Digital Ocean continues its user growth, opens new Amsterdam data center

By Cale Guthrie Weissman , written on December 2, 2013

From The News Desk

Cloud hosting: It's one of those things most everyone is getting now, and seems pretty cut and dry. There are a lot of big names out there, Amazon Web Services being probably the most well-known. But this hasn't stopped other smaller entities from entering the scene and showing why they may be a better alternative.

Take Digital Ocean for example. It, like AWS and Rackspace, offers cloud-based Web hosting, but it focuses on small businesses and developers. A few months back the company raised $3.2 million, as well as touted a massive uptick in user growth, as its name began to proliferate (5084.64 percent). Today the startup is continuing its attempt to scale with growth by opening a new data center in Amsterdam.

What makes Digital Ocean different is its services that cater primarily to developers. This means is that the startup's cloud-hosting options are catered to the issues most apparent to small businesses or individual developers, as opposed to large enterprise-level players. "Our focus is on simplifying Web info structure for developers," Ben Uretsky, the company's CEO said.

To do this Digital Ocean offers easily understood SSD-based web hosting packages that focus on what devs and small businesses need. There are five choices, ranging from $5 per month to $80 per month. (For larger hosting, there are five more plans). This is contrasted with the endless choices and contingencies available for services like Rackspace and Amazon Web Services, which focus more on enterprise customers.

Additionally, Digital Ocean now offers shared private networking for those who want to have a private IP address in addition to a public one.

Uretsky ironically harped on the company's recent success. "It's certainly been challenging to double the business every two to three months," he told me. Europe has begun playing a large role in this, thus the new Amsterdam data center. "We've run out of network capacity, out of server capacity, and also just run out of space," he said. This same thing happened to its New York servers earlier this year.

The first Amsterdam data center housed 1,000 physical machines; this new one has the capacity for 10,000 (although, its startup with just 500 for now). This makes it ten times the size of the original Amsterdam data center.

Following this announcement, Uretsky said the company has a lot of projects for the next year to help it scale with its rising growth. This includes an additional data center in Asia, and a switch from the legacy IP address standard IPv4 to IPv6. According to Uretsky, Digital Ocean has had to begin buying IP space on the black market because IPv4 availability is running dry.

"The big push for IPv4 will alleviate the need to use this legacy IP space," he said. So, coming soon will be Digital Ocean using IPv6 and non-black market addresses to boot.

With all of these factors, Uretsky only sees Digital Ocean becoming bigger. "Large cloud providers create a broken cloud understanding," he said. He sees steady user acquisition as proof that the company has hit the right market. It recently crossed the 100,000th customer, which he believes indicates that it is successfully "leveraging [the developer] ecosystem."

Additionally, Uretsky has no plans of pivoting and offering hosting services for larger companies, because why change a good thing? Digital Ocean is an on-demand cloud provider, but, as Uretsky reminded me, "we're all about the developer."

And, right now, that seems to be a good thing.

[Illustration for Pando by Hallie Bateman]