The advent of cloud computing came will all sorts of benefits for customers including reduced IT costs, unlimited scalability, and higher resiliency. However, as the number and complexity of cloud deployments within an enterprise have increased some of these benefits have been reduced. Things like shadow IT, expanded services, and hidden costs have led to companies searching for a way to manage their cloud spend. Pileus, a new startup out of Israel aimed at solving this issue, announced its launch yesterday with a $1m seed funding round.
How is Pileus different?
As TechCrunch reports, “Using machine learning, the company’s platform continuously learns about how a user typically uses a given cloud and then provides forecasts and daily personalized recommendations to help them stay within a budget.” Pileus charges customers 1% of their cloud savings. Since it is monitoring all of a customer’s cloud spend the tool can also be used to identify abnormalities in engineering budgets helping reduce shadow IT. The company believes it is differentiated from its competition (ex. Cloudability) due to its machine learning platform and a shorter time to value.
Why this transaction?
The team at York IE wanted to highlight this funding for two reasons. First, it clearly shows that even in industries where there are behemoths with large balance sheets and engineering teams, there can always be opportunity for startups to provide an innovative solution to make them better. In this situation, when Pileus is able to offer its solution for all three of the major cloud platforms (The product is currently only for AWS), it will benefit from the multi-cloud trend and the competitive nature between the three platforms. The second reason may sound more like a question. Pileus believes itself to be differentiated on its machine learning capability and its time to value. Those could both very well be great tech moats. As an investor you’d have to determine how much confidence you have in that.
