Over the last few years, as enterprises moved to containers to deploy and build applications, there was an increased need to manage these containers. Kubernetes emerged as the orchestration platform of choice for developers. For makers of enterprise applications, they then needed solutions to deploy Kubernetes applications to their customers’ environments. In comes Replicated, an enterprise software platform for Kubernetes that allows software companies to deliver their apps to customers, irrespective of the customer’s specific architecture, policies, or preferences. The multi-prem focus allows software vendors to focus on development while Replicated handles the individual delivery, license management, and troubleshooting. Think of it as a content delivery network for software that will work for any end-user, eliminating friction along the way.
LA TechWatch caught up with CEO and Cofounder Grant Miller to learn more about how Replicated takes a unique approach to Kubernetes delivery and management, the company’s strategic plans, recent round of funding, which brings the total funding raised to $85M, and much, much more.
Who were your investors, and how much did you raise?
Series C – $50M.
This round of funding is led by Owl Rock, a division of Blue Owl Capital, with participation from Lead Edge Capital, Headline, and existing investors, including Two Sigma Ventures, Amplify Partners, BoldStart, Ridgeline, and Heavybit.
Tell us about your product or service.
Replicated makes it easy for third-party software vendors to deliver and manage their Kubernetes apps in unique, customer-controlled environments at scale. This way, software vendors can specialize in their app dev efforts and widen their total addressable market.
More and more, businesses depend on IT innovation to drive revenue and broaden market opportunities. This innovation relies on the modern Kubernetes-based application, and while many organizations leverage these in the public cloud, they struggle to do so as much as they would like. Enabling technologies like IaaS and privacy and other regulations demand that some data remain ‘in-house,’ and so, too, must the applications that leverage that data. As a result, organizations need modern applications that can run in any of their preferred environments.
Organizations rely on third-party software vendors to develop these custom and modern applications. These third-party software vendors are skilled for app dev, but less so with the delivery and management of their apps.
We enable independent software vendors to quickly deliver and manage their cloud-native Kubernetes applications to virtually any on-prem, customer-controlled environment. By addressing app delivery needs like license management, channel targeting, and troubleshooting, Replicated simplifies the app lifecycle for software vendors so that they can specialize in what they do best — app development.
We also provide an airgap-ready Kubernetes distribution that vendors can bundle with their applications. With this, customers need only to bring a cluster of VMs if they don’t already have Kubernetes internally.
What inspired the start of Replicated?
Marc Campbell (CTO and cofounder) and I have backgrounds in container and SaaS technologies and saw an opportunity to help software vendors migrate their apps to on-prem and self-hosted environments using Kubernetes and cloud-native computing.
How is it different?
Replicated is truly carving out our own category in Kubernetes Application Management. While other companies focus on Kubernetes Infrastructure, such as Rancher, OpenShift, or Tanzu, Replicated is unique in our ability to provide a full-featured platform for the delivery and management of Kubernetes apps, even to enterprise software customers that aren’t running Kubernetes.
Delivering enterprise solutions to on-prem environments is time and resource-intensive for vendors and doesn’t often come with a great user experience. But for end-users who work in heightened data security and sovereignty environments, these modern third-party applications remain critical to their businesses. Software vendors need to be able to sell into these complex, customer-controlled environments with less friction to their own time and engineering resources.
What market are you targeting, and how big is it?
We target enterprise software vendors of all sizes. Those vendors may currently be providing SaaS, traditional on-prem, or open core versions of their applications. We help these vendors deliver their apps to any customer environment, including private cloud, on-prem, or even air gap. In 2020, on-prem software accounted for 400B of enterprise software spend.
The market for on-prem Kubernetes applications is four times larger than that for SaaS environments.
What’s your business model?
Pricing varies depending on the size of the deployment and the number of licenses issued.
How has COVID-19 impacted the business??
Replicated made a move to become an entirely remote company during COVID. As a result, we could take on talented team members from anywhere they may be. To properly provide a stable and comfortable remote culture, we’ve rolled out a revolutionary home office program to support our employees appropriately.
What was the funding process like?
Growth funding is a bit different than other rounds, with investors really looking for public company comparables and a path to a significant outcome. Also, fundraising over Zoom is pretty helpful as it reduces the travel required and allows you to meet various investors before selecting which firms you’ll move forward with.
What are the biggest challenges that you faced while raising capital?
It can be pretty exhausting to present and answer deep questions about your business for hours on end with a variety of investors.
What factors about your business led your investors to write the check?
Momentum. Team, leadership, customers, revenue, market all have had significant growth and momentum in the last 18+ months.
What are the milestones you plan to achieve in the next six months?
We are in the process of greatly expanding our team, as well as our product offerings. Most importantly, we are also expanding into international markets, with Israel, Germany, the U.K., and more in the coming months.
What advice can you offer companies in Los Angeles that do not have a fresh injection of capital in the bank?
Keep grinding. It took us a while to really find the momentum that was attractive to investors. We had to iterate our way to higher conversion rates through a better product and better positioning. The only answer is to stay focused on solving problems for customers.
Keep grinding. It took us a while to really find the momentum that was attractive to investors. We had to iterate our way to higher conversion rates through a better product and better positioning. The only answer is to stay focused on solving problems for customers.
Where do you see the company going now over the near term?
Focused on enabling customers to be even more successful with their application delivery by expanding the demand for multi-prem software.
What’s your favorite outdoor activity in LA?
Hiking in the Santa Monica Mountains on a Sunday morning.
