Today, RunPod, one of the most ambitious AI cloud startups, announced that they’ve hit a head-turning milestone. Initially established by corporate developers Lu & Singh, it currently boasts $120 million in recurring revenue (ARR). The startup’s journey took an unexpected turn when a Reddit post sparked their fire. Little did they know that post would turn their hobby into an extremely successful business. RunPod wants to be the muscle-memory backbone for tomorrow’s software developers. Since the launch, it has massively scaled and now provides AI hosting services across 31 worldwide regions.
Lu and Singh, who once both worked at Comcast, repurposed their mining rigs into AI servers. They all immersed themselves first-hand into cutting-edge machine learning projects. Even with their highly technical expertise, Lu found it difficult when it came time to pitch their novel idea to investors. They further went out on a limb by persuading their spouses to let them invest $50,000 of family money into their business.
“So I’m like, all right, let’s just post on Reddit.” – Lu
In isolation, this Reddit post may not seem noteworthy, but it captured the attention of the tech community, resulting in partnerships and investments that proved invaluable. By 2021, RunPod provided just a handful of integrations. It included built-in support for the tools used to create today’s popular web apps, such as Jupyter notebooks. Everything really turned around for them once they locked down a $20 million seed deal. This agreement was co-led by the venture-capital arms of Dell and Intel.
Key figures like Nat Friedman and Hugging Face co-founder Julien Chaumond joined as investors, the latter reaching out after using RunPod’s product and recognizing its potential. This new wave of support enabled RunPod to more than double the classes it offered, making a big splash.
Less than nine months after launching, Lu and Singh left their corporate jobs and toasted the milestone of hitting $1 million in revenue. Their strategic decision to launch AI hosting for developers two years before the widespread adoption of AI applications positioned them as pioneers in the industry.
“It was almost two years where we really didn’t have any funding.” – Lu
Today RunPod provides its services to 500,000 developers from one man shows to Fortune 500 enterprises with multimillion dollar annual spend. Customers range from well-known integration partners such as Replit, Cursor, OpenAI, Perplexity, Wix and Zillow. Their fast expansion is a testament to the growing need for effective, cloud-native AI-powered solutions.
To start, Lu and Singh were installing rigs of custom computers in their New Jersey basements to mine Ethereum. These developers soon realized the lack of support in the software stack for developing applications against GPUs.
“If we don’t have the GPUs, the market sentiment, the user sentiment changes. Because when they don’t see capacity from you, they go somewhere else.” – Singh
It’s their dedication to innovating this experience that has fueled RunPod’s upward trajectory. Now, they want to be the platform that this next generation of software developers are raised on.
“We were seeing how really god-awful the software stack was for dealing with these GPUs,” – Lu
Their commitment to improving this experience has driven RunPod’s continuous evolution. Today, they aim to be what this next generation of software developers grows up on.
“Our goal is to be what this next generation of software developers grows up on.” – Lu