In order to harness the true power of the cloud, organizations must find a way to integrate their legacy relational databases like SQL. Cockroach Labs helps companies solve this challenge through its post-Oracle cloud-native distributed database that’s totally SQL-compliant. The company, founded in 2015, offers scalable solutions that can also be used across data centers to offer localization as needed. The signature product, CockroachDB, has out-scaled Amazon’s Aurora by 50x. Many notable companies including Bose, WeWork, and Comcast are already customers.
AlleyWatch sat down with CEO and Cofounder Spencer Kimball to learn more about the company, the future of databases, and the company’s latest funding round, which brings its total funding to $108.5M over four rounds.
Who were your investors and how much did you raise?
This is our Series C raise, led by Kevin Wang at Altimeter Capital with participation from Tiger Global, GV, Redpoint, Benchmark, Index, FirstMark, and Work-Bench. We raised $55M.
Tell us about the product or service that Cockroach Labs offers.
CockroachDB is a post-Oracle cloud-native distributed database. It’s fully SQL-compliant but is developed from the ground up to take advantage of the global cloud. CockroachDB can use cloud resources within a data center for scale, resources across many data centers for superior business continuity, and resources across continents to domicile and process data close to customers for enhanced privacy and instantaneous UX.
Our founding team worked at Google for a decade-spanning 2002-2012. Google was an early leader in distributed database technology. In the aughts, Google’s data center footprint was immense compared to what was available to everyone else. Now, even a startup has access to a similar range of resources via the global public cloud. We started Cockroach Labs to bring this new technology to the world as open-source software.
How is Cockroach Labs different?
The big differentiator for CockroachDB is that it’s a geo-distributed SQL database. The “geo” part of that description is important. It’s what allows CockroachDB to up the ante significantly in terms of how businesses cope with data center-level failures (hint: they’re no longer disasters). It’s also what allows CockroachDB to provide the foundation for the next generation of global applications, which can keep data and cloud-based logic within customers’ legal jurisdictions while providing an instantaneous user experience. This will be crucial for enabling 5G use cases like AR/VR, autonomous driving, interactive media, and gaming, etc.
What market does Cockroach Labs target and how big is it?
Relational databases, which is roughly $50B/year.
What’s your business model?
Our business model was traditionally open core, but that has expanded with the release of our cloud-based service, CockroachCloud, which provides CockroachDB as a DBaaS.
How has the business changed since we last spoke in 2017 after Cockroach’s Series B round?
On the product side, we released CockroachCloud last October. Between our DBaaS offering and significant sales to the Global 2000, our sales efforts have been expanded rapidly, leading to this series C raise.
What was the funding process like?
This round of funding was very smooth. Kevin Wang at Altimeter has been working with us for years now and there is significant alignment between his ideas about cloud infrastructure and the opportunity Cockroach Labs is pursuing. We were also very pleased to add Tiger Global to the mix, given their reputation and resources.
What are the biggest challenges that you faced while raising capital?
Saying no to some very good investors in order to put the round together.
What factors about your business led your investors to write the check?
The sheer size of the market we’re addressing as well as our performance over the past six quarters.
What are the milestones you plan to achieve in the next six months?
We expect to grow the team from roughly 100 to more than 135, and we’ll be looking for more office space. Again.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Run lean. If that’s not possible, consider venture debt as an option. We never stop talking to prospective investors. Capital is much easier to raise when you have good relationships in place and understand how a new investor will complement your network and thinking about your opportunity.
Where do you see the company going now over the near term?
Building our revenue base, adding important logos, rapidly expanding product capabilities and form factors. The reality is that we have Oracle on one side and Amazon AWS on the other, so this capital is crucial for competing effectively.
What’s your favorite rooftop bar in NYC to unwind?
Our office is right next to Eataly, so we recently had a very nice event at the SERRA by Birreria restaurant up on the roof.