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In a world where technical talent is at a premium, businesses have to tap into the broader technology ecosystem to help build and scale their digital products. In truth, most companies probably don’t care much how their software is constructed — as long as it has all the features and functionality needed to satisfy their target market.
Against this backdrop, Swedish startup Nhost is setting out to expedite the development process with an open source backend-as-a-service (BaaS) platform that lets developers forget about the infrastructure and focus purely on the customer-facing frontend.
With Nhost, companies can automate their entire backend development and cloud infrastructure spanning file storage, databases, user authentication, APIs, and more.
“We remove a considerable amount of ongoing effort, time, and resources for tasks that are not directly related to the product our customers want to build,” Nhost CEO and cofounder Johan Eliasson told VentureBeat. “With Nhost, they can start building their customer-facing products after only one minute.”
To help fund its next stage of growth, Nhost today announced it has raised $3 million in a round of funding led by Nauta Capital, with participation from some prominent angel investors, including GitHub founders Scott Chacon and Tom Preston-Werner and Netlify founders Christian Bach and Mathias Biilmann Christensen. Existing investor Antler also participated in the round.
Even the biggest technology giants with the deepest pockets look externally to boost their technology stack. Open source software, for example, allows them to benefit from the scalability of community-driven projects. And using third-party APIs (application programming interfaces) also saves them having to develop every component of their application internally.
Nhost and its backend infrastructure are a different proposition, but the idea is the same — to help companies offload some of their requirements to a third party with domain-specific expertise.
The Stockholm-based startup was created in late 2019 with Eliasson as the sole founder, though he soon realized that building what is effectively an open source alternative to Google’s Firebase would be a tall order. After he met software engineer Nuno Pato at a startup accelerator program in early 2020, the duo officially became cofounders.
The global backend-as-a-service market was pegged at $1.6 billion in 2020, according to some estimates, a figure that’s projected to rise to nearly $8 billion by 2027. Existing players such as Firebase claim major clients like Alibaba, the New York Times, Duolingo, Venmo, and Trivago, highlighting that it’s not just cash-strapped startups that want to outsource their backend management.
Open for business
One of Nhost’s major selling points is that it’s an open source project, meaning companies can do with it as they please, though Eliasson notes that the main benefits of its open source status are around “collaboration and transparency.”
There are, of course, other players in the open source BaaS space, such as Back4App, Parse, Kinvey, and Kuzzle. But Nhost considers itself distinct on a number of grounds, chief among them the scope of its single-platform offering.
Nhost offers all the required building blocks for modern software, including a PostgreSQL database, real-time GraphQL API (which is available for most major front-end frameworks, such as React, Flutter, and Vue), authentication, storage, and serverless functions that allow companies to deploy custom code. On top of that, Nhost offers a managed cloud incarnation with plans spanning hobbyists, professionals, and enterprises.
“Our tech stack offers a unique combination of open source tools we haven’t seen anywhere else, plus a tremendous focus on the developer experience,” Eliasson said. “We believe that building robust and highly scalable applications should be fun, fast, and easy for everyone.”
For now, Eliasson said most Nhost customers are “indie-hackers, startups, and agencies,” and it has around 110 paying customers. However, it has aspirations on the enterprise front, something its seed round should help support.
“Our approach is bottom-up — indies, developers, startups, small and medium-sized teams first,” Eliasson explained. “Enterprise will have its own sales channel when the right time comes.”
Nhost is in the process of rolling out enterprise-grade features, including support for single sign-on (SSO), audit logs, and ISO certificates, which have “already been requested by larger customers,” according to Eliasson.
It’s easy to see why Nhost could prove popular for developer teams looking to spin up a quick prototype or minimal viable product (MVP), given that it removes much of the friction involved in launching even a semi-functional app. However, it’s worth noting that prototypes or MVPs are how most modern software starts out — which puts Nhost in a favorable position when the time comes for developers to ramp things up.
“Nhost really shines for MVPs because the stack we chose makes that easy,” Eliasson explained. “That is important for us because there is very low friction for developers to start building, while the platform is scalable, flexible, and performant enough for when their apps get successful and need to scale.”
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