Apr
14
2021
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Upstack raises $50M for its platform and advisory to help businesses plan and buy for digital transformation

Digital transformation has been one of the biggest catchphrases of the past year, with many an organization forced to reckon with aging IT, a lack of digital strategy, or simply the challenges of growth after being faced with newly-remote workforces, customers doing everything online and other tech demands.

Now, a startup called Upstack that has built a platform to help those businesses evaluate how to grapple with those next steps — including planning and costing out different options and scenarios, and then ultimately buying solutions — is announcing financing to do some growth of its own.

The New York startup has picked up funding of $50 million, money that it will be using to continue building out its platform and expanding its services business.

The funding is coming from Berkshire Partners, and it’s being described as an “initial investment”. The firm, which makes private equity and late-stage growth investments, typically puts between $100 million and $1 billion in its portfolio companies so this could end up as a bigger number, especially when you consider the size of the market that Upstack is tackling: the cloud and internet infrastructure brokerage industry generates annual revenues “in excess of $70 billion,” the company estimates.

We’re asking about the valuation, but PitchBook notes that the median valuation in its deals is around $211 million. Upstack had previously raised around $35 million.

Upstack today already provides tools to large enterprises, government organizations, and smaller businesses to compare offerings and plan out pricing for different scenarios covering a range of IT areas, including private, public and hybrid cloud deployments; data center investments; network connectivity; business continuity and mobile services, and the plan is to bring in more categories to the mix, including unified communications and security.

Notably, Upstack itself is profitable and names a lot of customers that themselves are tech companies — they include Cisco, Accenture, cloud storage company Backblaze, Riverbed and Lumen — a mark of how digital transformation and planning for it are not necessarily a core competency even of digital businesses, but especially those that are not technology companies. It says it has helped complete over 3,700 IT projects across 1,000 engagements to date.

“Upstack was founded to bring enterprise-grade advisory services to businesses of all sizes,” said Christopher Trapp, founder and CEO, in a statement. “Berkshire’s expertise in the data center, connectivity and managed services sectors aligns well with our commitment to enabling and empowering a world-class ecosystem of technology solutions advisors with a platform that delivers higher value to their customers.”

The core of the Upstack’s proposition is a platform that system integrators, or advisors, plus end users themselves, can use to design and compare pricing for different services and solutions. This is an unsung but critical aspect of the ecosystem: We love to hear and write about all the interesting enterprise technology that is being developed, but the truth of the matter is that buying and using that tech is never just a simple click on a “buy” button.

Even for smaller organizations, buying tech can be a hugely time-consuming task. It involves evaluating different companies and what they have to offer — which can differ widely in the same category, and gets more complex when you start to compare different technological approaches to the same problem.

It also includes the task of designing solutions to fit one’s particular network. And finally, there are the calculations that need to be made to determine the real cost of services once implemented in an organization. It also gives users the ability to present their work, which also forms a critical part of the evaluating and decision-making process. When you think about all of this, it’s no wonder that so many organizations have opted to follow the “if it ain’t broke, don’t fix it” school of digital strategy.

As technology has evolved, the concept of digital transformation itself has become more complicated, making tools like Upstack’s more in demand both by companies and the people they hire to do this work for them. Upstack also employs a group of about 15 advisors — consultants — who also provide insight and guidance in the procurement process, and it seems some of the funding will also be used to invest in expanding that team.

(Incidentally, the model of balancing technology with human experts is one used by other enterprise startups that are built around the premise of helping businesses procure technology: BlueVoyant, a security startup that has built a platform to help businesses manage and use different security services, also retains advisors who are experts in that field.)

The advisors are part of the business model: Upstack’s customers can either pay Upstack a consulting fee to work with its advisors, or Upstack receives a commission from suppliers that a company ends up using, having evaluated and selected them via the Upstack platform.

The company competes with traditional systems integrators and consultants, but it seems that the fact that it has built a tech platform that some of its competitors also use is one reason why it’s caught the eye of investors, and also seen strong growth.

Indeed, when you consider the breadth of services that a company might use within their infrastructure — whether it’s software to run sales or marketing, or AI to run a recommendation for products on a site, or business intelligence or RPA — it will be interesting to see how and if Upstack considers deeper moves into these areas.

“Upstack has quickly become a leader in a large, rapidly growing and highly fragmented market,” said Josh Johnson, principal at Berkshire Partners, in a statement. “Our experience has reinforced the importance of the agent channel to enterprises designing and procuring digital infrastructure. Upstack’s platform accelerates this digital transformation by helping its advisors better serve their enterprise customers. We look forward to supporting Upstack’s continued growth through M&A and further investment in the platform.”

Feb
17
2021
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Microsoft’s Dapr open-source project to help developers build cloud-native apps hits 1.0

Dapr, the Microsoft-incubated open-source project that aims to make it easier for developers to build event-driven, distributed cloud-native applications, hit its 1.0 milestone today, signifying the project’s readiness for production use cases. Microsoft launched the Distributed Application Runtime (that’s what “Dapr” stand for) back in October 2019. Since then, the project released 14 updates and the community launched integrations with virtually all major cloud providers, including Azure, AWS, Alibaba and Google Cloud.

The goal for Dapr, Microsoft Azure CTO Mark Russinovich told me, was to democratize cloud-native development for enterprise developers.

“When we go look at what enterprise developers are being asked to do — they’ve traditionally been doing client, server, web plus database-type applications,” he noted. “But now, we’re asking them to containerize and to create microservices that scale out and have no-downtime updates — and they’ve got to integrate with all these cloud services. And many enterprises are, on top of that, asking them to make apps that are portable across on-premises environments as well as cloud environments or even be able to move between clouds. So just tons of complexity has been thrown at them that’s not specific to or not relevant to the business problems they’re trying to solve.”

And a lot of the development involves re-inventing the wheel to make their applications reliably talk to various other services. The idea behind Dapr is to give developers a single runtime that, out of the box, provides the tools that developers need to build event-driven microservices. Among other things, Dapr provides various building blocks for things like service-to-service communications, state management, pub/sub and secrets management.

Image Credits: Dapr

“The goal with Dapr was: let’s take care of all of the mundane work of writing one of these cloud-native distributed, highly available, scalable, secure cloud services, away from the developers so they can focus on their code. And actually, we took lessons from serverless, from Functions-as-a-Service where with, for example Azure Functions, it’s event-driven, they focus on their business logic and then things like the bindings that come with Azure Functions take care of connecting with other services,” Russinovich said.

He also noted that another goal here was to do away with language-specific models and to create a programming model that can be leveraged from any language. Enterprises, after all, tend to use multiple languages in their existing code, and a lot of them are now looking at how to best modernize their existing applications — without throwing out all of their current code.

As Russinovich noted, the project now has more than 700 contributors outside of Microsoft (though the core commuters are largely from Microsoft) and a number of businesses started using it in production before the 1.0 release. One of the larger cloud providers that is already using it is Alibaba. “Alibaba Cloud has really fallen in love with Dapr and is leveraging it heavily,” he said. Other organizations that have contributed to Dapr include HashiCorp and early users like ZEISS, Ignition Group and New Relic.

And while it may seem a bit odd for a cloud provider to be happy that its competitors are using its innovations already, Russinovich noted that this was exactly the plan and that the team hopes to bring Dapr into a foundation soon.

“We’ve been on a path to open governance for several months and the goal is to get this into a foundation. […] The goal is opening this up. It’s not a Microsoft thing. It’s an industry thing,” he said — but he wasn’t quite ready to say to which foundation the team is talking.

 

Dec
01
2020
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AWS updates its edge computing solutions with new hardware and Local Zones

AWS today closed out its first re:Invent keynote with a focus on edge computing. The company launched two smaller appliances for its Outpost service, which originally brought AWS as a managed service and appliance right into its customers’ existing data centers in the form of a large rack. Now, the company is launching these smaller versions so that its users can also deploy them in their stores or office locations. These appliances are fully managed by AWS and offer 64 cores of compute, 128GB of memory and 4TB of local NVMe storage.

In addition, the company expanded its set of Local Zones, which are basically small extensions of existing AWS regions that are more expensive to use but offer low-latency access in metro areas. This service launched in Los Angeles in 2019 and starting today, it’s also available in preview in Boston, Houston and Miami. Soon, it’ll expand to Atlanta, Chicago, Dallas, Denver, Kansas City, Las Vegas, Minneapolis, New York, Philadelphia, Phoenix, Portland and Seattle. Google, it’s worth noting, is doing something similar with its Mobile Edge Cloud.

The general idea here — and that’s not dissimilar from what Google, Microsoft and others are now doing — is to bring AWS to the edge and to do so in a variety of form factors.

As AWS CEO Andy Jassy rightly noted, AWS always believed that the vast majority of companies, “in the fullness of time” (Jassy’s favorite phrase from this keynote), would move to the cloud. Because of this, AWS focused on cloud services over hybrid capabilities early on. He argues that AWS watched others try and fail in building their hybrid offerings, in large parts because what customers really wanted was to use the same control plane on all edge nodes and in the cloud. None of the existing solutions from other vendors, Jassy argues, got any traction (though AWSs competitors would surely deny this) because of this.

The first result of that was VMware Cloud on AWS, which allowed customers to use the same VMware software and tools on AWS they were already familiar with. But at the end of the day, that was really about moving on-premises services to the cloud.

With Outpost, AWS launched a fully managed edge solution that can run AWS infrastructure in its customers’ data centers. It’s been an interesting journey for AWS, but the fact that the company closed out its keynote with this focus on hybrid — no matter how it wants to define it — shows that it now understands that there is clearly a need for this kind of service. The AWS way is to extend AWS into the edge — and I think most of its competitors will agree with that. Microsoft tried this early on with Azure Stack and really didn’t get a lot of traction, as far as I’m aware, but it has since retooled its efforts around Azure Arc. Google, meanwhile, is betting big on Anthos.

Jun
22
2020
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HashiCorp to offer managed versions of its developer tools starting with Consul

HashiCorp is well known in the developer community for offering a slew of open-source tools to help build and manage modern applications. Today the company announced a new cloud platform and plans to eventually offer managed versions of those tools, starting with Consul, a tool for connecting and securing services across platforms.

HashiCorp CEO Dave McJannet says that the pandemic has accelerated demand for cloud infrastructure, and he sees a growing role for his company in helping to build cloud native applications. The company offers open-source and commercial versions of several popular tools, including Terraform, Consul, Vault and Packer, among others. These can run on premises or in the cloud, but McJannet says customers have been hankering for SaaS versions of these tools.

“Our customers have told us that it’s a huge challenge running a central shared service like Consul. It requires them to keep it up and running, and they have asked for something they can consume from us where we manage it for them,” McJannet told TechCrunch.

The company has been offering a managed version of Terraform for some time, but it has been quietly working on a cloud platform that could allow it to plug in each of the company’s products over time and offer managed services of all the products.

“What we are announcing today is what we call the HashiCorp Cloud Platform, and you can think of it as just a common chassis to allow us to run our products on any cloud. The first of those products that we’re making available is Consul on Amazon,” he said.

By offering the company’s products as a set of cloud services, it will lower the barrier to entry for customers who want to use their tooling, but don’t have the resources to run and manage on their own. That could potentially increase the company revenue over time. As McJannet pointed out, it’s a lot like what MongDB did with its managed Atlas database service, but for a wider set of products.

Last Fall, HashiCorp announced a $175 million investment on an impressive $5 billion valuation. It has 1,000 employees and is continuing to hire as demand for its product continues through the pandemic. McJannet was not discussing specific customer numbers, but said the customer count has doubled over the last year. As it builds out the new cloud services, and introduces more customers to its products, there’s a good chance that number will keep growing.

May
20
2020
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BetterCloud scores $75M Series F as SaaS management needs grow

BetterCloud gives IT visibility into its SaaS tools providing the means to discover, manage and secure those tools. In the middle of a crisis that has forced most companies to move workers home, being able to manage SaaS usage in this way is growing increasingly significant.

Today the company announced a $75 million Series F. Warburg Pincus led the way with participation from existing investors Bain Capital Ventures, Accel, Greycroft Partners, Flybridge Capital Partners, New Amsterdam Growth Capital and e.ventures. Today’s round brings the total raised to $187 million, according to the company.

While CEO David Politis acknowledges the gravity of the current situation, he also recognizes that giving companies a way to manage their SaaS usage is more pertinent than ever. “What has happened in the last two months has been terrible for the world, but in some crazy way it has just made what we do a lot more relevant,” Politis told TechCrunch .

He says the pandemic has really accelerated the market opportunity because of the reliance on cloud services and the services his company provides.

Those services began as an operational layer on top of G Suite. Later it added support for Office 365 and in 2016 it moved to more general SaaS management. It now offers direct integrations into multiple SaaS apps including Box, Dropbox, Salesforce, Zendesk and more. The set of tools in Bettercloud gives IT control over security, configuration, spend optimization and auditability across SaaS applications.

In normal times after a large Series F round, we might be talking about this being the last round before an IPO, but Politis isn’t ready to commit to that just yet, especially in this economy. He does say, however, that he’s in it for the long haul and sees an opportunity to build a long-term, sustainable company.

“The last couple of months I’ve been thinking about this a lot, and when you take a $75 million round at the stage you’re not doing that because you want to sell the business. You’re doing that because you want to build something and build something really special,” he said.

May
07
2020
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Dtex, a specialist in insider threat cybersecurity, raises $17.5M

A lot of enterprise cybersecurity efforts focus on malicious hackers that work on behalf of larger organizations, be they criminal groups or state actors — and for good reason, since the majority of incidents these days come from phishing and other malicious techniques that originate outside the enterprise itself.

But there has also been a persistent, and now growing, focus also on “insider threats” — that is, breaches that start from within organizations themselves. And today a startup that specialises in this area is announcing a round of growth funding to expand its reach.

Dtex, which uses machine learning to monitor network activity within the perimeter and around all endpoints to detect unusual patterns or behaviour around passwords, data movement and other network activities, is today announcing that it has raised $17.5 million in funding.

The round is being led by new investor Northgate Capital with Norwest Venture Partners and Four Rivers Group, both previous investors, also participating. Prior to this, the San Jose-based startup had raised $57.5 million, according to data from PitchBook, while CrunchBase puts the total raised at $40 million.

CEO Bahman Mahbod said the startup is not disclosing valuation except to say that it’s “very excited” about it.

For some context, the company works with hundreds of large enterprises, primarily in the financial, critical infrastructure, government and defence sectors. The plan is to now extend further into newer verticals where it’s started to see more activity more recently: pharmaceuticals, life sciences and manufacturing. Dtex says that over the past 12 months, 80% of its top customers have been increasing their level of engagement with the startup.

Dtex’s focus on “insider” threats sounds slightly sinister at first. Is the implication here that people are more dishonest and nefarious these days and thus need to be policed and monitored much more closely for wrongdoing? The answer is no. There are no more dishonest people today than there ever have been, but there are a lot more opportunities to make mistakes that result in security breaches.

The working world has been on a long-term trend of becoming increasingly digitised in all of its interactions, and bringing on a lot more devices onto those networks. Across both “knowledge” and front-line workers, we now have a vastly larger number of devices being used to help workers do their jobs or just keep in touch with the company as they work, with many of them being brought by the workers themselves rather than being provisioned by the companies. There has also been a huge increase in cloud services,

And in the realm of “knowledge” workers, we’re seeing a lot more remote or peripatetic working, where people don’t have fixed desks and often work outside the office altogether — something that has skyrocketed in recent times with stay-at-home orders put in place to mitigate the spread of COVID-19 cases.

All of this translates into a much wider threat “horizon” within organizations themselves, before even considering the sophistication of external malicious hackers.

And the current state of business has exacerbated that. Mahbod tells us that Dtex is currently seeing spikes in unusual activity from the rise in home workers, who sometimes circumvent VPNs and other security controls, thus committing policy violations; as well as more problems arising from the fact that home networks have been compromised and that is leaving work networks, accessed from home, more vulnerable. These started, he said, with COVID-19 phishing attacks but have progressed to undetected malware from drive-by downloads.

And, inevitably, he added that there has been a rise in intentional data theft and accidental loss arising in cases where organizations have had to lay people off or run a round of furloughs, but might still result from negligence rather than intentional actions.

There are a number of other cybersecurity companies that provide ways to detect insider threats — they include CloudKnox and Obsidian Security, along with a number of larger and established vendors. But Mabhod says that Dtex “is the only company with ‘next-generation’ capabilities that are cloud-first, AI/ML baked-in, and enterprise scalable to millions of users and devices, which it sells as DMAP+.

“Effectively, Next-Gen Insider Threat solutions must replace legacy Insider Threat point solutions which were borne out of the UAM, DLP and UEBA spaces,” he said.

Those providing legacy approaches of that kind include Forcepoint with its SureView product and Proofpoint with its ObserveIT product. Interestingly, CyberX, which is currently in the process of getting acquired by Microsoft (according to reports and also our sources), also includes insider threats in its services.

This is one reason why investors have been interested.

“Dtex has built a highly scalable platform that utilizes a cloud-first, lightweight endpoint architecture, offering clients a number of use cases including insider threat prevention and business operations intelligence,” said Thorsten Claus, partner, Northgate Capital, in a statement. Northgate has a long list of enterprise startups in its portfolio that represent potential customers but also a track record of experience in assessing the problem at hand and building products to address it. “With Dtex, we have found a fast-growing, long-term, investible operation that is not just a band-aid collection of tools, which would be short-lived and replaced.”

Feb
19
2020
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Google Cloud opens its Seoul region

Google Cloud today announced that its new Seoul region, its first in Korea, is now open for business. The region, which it first talked about last April, will feature three availability zones and support for virtually all of Google Cloud’s standard service, ranging from Compute Engine to BigQuery, Bigtable and Cloud Spanner.

With this, Google Cloud now has a presence in 16 countries and offers 21 regions with a total of 64 zones. The Seoul region (with the memorable name of asia-northeast3) will complement Google’s other regions in the area, including two in Japan, as well as regions in Hong Kong and Taiwan, but the obvious focus here is on serving Korean companies with low-latency access to its cloud services.

“As South Korea’s largest gaming company, we’re partnering with Google Cloud for game development, infrastructure management, and to infuse our operations with business intelligence,” said Chang-Whan Sul, the CTO of Netmarble. “Google Cloud’s region in Seoul reinforces its commitment to the region and we welcome the opportunities this initiative offers our business.”

Over the course of this year, Google Cloud also plans to open more zones and regions in Salt Lake City, Las Vegas and Jakarta, Indonesia.

Oct
30
2019
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Google launches TensorFlow Enterprise with long-term support and managed services

Google open-sourced its TensorFlow machine learning framework back in 2015 and it quickly became one of the most popular platforms of its kind. Enterprises that wanted to use it, however, had to either work with third parties or do it themselves. To help these companies — and capture some of this lucrative market itself — Google is launching TensorFlow Enterprise, which includes hands-on, enterprise-grade support and optimized managed services on Google Cloud.

One of the most important features of TensorFlow Enterprise is that it will offer long-term support. For some versions of the framework, Google will offer patches for up to three years. For what looks to be an additional fee, Google will also offer to companies that are building AI models engineering assistance from its Google Cloud and TensorFlow teams.

All of this, of course, is deeply integrated with Google’s own cloud services. “Because Google created and open-sourced TensorFlow, Google Cloud is uniquely positioned to offer support and insights directly from the TensorFlow team itself,” the company writes in today’s announcement. “Combined with our deep expertise in AI and machine learning, this makes TensorFlow Enterprise the best way to run TensorFlow.”

Google also includes Deep Learning VMs and Deep Learning Containers to make getting started with TensorFlow easier, and the company has optimized the enterprise version for Nvidia GPUs and Google’s own Cloud TPUs.

Today’s launch is yet another example of Google Cloud’s focus on enterprises, a move the company accelerated when it hired Thomas Kurian to run the Cloud businesses. After years of mostly ignoring the enterprise, the company is now clearly looking at what enterprises are struggling with and how it can adapt its products for them.

Sep
29
2019
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Why is Dropbox reinventing itself?

According to Dropbox CEO Drew Houston, 80% of the product’s users rely on it, at least partially, for work.

It makes sense, then, that the company is refocusing to try and cement its spot in the workplace; to shed its image as “just” a file storage company (in a time when just about every big company has its own cloud storage offering) and evolve into something more immutably core to daily operations.

Earlier this week, Dropbox announced that the “new Dropbox” would be rolling out to all users. It takes the simple, shared folders that Dropbox is known for and turns them into what the company calls “Spaces” — little mini collaboration hubs for your team, complete with comment streams, AI for highlighting files you might need mid-meeting, and integrations into things like Slack, Trello and G Suite. With an overhauled interface that brings much of Dropbox’s functionality out of the OS and into its own dedicated app, it’s by far the biggest user-facing change the product has seen since launching 12 years ago.

Shortly after the announcement, I sat down with Dropbox VP of Product Adam Nash and CTO Quentin Clark . We chatted about why the company is changing things up, why they’re building this on top of the existing Dropbox product, and the things they know they just can’t change.

You can find these interviews below, edited for brevity and clarity.

Greg Kumparak: Can you explain the new focus a bit?

Adam Nash: Sure! I think you know this already, but I run products and growth, so I’m gonna have a bit of a product bias to this whole thing. But Dropbox… one of its differentiating characteristics is really that when we built this utility, this “magic folder”, it kind of went everywhere.

Sep
05
2019
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Atlassian launches free tiers for all its cloud products, extends premium pricing plan

At our TC Sessions: Enterprise event, Atlassian co-CEO Scott Farquhar today announced a number of updates to how the company will sell its cloud-based services. These include the launch of new premium plans for more of its products, as well as the addition of a free tier for all of the company’s services that didn’t already offer one. Atlassian now also offers discounted cloud pricing for academic institutions and nonprofit organizations.

The company previously announced its premium plans for Jira Software Cloud and Confluence Cloud. Now, it is adding Jira Service Desk to this lineup, and chances are it’ll add more of its services over time. The premium plan adds a 99.9% update SLA, unlimited storage and additional support. Until now, Atlassian sold these products solely based on the number of users, but didn’t offer a specific enterprise plan.

As Harsh Jawharkar, the head of go-to-market for Cloud Platform at Atlassian, told me, many of its larger customers, who often ran the company’s products on their own servers before, are now looking to move to the cloud and hand over to Atlassian the day-to-day operations of these services. That’s in part because they are more comfortable with the idea of moving to the cloud at this point — and because Atlassian probably knows how to run its own services better than anybody else. 

For these companies, Atlassian is also introducing a number of new features today. Those include soon-to-launch data residency controls for companies that need to ensure that their data stays in a certain geographic region, as well as the ability to run Jira and Confluence Cloud behind customized URLs that align with a company’s brand, which will launch in early access in 2020. Maybe more important, though, are features to Atlassian Access, the company’s command center that helps enterprises manage its cloud products. Access now supports single sign-on with Google Cloud Identity and Microsoft Active Directory Federation Services, for example. The company is also partnering with McAfee and Bitglass to offer additional advanced security features and launch a cross-product audit log. Enterprise admins will also soon get access to a new dashboard that will help them understand how Atlassian’s tools are being used across the organization.

But that’s not all. The company is also launching new tools to make customer migration to its cloud products easier, with initial support for Confluence and Jira support coming later this year. There’s also new extended cloud trial licenses, which a lot of customers have asked for, Jawharkar told me, because the relatively short trial periods the company previously offered weren’t quite long enough for companies to fully understand their needs.

This is a big slew of updates for Atlassian — maybe its biggest enterprise-centric release since the company’s launch. It has clearly reached a point where it had to start offering these enterprise features if it wanted to grow its market and bring more of these large companies on board. In its early days, Atlassian mostly grew by selling directly to teams within a company. These days, it has to focus a bit more on selling to executives as it tries to bring more enterprises on board — and those companies have very specific needs that the company didn’t have to address before. Today’s launches clearly show that it is now doing so — at least for its cloud-based products.

The company isn’t forgetting about other users either, though. It’ll still offer entry-level plans for smaller teams and it’s now adding free tiers to products like Jira Software, Confluence, Jira Service Desk and Jira Core. They’ll join Trello, Bitbucket and Opsgenie, which already feature free versions. Going forward, academic institutions will receive 50% off their cloud subscriptions and nonprofits will receive 75% off.

It’s obvious that Atlassian is putting a lot of emphasis on its cloud services. It’s not doing away with its self-hosted products anytime, but its focus is clearly elsewhere. The company itself started this process a few years ago and a lot of this work is now coming to fruition. As Anu Bharadwaj, the head of Cloud Platform at Atlassian, told me, this move to a fully cloud-native stack enabled many of today’s announcements, and she expects that it’ll bring a lot of new customers to its cloud-based services.  

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