Optimizing Cloud Costs To Avoid Losing All For Same Winning Reason

The primary feature that brought prominence to cloud technology is virtualization which makes it possible to create virtual representations of servers, storage, networks, and other physical machines in one facility thereby driving down huge capital that would, otherwise, be sunk in procuring the physical machines.

Because of virtualization, companies easily avoided tieing down huge sums of capital expenditure on high-cost IT hardware procurement, commissioning, and maintenance that could be reasonably channeled into other business activities.

This brought about IT cost center decentralization that radically drove down costs for businesses.

However, in recent times, it's become a new ball game.

The once highly affordable cloud is now growing expensive.

According to a recent survey from ESG, more than half of companies say that their spending on public cloud apps will increase in 2023 while 56% expect their public cloud infrastructure services spending will go up this year.

A separate report from Gartner forecasts that worldwide spending on public cloud services will grow to a total of $591.8 billion in 2023, up from $490.3 billion in 2022.

The cost burden is such that many companies end up exceeding their budgets for the cloud.

Veritas, a cloud data management vendor, found in a 2022 poll that upwards of 94% of organizations incur higher costs than anticipated when using a public cloud service provider and overspend by an average of 43%.

It is no wonder then that cloud optimization software is attracting funding.

One of the recent vendors to benefit is ProsperOps, which today closed a $72 million funding round led by H.I.G. Growth Partners with participation from Active Capital and other unnamed investors.

In search of ways to ease the burden of cloud expenses, cloud optimization startup, ProsperOps, recently landed a $72M investment. Incredibly, prior to the investment, ProsperOps had only raised around $800,000.

Co-founder and CEO Chris Cochran says that the company approached H.I.G. to “scale given the market opportunity.”

ProsperOps’ founding team, including Cochran, takes credit for starting the AWS managed services business at Rackspace.

Cochran says that they saw firsthand how hard it was to optimize customer environments without automation.

“It didn’t matter how good the reporting and recommendation tools were.

"We were frustrated with the outcomes — or lack thereof,” Cochran said.

“We started ProsperOps to leverage automation, AI, and algorithmic management to help cloud customers generate better savings outcomes.”

 To that end, ProsperOps provides software that automatically optimizes cloud resources to deliver savings.

It assumes responsibility for reserved and savings plan management; customers configure a few high-level settings after which ProsperOps’ software learns to handle ongoing activities (e.g. day-to-day commit discount management, associated capacity planning, etc.).

Conclusion

Cloud tech giants like Amazon, Google, Microsoft, etc. were recently in the news for massive job cuts orchestrated by customers that either reduced their unpredictably spiraling cloud spends or opted out completely.

The development, no doubt, negatively impacted the overall cash flow of the cloud tech giants culminating in the layoff of employees.

This is the situation that ProsperOps is out to help with.

Hopefully, it will.