Startups

Upstash’s serverless data platform hits ARR of $1M just two years after seed funding

Comment

Conceptual image of data flowing as dots of light in a grid.
Image Credits: zf L / Getty Images

Upstash announced a $1.9 million seed round almost exactly two years ago, and an idea for building a serverless data platform for data-intensive applications built with Redis and Kafka. That doesn’t feel like that long ago, but a lot has changed in the data landscape since then.

Fast-forward to now and the company is boasting ARR of $1 million, a $10 million Series A led by a16z and a shiny new vector database. What’s changed in those two short years since the company launched is the growth of generative AI, which as you may have noticed is a pretty data-intensive application.

Company founder and CEO Enes Akar says that his idea to create a consumption-based pricing model, meaning you don’t pay until data starts moving through the system, has been a compelling one to developers, especially those using Kafka or Redis for data.

He says that the pricing model reduces the risk for creating applications. “Consumption pricing is our biggest differentiation in the market because it removes barriers for developers. As a developer, if I start a company I don’t have to pay until I get some real traffic and it becomes really popular,” Akar told TechCrunch.

The approach seems to be working with the company growing from 12,000 developers in March 2022 to 85,000 today. That kind of traction tends to attract attention, and Akar says Andreessen Horowitz actually approached him about funding, not a story you hear much these days in times of tightening purse strings from investors.

He got an unsolicited email last June from a16z offering a meeting, but Akar says he wasn’t looking for additional funding. In fact, he was more interested in staying independent while he built up the business, but when they offered to have a chat over Indian food in downtown Palo Alto, he decided to at least have a chat, because he joked, he really wanted to try that restaurant anyway.

Over dinner it came up that he didn’t have to start a board of directors to get this funding, and that got his attention because of his desire to remain independent as long as he could. “I felt like it was still early. I still had money. I also had some aggressive objectives like creating new products, but I told them I wasn’t interested,” he said.

By August, however, as he watched generative AI begin to really take hold, he had second thoughts. Akar, who is from Eskisehir, Turkey, was back home on vacation when he decided to call back to see if they were still interested in providing the funding. It turned out that they were and they began negotiating. The deal closed about a month later.

The new vector database, which plays a key role in helping find information in generative AI applications is a direct response to the big interest in this technology, and is specifically targeting AI developers. “So before Upstash Vector, we had seen many developers using Upstash to develop AI applications together with OpenAI APIs or Hugging Face APIs and they use Upstash Redis for caching and storing data. Now we’ve introduced Upstash Vector, which they can use just like Pine Cone or other vector databases,” he said.

The company, which currently has around 16 employees, with many of the employees still based in Turkey, recently hired Melek Pelen Esin, his longtime friend, whose background includes an MBA from MIT, a stint at McKinsey and time at Facebook in a sales management position, as COO. She’s running the business side of the house, while Akar runs engineering. They are both based in Silicon Valley.

They plan to hire another 15 or so employees in the next year, concentrating on professional support and customer success.

More TechCrunch

Ahead of the AI safety summit kicking off in Seoul, South Korea later this week, its co-host the United Kingdom is expanding its own efforts in the field. The AI…

UK opens office in San Francisco to tackle AI risk

Companies are always looking for an edge, and searching for ways to encourage their employees to innovate. One way to do that is by running an internal hackathon around a…

Why companies are turning to internal hackathons

Featured Article

I’m rooting for Melinda French Gates to fix tech’s broken ‘brilliant jerk’ culture

Women in tech still face a shocking level of mistreatment at work. Melinda French Gates is one of the few working to change that.

14 hours ago
I’m rooting for Melinda French Gates to fix tech’s  broken ‘brilliant jerk’ culture

Blue Origin has successfully completed its NS-25 mission, resuming crewed flights for the first time in nearly two years. The mission brought six tourist crew members to the edge of…

Blue Origin successfully launches its first crewed mission since 2022

Creative Artists Agency (CAA), one of the top entertainment and sports talent agencies, is hoping to be at the forefront of AI protection services for celebrities in Hollywood. With many…

Hollywood agency CAA aims to help stars manage their own AI likenesses

Expedia says Rathi Murthy and Sreenivas Rachamadugu, respectively its CTO and senior vice president of core services product & engineering, are no longer employed at the travel booking company. In…

Expedia says two execs dismissed after ‘violation of company policy’

Welcome back to TechCrunch’s Week in Review. This week had two major events from OpenAI and Google. OpenAI’s spring update event saw the reveal of its new model, GPT-4o, which…

OpenAI and Google lay out their competing AI visions

When Jeffrey Wang posted to X asking if anyone wanted to go in on an order of fancy-but-affordable office nap pods, he didn’t expect the post to go viral.

With AI startups booming, nap pods and Silicon Valley hustle culture are back

OpenAI’s Superalignment team, responsible for developing ways to govern and steer “superintelligent” AI systems, was promised 20% of the company’s compute resources, according to a person from that team. But…

OpenAI created a team to control ‘superintelligent’ AI — then let it wither, source says

A new crop of early-stage startups — along with some recent VC investments — illustrates a niche emerging in the autonomous vehicle technology sector. Unlike the companies bringing robotaxis to…

VCs and the military are fueling self-driving startups that don’t need roads

When the founders of Sagetap, Sahil Khanna and Kevin Hughes, started working at early-stage enterprise software startups, they were surprised to find that the companies they worked at were trying…

Deal Dive: Sagetap looks to bring enterprise software sales into the 21st century

Keeping up with an industry as fast-moving as AI is a tall order. So until an AI can do it for you, here’s a handy roundup of recent stories in the world…

This Week in AI: OpenAI moves away from safety

After Apple loosened its App Store guidelines to permit game emulators, the retro game emulator Delta — an app 10 years in the making — hit the top of the…

Adobe comes after indie game emulator Delta for copying its logo

Meta is once again taking on its competitors by developing a feature that borrows concepts from others — in this case, BeReal and Snapchat. The company is developing a feature…

Meta’s latest experiment borrows from BeReal’s and Snapchat’s core ideas

Welcome to Startups Weekly! We’ve been drowning in AI news this week, with Google’s I/O setting the pace. And Elon Musk rages against the machine.

Startups Weekly: It’s the dawning of the age of AI — plus,  Musk is raging against the machine

IndieBio’s Bay Area incubator is about to debut its 15th cohort of biotech startups. We took special note of a few, which were making some major, bordering on ludicrous, claims…

IndieBio’s SF incubator lineup is making some wild biotech promises

YouTube TV has announced that its multiview feature for watching four streams at once is now available on Android phones and tablets. The Android launch comes two months after YouTube…

YouTube TV’s ‘multiview’ feature is now available on Android phones and tablets

Featured Article

Two Santa Cruz students uncover security bug that could let millions do their laundry for free

CSC ServiceWorks provides laundry machines to thousands of residential homes and universities, but the company ignored requests to fix a security bug.

3 days ago
Two Santa Cruz students uncover security bug that could let millions do their laundry for free

TechCrunch Disrupt 2024 is just around the corner, and the buzz is palpable. But what if we told you there’s a chance for you to not just attend, but also…

Harness the TechCrunch Effect: Host a Side Event at Disrupt 2024

Decks are all about telling a compelling story and Goodcarbon does a good job on that front. But there’s important information missing too.

Pitch Deck Teardown: Goodcarbon’s $5.5M seed deck

Slack is making it difficult for its customers if they want the company to stop using its data for model training.

Slack under attack over sneaky AI training policy

A Texas-based company that provides health insurance and benefit plans disclosed a data breach affecting almost 2.5 million people, some of whom had their Social Security number stolen. WebTPA said…

Healthcare company WebTPA discloses breach affecting 2.5 million people

Featured Article

Microsoft dodges UK antitrust scrutiny over its Mistral AI stake

Microsoft won’t be facing antitrust scrutiny in the U.K. over its recent investment into French AI startup Mistral AI.

3 days ago
Microsoft dodges UK antitrust scrutiny over its Mistral AI stake

Ember has partnered with HSBC in the U.K. so that the bank’s business customers can access Ember’s services from their online accounts.

Embedded finance is still trendy as accounting automation startup Ember partners with HSBC UK

Kudos uses AI to figure out consumer spending habits so it can then provide more personalized financial advice, like maximizing rewards and utilizing credit effectively.

Kudos lands $10M for an AI smart wallet that picks the best credit card for purchases

The EU’s warning comes after Microsoft failed to respond to a legally binding request for information that focused on its generative AI tools.

EU warns Microsoft it could be fined billions over missing GenAI risk info

The prospects for troubled banking-as-a-service startup Synapse have gone from bad to worse this week after a United States Trustee filed an emergency motion on Wednesday.  The trustee is asking…

A US Trustee wants troubled fintech Synapse to be liquidated via Chapter 7 bankruptcy, cites ‘gross mismanagement’

U.K.-based Seraphim Space is spinning up its 13th accelerator program, with nine participating companies working on a range of tech from propulsion to in-space manufacturing and space situational awareness. The…

Seraphim’s latest space accelerator welcomes nine companies

OpenAI has reached a deal with Reddit to use the social news site’s data for training AI models. In a blog post on OpenAI’s press relations site, the company said…

OpenAI inks deal to train AI on Reddit data

X users will now be able to discover posts from new Communities that are trending directly from an Explore tab within the section.

X pushes more users to Communities