Cloud vs. on-prem? Oxide seeks to offer the best of both worlds

San Francisco-based Oxide, a startup founded by computing experts from Joyent and Dell, today launched what it calls the world’s first “commercial cloud computer,” a rack-scale system that enterprises can own to reap the benefits and flexibility of cloud computing on-premises, right within their data center.

The company believes the new offering can finally put an end to the “cloud vs on-prem” dilemma enterprises face while up their infrastructure. It also announced $44 million in a series A round of funding, led by Eclipse VC with participation from Intel Capital, Riot Ventures, Counterpart Ventures and Rally Ventures. Oxide plans to use this money to accelerate the adoption of its cloud computer, giving teams a new, better option to serve their customers.

“Oxide addresses the most urgent needs of stakeholders in enterprise IT,” Andy Fligel, senior managing director at Intel Capital, said in a statement. “They have eliminated the trade-off between cloud and on-premises so enterprises can achieve cloud performance across every aspect of their business. Oxide makes it possible to ‘own the cloud’ instead of renting it—a concept that could shift the economics of cloud computing.”

Bridging the gap in computing with Oxide

For years, enterprises have had to weigh between cloud or on-premise computing while deciding where to store and process their data.

The former, rented by providers such as Amazon and Google, gives the benefits of faster deployment with easy maintenance and scalability.

Meanwhile, the latter, driven by a company’s own hardware infrastructure, offers more control, security and reduced latency but at the cost of handling everything, right from investing upfront and setting up the servers by cobbling together a set of disjointed hardware and software components from different vendors to maintaining and upgrading them. 

To bridge this gap and bring the experience of the cloud to an on-prem environment, Steve Tuck and Bryan Cantrill, computing industry veterans who previously led cloud infra efforts at Dell, Sun Microsystems and Joyent, assembled a team of 60 technologists in 2019 and set out to build a unified cloud computer with hardware and software designed together. After four years of work on every aspect of the stack, from printed circuit board design to REST APIs and everything in between, the system is finally ready.

“Our Cloud Computer combines networking, compute and storage capabilities into a single, plug-and-play box. Its rack-scale design improves per-watt density by as much as 70% and energy efficiency by as much as 35% over traditional rack and stack servers, and it ships complete with all the hardware and software required to build, run, and operate true cloud infrastructure. Customers go from rack install to developer availability in hours, compared to weeks or months,” Tuck told VentureBeat. 

The plug-and-play box has 32 sleds, each with an AMD CPU, DRAM and storage pooled together. Users can install them in about four hours and expand capacity by simply ordering and snapping in additional sleds. 

Meanwhile, the software bundled with the box accelerates developer velocity and maximizes operator control. Tuck says it gives developers instant, self-service access to the tools they know while ensuring operators have full control over things like capacity, health and utilization of the computers installed. In a nutshell, the box gives computing infrastructure that is easily deployed, managed and scaled (like a cloud), with granular control and security benefits (of an on-prem environment).

It also takes less physical space than traditional on-prem hardware, Tuck added.

A growing waitlist of customers

Since the cloud computer has just been launched in the market, Oxide doesn’t have a massive customer base. It currently works with a U.S. federal agency as well as a well-known financial services organization but says any medium to large enterprise that relies on cloud and on-premises data centers can reap significant economic and operational benefits from the technology.

“The $44M Series A will help us accelerate the production of cloud computers for Fortune 1000 enterprises. We also have a growing waitlist of customers ready to install once production catches up with demand. While Oxide can’t disclose what specifically is in the pipeline, our team will definitely be continuing to innovate on both software and hardware to deliver the best possible product for enterprise computing,” Tuck noted.

The round brings Oxide’s total financing raised to date to $78 million. The co-founder and CEO refused to share the post-money valuation.