

$10 Million Round For Ruby On Rails Startup Heroku (YC W08) - whyleym
http://techcrunch.com/2010/05/10/former-microsoft-execs-lead-10-million-round-in-ruby-on-rails-startup-heroku/

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jacquesm
That's actually really cool. I'm not ruby/rails user, but if I were I would
certainly use Heroku, it is one of the YC backed companies that really stand
out for me.

From the design of their website to the naming schemes, the price points and
so on it all seems to be equally well thought out.

Back when considering which platform to try next (python/django or ruby/rails)
I was very impressed with the way they did their best to minimize the surprise
factor and to really inform the user up front of what they're getting in to.

The documentation is also excellent. I still don't know if I made the right
choice, but I'm a bit too far in to django now to easily back out again so I
guess I'll stick to it, but to see Heroku has now found very solid financing
is definitely a factor to consider.

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dschobel
I've only used it for proof of concept (read: free) projects and I agree with
you about everything but you see a lot of people bitching on HN about the
pricing and how costly it is to scale an app on Heroku.

Not sure how much of that is just venting or how much it actually keeps some
people at bay but it's pretty obvious some (anonymous people on an online
forum, FWIW...) think it too costly.

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jacquesm
I think they should factor in how much it would cost them to run this on their
own infrastructure for comparison purposes at the same levels where they'll
have to pay Heroku.

Only then you'd be comparing apples-to-apples and then you'd see that by the
time you've factored in the 24x7 system administration, monitoring, guy-on-
standby for when you're on the road and so on that it really isn't that bad.

Of course it will be higher in absolute dollars if you don't factor in your
own time and how much that costs, maybe there is even a small premium if you
do, but outsourcing has other advantages besides the ones that translate
directly in to money, and those can be valuable by themselves (for instance
the time freed up).

If you can't make your business model earn back what Heroku costs you at a
given scale then that is of course a problem, but if you can't do that then
you probably have a problem anyway, and even free servers wouldn't solve that.

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markbao
Heroku user here. One word encompasses Heroku: incredible. Fastest Rails
deployment I have ever seen. I'm not surprised that they received the
funding—more like really excited.

EDIT: Also, the add-ons they have are really good, and they have a ton in the
pipeline. They have all the tools I needed to get up-and-running (including a
tool that sends your local DB to the production Heroku server or vice versa in
one command).

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waxman
One of the longstanding hesitations for cloud computing is "my whole business
will depend on someone else's business, what if they go under?"

With $10mm in the bank, 60k apps in the cloud, Amazon's AWS backend, Heroku's
rockstar team, and a real revenue model, I think it's safe to say that you can
bet your business on Heroku.

My new project sure as hell will...

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tlrobinson
Even before they were "proven" I think Heroku was significantly less risky
than some other platforms, since it's a pretty standard open source stack.

If you really had to move off of Heroku (if they went under or become
prohibitively expensive) you could move onto your own servers running
essentially the same stack (except of course manually configured and
maintained), which is more than you can say for AppEngine, for example.

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terrellm
Congrats guys - 60,000 app milestone last week, $10m funding this week.

It's a great service and I'm glad to see it continue to grow.

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vtail
Anybody knows what percentage of these 60,000 apps are actual paying clients?
If e.g. 50,000 of these apps are free, even for a modest cost of $3/month to
host each one, that quickly adds up to ~$2mn of cash burn / year.

Another interesting question is how well they scale.
<http://success.heroku.com/> has some interesting companies, but nothing with
very high traffic (or am I wrong)?

PS. I'm a happy heroku user myself.

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ichverstehe
The trick with the free apps are, that you only have one dyno. And after a
certain amount of inactivity it will be shut down. Next time somebody tries to
reach your app, it will automatically be started again. So, the majority of
these free apps are practically no-cost for Heroku.

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mark_l_watson
Exactly right. Pay, and you don't get loading request delays.

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ique
Congratulations to Heroku! I've been using their service for years and it is
truly awesome. I hope this money pushes them even further.

One note on the article though, it says: "Heroku aims to make software
development more accessible for a wider range of people. It does so by
providing a browser-based programming environment that cuts out steps
traditionally needed to produce RoR applications."

Didn't they cut that entirely? Even Heroku Garden is closed right?

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jackowayed
You're right. They must have some really old stock summary from when they
wrote about Heroku long ago. Heroku's business is exclusively hosting Ruby
(and now Node.js) apps that you write normally.

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minalecs
Wondering ? has anyone migrated from engine yard to heroku or vice versa, and
reasoning. I've read several reasons on why one is better than the other, but
just wondering what some of the users experiences are

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andrewvc
My company's a paying customer and we migrated from EY to Heroku.

I think they're roughly comparable but the deal breakers for me were Postgres,
Addons, and the Git Workflow.

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minalecs
so .. did you go back to engine yard ?

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trevorturk
I'm wondering why they need to raise money at all. Aren't they charging for
their services? I'd feel more comfortable knowing that they're a self-
sustaining business, as opposed to a startup that needs to raise money. Maybe
there's a good reason, though...?

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jacquesm
You don't raise 10 million if you don't know what you're raising it for, to me
this speaks of a fairly detailed plan on how they intend to spend that money.

Think of money that you can get your hands on before you've earned it as a
growth accelerator. You could for instance stave off a potential competitor by
grabbing a larger share of the market than you would have been able to do if
you both relied on organic growth. In the arms races that start-ups are bound
to find themselves in sooner or later a couple of million in hard cash can
make an enormous difference in the long term outcome.

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wrs
Yes, but specifically talking about Heroku, what do you suppose the plan is?
If it were Engine Yard (at least the pre-EC2 version) I would know--they need
to buy a lot of servers. But I figured Heroku would be able to stay a lean
mean profit machine without taking big funding. Is their model out of whack?
Too many free apps (aka marketing expense) to be subsidized by the paid ones?

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jacquesm
If I were to hazard a guess I would say they are planning a very large roll-
out with some heavy hitting marketing and they expect the free traffic to go
through the roof for a while, significantly outpacing the normal conversion
rate, and hence their ability to finance this out of their normal cashflow.
Another option is that they intend to take over a competitor (EY you've
already mentioned, I'm not even aware of any others in the ROR space, but
there may be more), if that's it they'll be facing some major integration
issues due to the different approaches.

But that's really looking at the tea-leaves, I have 0 evidence for any that.

It would make some sense though, given that they've ironed out a lot of the
issues they had initially, their price points have been adjusted to the point
where a lot of the users are happy (and I find it commendable how they worked
with the userbase establishing how much was reasonable), the only thing they
have to do now is sit back and watch it grow.

But they may have decided that sitting back and watching is not their style.

Time will tell, but I'll certainly be watching for any major announcement.

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justindz
Grats guys. One of my favorite web services, ever. One day when my actual job
keeps me a bit less busy, I'll be upgrading my service and using it even more.

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djb_hackernews
This my be the wrong question since I'm not too familiar with Heroku, but is
anyone working on something similar for Django?

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waxman
Isn't that what Google App Engine is?

Heroku is a cloud-based deployment and hosting solution for Ruby apps (and
soon to be Node.js javascript apps too). Google App Engine is for Python and
Java.

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weixiyen
goog app engine doesn't work with tornado =/

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csytan
Yes it does.

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messel
As a guy who learned a little php for the first time last year, and then moved
on to Ruby late in the year Heroku has been very helpful to kicking Rails
servers live.

A+ for ease of use, and as I learn more I see opportunities in other server
environments. My cofounder is kicking up nginx, thin and padrino

My favorite heroku project (and personal first)
<http://imagebrowser.heroku.com> enjoy. Semantic entity extraction and image
browsing as well as search within twitter streams.

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frou_dh
I was so impressed with the design and usability of Heroku's site and system -
it's near perfection, which is a hard thing to say about software.

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timinman
From the rate that these guys innovate, it's obvious they're working hard -
and at the right things. I'd bet this will pay off for the investors.

I have one app on heroku, it's probably easier to use, but I have more apps on
Google Appengine with jruby simply because it stays free-er for longer. I've
come up against Heroku's free limits.

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drewjohnson
I loaded my first Heroku app last week. As promised, they made it very easy
and snappy to deploy. When I ran into a problem, I was able to file a ticket
and get a resolution by the next business day. Phenomenal service, especially
considering I was only using their free offering.

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friendstock
congratulations!

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mark_l_watson
Good for them. Heroku provides great service, and I wish them well.

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chuhnk
Love heroku for my micro sinatra apps. A well deserved $10mil

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c00p3r
It is really cool startup. Smart concept - git powered deployment, very clear
and beautifully visualized information, and excellent, even stunning web
design. Add to that some Japanese/Zen flavor and it's almost perfect. Very
good taste.

I'm glad that they're successful. It's good when a good taste wins.

