Scaling CockroachDB: A Guide for Relational Database Users

Challenging the Relational Database Status Quo

The majority of new database companies steer clear of developing relational databases. This is due to the firm grip a handful of major players have on that particular segment of the market. For decades, companies of considerable and medium size have integrated Oracle, MySQL, and Microsoft SQL Server into their core technical infrastructure.

These long-standing organizations possess substantial market dominance and financial resources, enabling them to effectively suppress emerging competition.

A Shift Towards Alternative Database Architectures

Consequently, instead of directly challenging the established relational database providers, many database startups over the last ten years have concentrated on alternative database architectures. These include document-oriented databases, such as MongoDB, key-value stores like Redis, and graph databases, exemplified by Neo4J.

However, Cockroach Labs defied this common approach with CockroachDB. The company deliberately entered the relational database market, offering a relational database product.

The Advantage of an Existing Market

Despite facing considerable challenges in gaining market penetration, Cockroach Labs discovered an unexpected advantage. The company didn’t need to create demand for a new type of database; it simply needed to capture a portion of an already expanding market.

Previous sections of this series examined the beginnings of CockroachDB, provided a detailed technical overview of its product, and analyzed the company’s developer relations efforts and its cloud service, CockroachCloud.

Looking Ahead: Future Prospects and Challenges

This final part will focus on the company’s future trajectory, the competitive dynamics within the relational database landscape, its capacity to retain skilled employees as it considers a potential IPO or acquisition, and the inherent risks it confronts.

The long-term success of CockroachDB is not assured. Significant obstacles must be overcome to establish a sustainable and profitable position amongst well-entrenched database technologies backed by financially powerful corporations.

Lessons from MongoDB's Success

However, achieving this is not beyond the realm of possibility. We will begin by examining MongoDB as a case study of how a company can successfully navigate the challenges faced by database startups competing with established industry leaders.

Here's a breakdown of key factors:

Established players control significant market share.
Alternative database architectures gained traction.
CockroachDB intentionally entered a competitive market.
The existing market offered a growth opportunity.

From Mongos to MongoDB: A Database Evolution

scaling cockroachdb in the red ocean of relational databases

MongoDB serves as a compelling illustration of the challenges inherent in pioneering a new database market segment. Initially, the company focused exclusively on a document-centric database model, a strategy that diverged from the prevailing industry norms.

The document-centric approach resonated with web developers due to its effectiveness in addressing common application requirements. Storing blog post comments or comprehensive customer order histories and profiles are examples where this model proves particularly useful.

The Divergence in Perspectives

Conversely, developers experienced with relational databases often avoid document-centric systems. This reluctance stems from the potential for data redundancy, which can introduce errors and increase the complexity of application development.

In a document-centric database, identical data may be duplicated across multiple documents. Consequently, updates require synchronization across all instances, a process that becomes increasingly resource-intensive with a growing number of documents.

Updating millions of documents demands significant computational power and expense, contrasting with the efficiency of traditional relational databases.

A Strategy Focused on Startups

MongoDB’s initial growth strategy centered on expanding the market for document-centric databases. Rather than targeting established enterprises – banks, insurers, manufacturers, and retailers – who traditionally relied on relational systems, the company prioritized startups.

Startups, unburdened by existing storage infrastructure, found MongoDB well-suited to their needs. As these startups scaled, MongoDB’s adoption grew accordingly.

This success eventually attracted the attention of larger, legacy organizations. They began experimenting with MongoDB in lower-stakes, exploratory projects where a document-centric approach was appropriate.

This adoption created a demand for MongoDB within established Fortune 1000 companies, but also presented a significant hurdle.

The Demand for Relational Features

Developers familiar with document-centric architectures readily grasped its nuances. However, those accustomed to relational databases required MongoDB to align more closely with their established workflows.

Large companies articulated a need for features commonly found in relational databases, specifically transactions, as a prerequisite for production deployment. (Further discussion on transactions can be found in part 1).

Responding to this demand, MongoDB integrated transaction support into its product. The response was polarized.

While banks and insurance companies welcomed the addition, document-centric database advocates expressed strong disapproval. For many, transactions fundamentally contradicted the core principles of a document-centric design.

A Hybrid Approach and its Consequences

This shift away from a purely document-centric focus fundamentally altered the company and its technology. Some argue that this change diluted MongoDB’s original vision.

Attempting to satisfy both document-centric and relational database paradigms introduced additional complexities – conceptually, operationally, and culturally. MongoDB transitioned from one type of organization to another.

Despite these challenges, MongoDB’s hybrid strategy proved successful. The company ultimately achieved a public listing with a market capitalization approaching $23 billion.

Today, MongoDB stands as a prominent example of success among this generation of database startups, despite navigating a complex and unconventional path to achieve it.

The Unique Approach of CockroachDB

Cockroach Labs maintains a steadfast commitment to relational database technology, remaining focused on this core area since its founding seven years ago. This singular vision has consistently guided the company’s development.

According to Spencer Kimball, co-founder and CEO of Cockroach Labs, the continued relevance of relational databases within the software landscape ensures that any successful innovation in this field will naturally attract substantial business interest.

However, sustained success for Cockroach Labs hinges on achieving two key objectives. Firstly, attracting and expanding its user base among new, greenfield startups – those unburdened by existing technology investments – is crucial. Secondly, securing a significant portion of the Fortune 1000 market is essential for long-term prosperity. The central question revolves around the strategy to accomplish this.

Globally Distributed by Design

From its inception, CockroachDB was engineered as a truly globally distributed relational database. While other database systems can be deployed across multiple regions, CockroachDB’s architecture inherently prioritizes global data access and resilience.

Many databases attempt to globalize data by deploying redundant servers in various regions. Conversely, CockroachDB actively distributes data to regions, ensuring users access information from the server closest to their location. This granular approach enhances data access speeds.

Achieving this level of distribution is possible with other databases, but typically demands considerable expertise and custom programming. CockroachDB distinguishes itself by automating this globalization process. This capability addresses a critical need for organizations requiring faster access to global data than their current relational databases can provide.

This inherent advantage is reflected in the company’s growth, which, as reported by Chief Revenue Officer Jeff Miller, exceeds 100% annually.

Baidu: A Key Success Story

The inclusion of Chinese search and internet giant, Baidu, as a featured success story highlights CockroachDB’s capabilities. Baidu transitioned from MySQL to CockroachDB to effectively support its extensive user base of 1 billion and manage 40 TB of data.

Baidu’s adoption of CockroachDB wasn’t simply a case of a startup choosing a new technology. It represents a deliberate shift by an established enterprise from a widely-used relational database to CockroachDB. This type of customer is precisely what Cockroach Labs aims to attract.

Competing in a Crowded Market

CockroachDB is positioned to compete directly with established players such as Oracle, Postgres, MySQL, Microsoft SQL Server, AWS Aurora, and Google Cloud Spanner. Cockroach Labs possesses the necessary financial resources and technical expertise to deliver a competitive product in terms of features, pricing, and support.

These accomplishments are noteworthy, but they also introduce new challenges, particularly in the area of talent acquisition and retention – essential for sustaining the company’s momentum.

Cultivating Talent: Cockroach Labs' Approach in New York City and Beyond

Cockroach Labs, like many technology firms – particularly those in the database sector – prioritizes the acquisition of highly skilled personnel and demonstrates a willingness to offer competitive compensation. Analysis from Glassdoor indicates an average annual salary of approximately $169,000 for technical staff at Cockroach Labs, positioning the company favorably within the industry’s pay scale, excluding equity.

To proactively address competition for skilled workers, Cockroach Labs employs a unique retention strategy, initiating even before formal employment. The company extends stock options to its college-level interns. Upon these interns’ subsequent return as full-time employees post-graduation, their vesting schedule incorporates their prior internship period.

Regarding standard HR metrics, Cockroach Labs exhibits strong performance. Lindsay Grenawalt, Chief People Officer, reports an annual employee attrition rate of 10%, which is lower than the industry average of 13.2%.

Furthermore, the company was recognized by .Inc Magazine as a Best Place to Work in 2021. This positive environment facilitated a substantial increase in headcount to 285 employees in 2021, representing a growth of 182%, as documented on LinkedIn.

Co-founder Spencer Kimball, boasting a 4.8 out of 5 rating on Glassdoor as CEO, appears to be a key factor in the company’s success. Interviews with several senior executives reveal that his leadership was instrumental in attracting experienced professionals with extensive backgrounds in enterprise-level software development.

Notably, the company’s remaining two co-founders remain actively involved after seven years, despite Kimball’s prominent role within Cockroach Labs. Successfully fostering an environment that satisfies the recognition and achievement needs of all stakeholders, especially C-suite executives, presents a significant challenge.

The startup appears adept at cultivating a desirable and expanding workplace while simultaneously accommodating the professional aspirations of its leadership team.

In essence, Cockroach Labs distinguishes itself as an engineering-driven organization, guided by engineers, and supported by a seasoned executive team possessing considerable expertise in distributed data management solutions.

The founders’ prior experience at Google provided valuable insights into effective strategies for motivating and managing technical talent. Grenawalt, also a former Google employee, states, “Google sets the benchmark for modern engineering companies. We leveraged our experiences at Google to develop a unique approach, incorporating Google’s best practices to create a superior employment experience at Cockroach Labs.”

Navigating Opportunities and Potential Risks for Cockroach Labs

Cockroach Labs demonstrates significant promise, boasting innovative technology, substantial financial resources, and a highly skilled executive team. The organization maintains a strong engineering culture, extending even into its sales and marketing divisions.

Many organizations, initially focused on technical excellence, experience a shift in priorities as operational necessities take precedence over advanced technological development. Thus far, Cockroach Labs has successfully avoided this common pitfall.

The company is currently executing many of the key strategies essential for a thriving startup. However, substantial challenges lie ahead, particularly as it matures into a credible competitor against larger, well-established companies possessing considerable resources to defend against CockroachDB’s market penetration.

In this assessment, certain risks are apparent. A primary concern is the possibility of a premature acquisition, potentially initiated by a major corporation seeking a relational database solution like CockroachDB to complement its existing product offerings.

Alternatively, a competitor might seek to acquire CockroachDB solely to remove it as a competitive threat. While less probable, this scenario remains a possibility.

Although several competitors offer globally distributed database technologies comparable to CockroachDB and CockroachCloud, numerous large cloud providers currently lack such capabilities. This positions CockroachDB as an appealing acquisition target.

A major cloud provider requiring Cockroach Labs’ expertise could present an offer that is difficult to decline. Following an acquisition, CockroachDB could either flourish or stagnate, as history demonstrates that acquired technologies are sometimes shelved indefinitely.

Another potential risk involves Cockroach Labs’ ability to fully capitalize on the potential of CockroachCloud within the cloud computing landscape. Currently, CockroachCloud is marketed as a solution for organizations wishing to leverage CockroachDB without the expense and complexity of managing their own on-premise clusters at scale.

This strategy aligns with prevailing market trends. However, as experienced cloud providers have shown, offering a single service is often merely the initial step towards a broader market presence.

We are currently observing the development of sophisticated cloud platforms. For instance, both AWS and Google Cloud began by providing on-demand computing and storage. They have since expanded to offer a diverse range of cloud services across numerous domains.

While CockroachCloud provides the necessary intelligence for deploying, monitoring, and managing CockroachDB clusters, these clusters currently operate on AWS or Google Cloud. The ability to deliver CockroachDB as a cloud service is noteworthy, but not unique, as Google and AWS offer similar solutions.

Transforming CockroachCloud into a comprehensive intelligent cloud service, extending beyond simply providing scalable database capabilities, will elevate Cockroach Labs beyond a database vendor. Developing a broad suite of intelligent services would position the company to shape the future of data management globally.

This is an ambitious goal, undoubtedly. Nevertheless, it is a vision shared by many forward-thinking individuals currently employed by Cockroach Labs’ competitors. Only time will reveal whether Cockroach Labs can compete at this level.

Ultimately, an initial public offering (IPO) appears to be a likely trajectory for Cockroach Labs. An IPO has consistently been part of the company’s long-term strategy – a conclusion supported by the significant venture capital investment it has received. The timing of the IPO remains confidential, but it is anticipated unless an acquisition occurs beforehand.

CockroachDB has progressed considerably since its initial open-source release on GitHub in May 2017. The company’s future success will depend on its continued technological evolution and its response to the challenges and pressures associated with its eventual IPO.