WarpStream Labs Raises USD $20M to Modernise Data Streaming with a Cloud Native Replacement for Apache Kafka

WarpStream Labs, the cloud native data streaming infrastructure company, announced it raised $20M in funding led by Greylock and Amplify Partners. Angel investors in the round include Ben Sigelman (CEO of Lightstep), Spencer Kimball (CEO of CockroachDB), and Barry McCardel (CEO of Hex Technologies). The company will use the funds to hire more engineers, scale their go to market team, and invest in new product lines.

Data streaming is becoming increasingly important as organizations seek to leverage real time data capabilities to gain competitive advantage. Yet almost all modern data streaming stacks are built on-top of Apache Kafka, which was designed in 2011 to run in static data centers. This makes it extremely expensive and difficult to operate in modern cloud environments.

While working at DataDog, WarpStream’s founders Richie and Ryan built Husky, a columnar database purpose-built for observability data that ran directly on top of object storage. Husky replaced an existing system that was designed with traditional data centers in mind with a more modern, cloud native architecture that dramatically reduced costs and operational burden.

“With Husky, we set out to solve Datadog’s storage problem by making it cost-effective and easy to operate. But we realized that Husky only addressed part of the problem – all the data still had to flow through Apache Kafka,” said Richard Artoul, CEO and Co-Founder of WarpStream Labs. “If we could separate compute and storage to reduce costs and operational burden at the database layer, there was no reason we couldn’t do the same at the streaming layer.”

“We left Datadog to build a data streaming system that is actually cloud native and cost-effective,” said Ryan Worl, CTO and Co-Founder of WarpStream Labs. “With WarpStream, we’ve already made Kafka 10x cheaper and easier to use, and we’re just getting started.”

WarpStream provides a drop-in replacement for Apache Kafka that runs directly on top of object storage, with no local disks. WarpStream’s primary innovation is that it separates compute from storage like a modern data lake does by using object storage (such as AWS S3) as the primary and only storage. Writing and reading directly from object storage enables WarpStream to eliminate inter-zone networking costs which often represent 80%+ of the total cost of ownership of running a large scale Kafka workload. In addition, WarpStream’s compute layer is completely stateless, enabling instant and unlimited scalability while eliminating almost all of the operational burden associated with Apache Kafka.

Starting today, the company’s “Bring Your Own Cloud (BYOC)” deployment option is generally available. BYOC brings all the benefits of a fully managed SaaS directly into the customer’s cloud account, while still reducing costs by 5-10x compared to self hosting Apache Kafka. BYOC combines compute and storage resources within the customer’s environment, with a fully-managed control plane and metadata service that is hosted and managed by WarpStream Labs. Data never leaves the customer’s environment, and customers retain operational control of the platform. You can learn more about WarpStream’s BYOC offering HERE.

“WarpStream will not only reduce costs and increase reliability of existing Kafka users but will expand the use of streaming data by making it easy and affordable for developers to leverage the power of Kafka with a simple and accessible cloud native solution,” said Jerry Chen, partner at Greylock and WarpStream Board Director.