Cloud

How Israeli cloud management startup NewVem is cutting its clients’ Amazon Web Service bills by 25%

There are very few tech startups these days that don’t rely, in whole or in part, on Amazon Web Services. The power of the elastic cloud means small startups with limited resources and employees can scale quickly to great size. Many startups that build on AWS, like Tumblr, continue to use the service when they reach web scale, serving up billions of pageviews each month.

NewVem, an Israeli startup, hopes to tap into this trend by offering a service that lets clients manage and optimize their usage of AWS. “Amazon is really a double edged sword,” Zev Laderman, NewVem’s founder and CEO told me in a phone interview. “It’s a fantastic asset for startups, but many get trapped relying on it without having the tools to really manage it effectively.”

When analyzing a clients AWS, NewVem is looking for several things: underused servers that could be eliminated, overused servers that could hurt performance and security risks that could come back to bite a client down the road.

“We built our entire business on AWS,” said Kobi Haddad, the CEO of LiveDefinition. “It’s a utility, so just like when you use electricity, it’s easy to forget, and leave the lights on when you’re not at home.” NewVem found several servers that LiveDefinition was only using part time, as well as others that were overloaded and increasing latency for clients. “We tried using Amazon’s tools to manage this, but they weren’t very helpful. Thanks to NewVem we’ve rearranged how we deploy AWS, and I think saved about 20 percent each year.”

DoubleVerify, another client, told the same tale. “We started with three servers and now, three years later, we’re using 150,” said Chemi Katz, the head of tech operations at DoubleVerify. “Before NewVem, we didn’t really monitor our AWS usage that closely. The Amazon desktop tool for doing that was impossible to use.”

NewVem not only helped DoubleVerify to monitor which servers were being over and under used, it also helped them decide which colocation nodes it wanted to be on in order to be geographically close to important clients and improve performance for that relationship. “It makes the elastic cloud much more powerful, and saved us about 25 percent of our annual budget, which is no small change,” said Katz.

Amazon recently reported that its elastic cloud business has grow about four fold since 2010. As more and more startups come to rely on it for launching and scaling their business, NewVem sees a massive opportunity to help companies cut costs and avoid the costly overhead of hiring a full time IT staffer to manage the cloud.