the folks that we are targeting are folks that are already on-prem; they are on-prem for good reasons. Those reasons - they may be security, maybe theyâre latency⌠Theyâre very often economic. AWS is expensive. The public cloud is expensive, especially when youâre at a certain scale. And thereâs a certain scale you get to where actually the public cloud is debilitatingly expensive. I canât even contemplate the cloud of this workload. So those folks - they are cloud-aware, theyâre running their own hardware, and they are stuck on this personal computer that hasnât meaningfully moved in 20 years. And when they buy something from Dell, or from HP, or from Supermicro they then are responsible for putting the software on top of it. Itâs like, youâre not running Dell on itâs own, youâre running Dell + VMware; youâre running Dell, plus VMware, plus Cisco, plus software to manage the network. And plus your distributed storage system, whatever that is. And whenever anything goes wrong - well, you assembled this thing, so this is on you. And every vendor points at everyone else. And boy, I lived this; we were Dell customers.
[01:04:19.09] I just remember â I mean, I told Dell a lot of things over the years. One of them is âNever tell me youâve never heard of this problem before. Iâm not interested. All that is telling me is that your most technical customers are leaving Dellâ, which is actually whatâs happening. And so when you are having a problem, itâs like âYeah, Dell was telling me Iâm the only one seeing this.â Itâs like no, Dell was trying to gaslight you into believing youâre the only one seeing this, because Dell itself does not have the depth of competence to actually understand whatâs going on, on their systems. Because Dell - and Supermicro is taking it to an even greater extreme, of⌠Thereâs this self fulfilling prophecy that this is commoditized garbage, so weâre going to treat it as commoditize garbage. But itâs actually really expensive. I mean, if you look at a racked-out Dell 2U server, itâs expensive. And we havenât even got the software on there yet. We havenât gotten VMware, or OpenStack, or whatever you end up putting on this thing to manage it.
For Oxide, not only are we taking the fresh approach to hardware, but also software co-design. We are actually developing the Hypervisor, the control plane. What you get is an actual cloud in that rack. You hit API endpoints, you provision. You donât buy VMware to put it on this rack.
So for our target demographic, they have been grossly underserved. In fact, the existing infrastructure providers have denied they even exist. Theyâre like, âWell, every on-prem use case is going to the public cloud.â Itâs like, *bleep*. I mean, I know about the public cloud, I understand the public cloud. This workload needs to run on-prem for economic reasons. But this is not a legacy workload; this is not going anywhere. And to be told that you effectively donât exist, and then be more or less treated that way - itâs pretty aggravating.
So you know, our target demographic is kind of worked up. Theyâve kind of had enough. Actually, when we were doing due diligence for the initial VC investment, and having VCs talk to some of our first prospective customers⌠Theyâre angry. So one of the feedback â we got some feedback from some of the VCs, like âYour early customers - theyâre agitated.â Iâm like, âYeah, theyâre pissed. Theyâre pissed. Theyâre definitely pissed. And donât try to tell them that they donât exist. Thatâs a mistake.â Because what they have seen is all of this innovation happening in all of these dimensions around them. And all of the innovation around Elastic Compute happening on the public cloud, and where they need to run it, they have been entirely deprived. So what they see in Oxide is oxygen. âSomeone who understands what Iâm trying ââ And yes, I mean, the aesthetics are extraordinary, and the rack really is beautiful, Iâve gotta say. The rack - it is so good-looking; it is a really good-looking rack. But what weâre doing is much deeper than that. Itâs much deeper than the aesthetics. It is a true first-principles approach that allows them to actually appreciate some of those advantages that folks have in the public cloud. And then they can go focus their energies on their business, and on building the software and supporting the software, supporting the developers that they need to go build a better product, build a better service.
And what we see is, you know, our target demographic is really started on those excellent enterprises, excellent Dell customers. The customers that we see on the horizon are those folks that are born in the cloud, and then wake up to a business that is actually not sustainable, because their margin is actually going to Amazon.
[01:08:00.27] And over the years, there have been many of these folks who have come up to the edge and like, âWeâre going to build our own data centersâ, and theyâre naive about how bad the market is, so they go in like, âI donât know, Iâm gonna buy some Dell, or whatever.â Itâs like, âOh, God⌠Yeah, youâre gonna learn just how awful it is.â And they ended up vacillating; you know, going on-prem a little bit, but then staying on the cloud. And we believe that if you give those folks a real off-ramp where they can have the power of cloud computing, but with the economics of an on-prem data center, thereâs real demand for that on these cloud-born SaaS companies. So thatâs the future that we see.