March 8, 2023

In October 2022, 37signals announced they would transition off cloud services in a post titled "Why We're Leaving the Cloud."  

Despite the advantages of the cloud, the downsides were too significant for the company. In this follow-up episode to Leaving the Cloud on REWORK, co-founder David Heinemeier Hansson and Director of Operations Eron Nicholson discuss the progress 37signals has made since they decided to leave the cloud. 

Listen in as they delve into the pros and cons of using the cloud versus owning your hardware and some of the misconceptions people have about cloud costs and expertise. 

Tune in as the pair shares insights from their experience running web applications at scale and offer advice, tips, and tools for startups and businesses looking to optimize their infrastructure. 

Join the discussion as they explore the importance of getting real about the costs of the cloud for small businesses.

Show Notes: 


[00:49] - David reflects on the progress made since the announcement to transition off of cloud services. And why their initial plan for help with the transition didn't work for 37signals' needs. 

[01:37] - How the experience with the failed deal to get help with the cloud transition reinforced the idea of why 37signals wanted to leave the cloud.

[02:33] - David shares some tools that can be used to move out of the cloud, including Docker and Kubernetes. 

[04:21] - Why 37signals opted for a new tool they built called MRSK to assist in their transition and their timeline for being entirely out of the cloud.

[06:11] - Bleeding money: The $38,000 motivator to speed up the timeline and free up cash that could be better spent elsewhere in the business.

[08:33] - The tools: Eron and David discuss the tools (Docker and MRSK) they've used to successfully move two apps, Tadalist and Writeboard, from the cloud to their new system and the template in place for moving the rest of their apps. 

[11:08] - David discusses the criticality ladder they have in place to prioritize their move off the cloud, beginning with the lowest criticality app (Tadalist) before moving on to higher criticality apps like Hey, which deals with email and must always be available to users.

[13:23] - The app transition plan for the next few months.

[13:58] - Eron explains the challenges of staffing up for a project of this magnitude. He also highlights how many of their current AWS-related processes will become streamlined once they have their own infrastructure.

[16:00] - David shares what the cloud is great for, why it doesn't work great for middle-range SaaS companies, and the main reasons for 37signals for bringing their infrastructure back in-house.

[19:31] - Eron explains their advantage in moving back to their own infrastructure and why he hopes that their experience will encourage others to consider moving away from the cloud as well.

[20:24] - Blowing the notion that the cloud is the only option to smithereens: David reflects on the lost knowledge of running your own hardware and the vendors who can help. 

[23:17] - Eron shares how you can lease from vendors like Deft, Digital Ocean, or Hetzner until it makes sense for you to buy your own servers.

[23:46] - David discusses the importance of exploring alternatives to AWS, breaking the misconception that the cloud is the only option, and exploring the most cost-effective solution for your company. 

[26:04] - David responds to a comment suggesting they could have saved money by optimizing cloud costs and the possibly "crippling" variability of cloud costs that is a major concern for smaller companies—a risk eliminated by owning your own hardware. Watch David's YouTube video on MRSK.

[27:57] - Eron explains how they worked to optimize their cloud spend using every single lever at their disposal within AWS, but despite all that effort, they still found that running their own hardware is more cost-effective than using the cloud.

[28:48] - Do you have a question for Jason, David, or anyone at 37signals? Leave us a voicemail at 708-628-7850, and we might answer it on an upcoming show. 

Links and Resources:

Do you have a question for Jason and David? Leave us a voicemail at 708-628-7850. 

Leaving the Cloud | REWORK

David's YouTube video about MRSK
HEY World | HEY 

Basecamp: New Customer Offer: $15 per user/per month or $299/month for unlimited users

37signals on YouTube
The REWORK podcast

The 37signals Dev Blog

@reworkpodcast on Twitter

@37signals on Twitter 

This episode is from Rework whose proprietor has full ownership and responsibility on its contents and artworks. It was shared using Castamatic, a podcast app for iPhone and iPad.