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Interesting business model. You're essentially loaning companies money for the RIs, right? So if all your customers sold them back to you you'd be in trouble,
by jedberg 5y ago
Interesting business model. You're essentially loaning companies money for the RIs, right? So if all your customers sold them back to you you'd be in trouble, like a loan company?
Either way, an interesting idea. Since you're fronting the money for the RIs, I assume you have a max spend that you won't go over (like, you won't take Netflix as a customer)?
- kavehkhorram 5y agoActually we aren't loaning any money since we use no-upfront RIs only. We have some customers that spend $10M+ on AWS, so we can work with any size of company.
- jedberg 5y agoRight but if someone sells you back their RIs, aren't you on the hook for paying for them if you can't resell them? So that's like a loan.
- kavehkhorram 5y agoIf we can't find a buyer then yes, we buy them back until we find a buyer. To limit this risk, we only offer buy-back on particular instance families and regions that are most popular (and easy for us to sell to other users). With 100s of users -- we have network effects that make it easy for us to sell.
- oh_sigh 5y agoDo you have any interesting problems lined up that you would consider solving if you found yourself with a bunch of reserved instances that you're unable to sell?
- kavehkhorram 5y agoNot at the moment. Any suggestions? :-)
- fhk 5y agoUse the compute to solve your own allocation problems using mathematical optimization.
- delusional 5y agoIt's closer to a leasing arrangement than a loan. They buy the RI with a traditional loan, then finance that by leasing it out at a higher price.