With mission to modernize data streaming, Redpanda snares $50M Series B

When Redpanda launched in 2019, company founder and CEO Alexander Gallego thought a startup devoted to modernizing streaming data should have an appropriately nerdy name. He called it Vectorized, while the product he created was known as Redpanda. He soon learned, however, that people loved the name of the product, so he decided the company should share that name.

“Redpanda has nothing to do with streaming, but when we sent out surveys, people loved the name and it just kind of took over,” Gallego told me. Redpanda has developed an open source streaming tool, designed to take a modern approach to data streaming technology while remaining backward compatible with Apache Kafka, the open source data streaming tool the company is hoping to replace.

Regardless of what you call it, the startup is doing well enough to warrant a $50 million Series B investment, and the investor interest is partly due to the growing popularity of the approach. “From an adoption perspective, we went from thousands of clusters deployed at the beginning of the year [when we launched Redpanda] to hundreds of thousands of clusters deployed by the end of the year. And today, we’re deploying more clusters per day than we did in the first six months,” Gallego told me.

One of the main reasons for that growth is the company’s new focus on limitless data retention, a capability that he said is capturing the attention of the developers.

“What’s happened in the market is that streaming is now the foundational part of how to build new modern applications. It sits as the bottom layer on which to build new applications. And for that you need unification, and what I mean by that is you need limitless data retention. And so that feature alone actually changed how the market perceived and how developers think about real-time data,” Gallego explained.

He said that the company is able to provide this infinite retention because of its approach to streaming. For starters, it reduced a lot of the complexity into a single tool, eliminating the need for multiple systems to run different parts of the streaming process. They combined that with low-cost cloud-native storage solutions and WebAssembly, an open source approach to running high-performance web applications.

Companies using Redpanda include Akamai, Cisco and Sprout. The company has grown from 22 employees when we last spoke in January 2021 to around 60 today, with plans to continue adding people with help from the new funds.

Last year, Gallego said that as a Latino founder, he found that it helps attract a more diverse workforce. As he grows the company, that continues to be the case, and not just from his network. “It wasn’t just that we motivated Latino developers that come from my network of friends — we actually attracted people from all over the world in a multitude of countries and people from super big companies like Google, Uber and Facebook, etc. So it has worked,” he said.

The company also has a scholarship program called Hack the Planet, which he described last year at the time of his previous funding:

“I started a scholarship where we just give money and mentorship to communities of Latino, Black and female developers, or people that want to transition to software engineering,” he said. While he says he does it without strings attached, he does hope that some of these folks could become part of the tech industry eventually, and perhaps even work at his company.

Today’s round was led by GV with participation from Lightspeed Venture Partners and Haystack VC. The company has now raised over $65 million.