When large cloud providers have excess compute capacity, they tend to offload it through programs like AWS and Azure spot snapshots. Any time a server is idle, it ultimately doesn’t make the company any money. NodeShift aims to take this idea and extend it far beyond big clouds — and with stronger guarantees — by providing a single API to access additional compute, storage and graphics accelerators from independent data center operators and through connections to low-cost decentralized web services like Akash and Filecoin.
NodeShift today announced that it has raised a $3.2 million funding round led by Inovo.vc, which focuses on startups based in Central and Eastern Europe, with participation from Notion Capital, 10x Founders and Kestrel0x1. Epic Games also joined as an angel investor.
The company was founded by Andrey Surkov and Mihai Marcuță. They first met when they were interns at Cisco in 2016. While Surkov remained at Cisco (and was also in crypto at one point), Mărcuță went on to work at Microsoft Azure, Twitter, and Epic Games out of London for the next few years. They remained friends, however, and the project took place when they accompanied another friend to Turkey, where he had a hair transplant. While in the recovery room, Surkov shared his idea for a company that would make this excess data center capacity available to developers. How’s that for a founding story?
“A lot of data centers just have excess capacity out there – about 10 to 20% of excess capacity sitting there – and there are hundreds of data centers like this,” Mărcuță explained. “The price is very, very affordable. If you compare it to traditional cloud providers, we’re talking about prices that are 70 to 80% cheaper.”
NodeShift promises that it can save its users over 70% in computing costs compared to major cloud providers. This includes access to Nvidia accelerators such as the ever-in-demand A100 GPUs at a significant discount. And while the big cloud vendors can’t offer it, web3 services also offer access to high-end consumer-grade accelerators like RTX 4090 gaming GPUs, which can be slower but also much more affordable.
Because of his experience with networking at Cisco and decentralized cryptosystems, Surkov had become interested in why there is so much friction in using decentralized computing. “I wanted to figure out how to host my DAP fully decentralized, and then I realized there’s a huge amount of friction. Hosting fully decentralized storage is like one thing. The calculation is another thing — and then you put it all together and subtract the coupon friction. You have to get the token for each of the crypto projects just to fund the infrastructure. It’s a huge amount of friction,” Surkov said.
Indeed, I would guess that it is difficult to convince a CFO to allow a group of developers to buy a random cryptocurrency, even if it is just to experiment with these services. So even though the prices may be great, using these services becomes cumbersome in a business context.
It is worth noting that the founders are very clear about the use of web3 and blockchain technologies. “We personally feel that web3 and blockchains often go into projects where you don’t necessarily need them just to have that,” Mărcuță said.
In addition to these decentralized projects, NodeShift has also entered into agreements with independent data center operators. The team emphasized that developers can choose exactly where their projects will be located (right down to the data center) and that these data centers were certified by the Uptime Institute and have all the standard SOC 2 and ISO 27000 certifications that a corporate user would expect. By using these data centers, the company is also able to offer these customers an SLA — something that would be difficult (or rather expensive) to do in a web3 framework.
What this combination of traditional infrastructure and web3 allows, however, is to explode capacity into these projects when needed and at a low price, turning them into what is essentially a snapshot on NodeShift. Just on the data center side, the company says, it currently has access to about 400,000 CPUs and 28 million terabytes of storage.
Soon, NodeShift will launch a Kubernetes platform that will sit on top of all of this, making it easy to shift workloads as needed.
In addition, the team plans to use the funding to develop its offering, as well as its go-to-market efforts.
Some of the company’s competitors include Germany as its headquarters Impossible Cloudalthough this group only focuses on storage and Saladwhich focuses heavily on AI/ML workloads on consumer-grade hardware.
