It wasn’t supposed to be like this. Fastly, having started in 2011 is approaching $3B in valuation. Cloudflare, likely to IPO next month is going to be valued anywhere from $3B to $9B, the higher number is for those who believe they will reach a Crowdstrike or Zscaler-like valuation. Instart should have been going IPO right about now for a multi-billion dollar valuation. They were the innovation leader at one point of the CDN-trifecta that included Fastly and Cloudflare. Instart started one year after Cloudflare and one year before Fastly. Somewhere along the way something big happened. Btw, Cloudflare and Fastly have pivoted away from being a CDN into cloud security and edge computing. Â
What did happen to Instart? They’d definitely be a great case study for the industry. Fastly and Cloudflare pivoted beautifully away from the CDN model at the perfect time. And it wasn’t a cosmetic pivot but a monumental pivot. They were seeing the industry change right before their eyes and acted. Call it flawless execution.
There are many reasons why Instart is where they are. The first being, the technology industry changed incredibly fast and they were unable to adopt. Next, they didn’t invest enough in building out their features, like Cloudflare and Fastly. Cloudflare and Fastly love to build features inhouse. And their mishaps and accomplishments in working with open source projects are open for the world to see. Simply go to their blog and everything is there.Â
Next, Instart struggled to identify its target market properly. Initially, they tried to go after the Akamai market, but Akamai is the only one that can do their market (Fortune 1000 and large enterprise). Instart doesn’t have the staff to place dozens of engineers onsight for 100 enterprises if required. Akamai does. And Cloudflare is dominant in the SMB market, having more than 70k paying customers. No other competitor comes close to that. Fastly is in the mid-market, thus, they are sandwiched beautifully between Akamai and Cloudflare. We can go on but that’s it for now.   Â
The good news, Instart is pivoting into a cloud security platform. They have just launched an application access product, making them the 3rd player in the industry to do so, the other two being Akamai and Cloudflare. And they are focused on becoming the next Crowdstrike and/or Zscaler that runs on a CDN. The new management team in place is solid, so there might be some life yet within Instart. Now if they can come back to the innovation product forefront and go IPO in the near future, that would be the most impressive comeback in history.Â
Background
- Company: Instart
- HQ: Palo Alto
- Founded: 2010
- Raised: $140M
- # of Employees: 160
- CEO: Sumit DhawanÂ
- Products: Cloud SecurityÂ
- Clients: Office Depot, Neiman Marcus, Edmunds …..