Key Points
- Cloudflare started as a free spam-filtering service, then realized it had a bigger mission – to build a better, more private internet.
- The company has built out a proprietary network of serverless architecture, one of its key differentiators.
- Cloudflare believes its three differentiators are its architecture, its go-to-market strategy and the way it has built its team.
- Its next evolution is Cloudflare Workers, which is built on its serverless architecture that makes its edge network programmable.
From humble beginnings as an application to find the source of email spam, web infrastructure and security company Cloudflare has grown into a global cloud platform that protects websites from attacks while optimizing performance. As a cloud provider to businesses large and small, Cloudflare serves around 28 million HTTP requests a second and deals with data in 250 cities in over 100 countries around the world.
Cloudflare started as a free service in order to build its network, and its mission to build a better internet evolved over time. The team recognized that the internet needed to be faster, safer, more reliable and increasingly more private, regardless of whether the customer was an individual or a global company.
“When we started, what we really saw at first was this giant market opportunity, that if you could build a network that had intelligence built into it, and essentially become Cisco as a service, that would be a very big business opportunity. But in the process of realizing that opportunity, I think we realized that our mission is really to help build a better internet.”
Matthew Prince, Co-Founder & CEO, Cloudflare
“How could we make it more secure from the beginning? How can we make it more reliable? How could we make it faster? How could we make it more efficient so that it's accessible to anyone in the world? And I think one of the things that we've realized recently is how can we actually make it more private?” he added.
Commodity hardware, smart software
Today, Cloudflare is in a position to make some of that difference, with a global reach and an architecture that is a unique point of differentiation for the company. Cloudflare has symbiotic partnerships with global colocation facilities local ISPs to allow it to meet the customer wherever they are, while helping ISPs to reduce routing costs and improve customer experiences. Its customers get flexibility and the ability to scale faster and, as a result, around 20% of all global websites currently use Cloudflare. The company’s architecture is based around these ISP partnerships, and simple commodity hardware with smart software on top.
“We buy a very standard SKU of equipment…we buy it at scale, so that we can get very attractive pricing on it,” said Prince. “And then we've deployed a just-in-time capability, where we are actually at a point where we can nearly double the capacity in any one of our critical cities around the world in less than 30 days. That gives us this incredible robustness and flexibility. And then we're completely software defined in terms of how our network works, so that we can spread load across that entire network capacity.”
Computing on the edge
Cloudflare also has a simple go-to-market strategy. It aims to make it easy for any company to sign up, and then get them up and running very quickly. The next stage for its architecture is Workers, that makes Cloudflare’s edge network programmable.
“In its 250 cities, Cloudflare is within 50 milliseconds of people connecting online. We make all of those requests faster, safer, more reliable, we do identity and access, in all those locations around the world. Now imagine if you could start to do compute in those same places,” said Zatlyn.
“Back 15 years ago, you had on-premise data centers, then there's been a lot of cloud computing, but even with cloud computing, you have to pick a region. What if you could put more of that store compute right into the network? Serverless computing is the whole idea for the next wave of the computing platform.”
Michelle Zatlyn, Co-Founder, President & COO, Cloudflare
There are several immediate use cases for Workers, including addressing data leakage and compliance with data residency needs. Workers is already in use with a number of clients, including a large distributor of videogame consoles, which used it to manage traffic during the holiday season without website crashes and has tested the technology at 100K transactions a second.
The company also works with cryptocurrency exchanges, ensuring secure operations, as they are a prime target for cybercriminals. The management team said that helping these exchanges also helps Cloudflare to learn about and deal with more sophisticated cybersecurity challenges before they move on to attacking traditional enterprises.
Building the best team
Despite the ongoing talent gap, Cloudflare has had around 250K job applications over the last year, of which only about 0.5% were accepted. According to Prince, the most talented engineers want to come work for Cloudflare, because they see that the real secret to building great companies is getting great people.
“I think that is really the ultimate secret to our success. And I'm incredibly honored by all the people who have chosen to spend their careers with us,” he says.
That high success rate in attracting talent may also be partly due to its ESG considerations, which include promoting diversity, environmental sustainability and equitable access to internet.
“If you look at all the culture surveys we do internally, people say they feel like they really belong at Cloudflare. They feel like there's a space for them here, both women and men, and underrepresented minorities. And that is something we're proud of,” says Zatlyn.
Being a company that takes care of employee wellbeing is hugely important to Cloudflare, along with giving back to communities. For example, Cloudflare helps to bring internet access to difficult regions because the company believes that better internet access helps deliver better education and enable businesses to solve problems in their communities.
"We're constantly looking at the different United Nations goals for sustainability and asking how we can help to further these. To be great members in our community while delivering great ROI to our shareholders, to be a great place to work, and also help our customers."
This content is based on a keynote session from RBC Capital Markets’ Global Technology, Internet, Media and Telecommunications (TIMT) virtual conference, which was held on November 16-17, 2021. For more information about the conference, please contact your RBC representative.
