MongoDB: Decoding Billion-Dollar Cloud Bets & Commitments

How significant are 💰 commitments that enterprises make to the cloud?

Take MongoDB - it committed hundreds of millions.

Here is a breakdown & why this matters if you use cloud marketplaces.

Earlier this year, MongoDB disclosed it has over $1B in commitments to "subscriptions, marketing services, and cloud infrastructure capacity." While these cloud commitments are bundled with other services, it’s fairly obvious that they constitute the majority of this $1.16Bn.

Why?

💎 One cloud contract MongoDB signed in 2023 alone is worth $300M

“Subsequent to January 31, 2023, the Company expanded its enterprise partnership arrangement with a cloud infrastructure provider that includes a non-cancelable commitment of $300 million over the next five years, commencing in March 2023” - company shared.

3️⃣ Reasons Why Cloud Commitments Matter:

✔️ Commitments are binding contracts

MongoDB explains: “our non-cancelable multi-year cloud infrastructure capacity commitments, which require us to pay for such capacity irrespective of actual usage.”

✔️ Most Enterprises have Commits

For those in cloud alliances or leveraging cloud marketplaces, these trends are significant. Most enterprises are likely to have similar commitments with at least one, often two hyperscalers.

✔️ Enterprises Spend Commitments via Marketplaces

A strategic advantage that hyperscalers created for companies: the ability to use commits to buy third-party SaaS products via cloud marketplaces. Why? Because this not only drives their cloud consumption but also creates stickiness and a network effect for cloud platforms.

📈 MongoDB's 5X Growth on AWS Marketplace

MongoDB itself knows very well how to leverage cloud marketplaces.

Ruba Borno, VP of WW Channels & Alliances at AWS highlighted at re:Invent 23:

“MongoDB self-service via the AWS Marketplace business has become a strategic channel.

Over the past 18 months their self-service business via the AWS Marketplace has seen an exponential growth rate of more than 5 times!”

📊 MongoDB Expanded Cloud Partnerships & Marketplace Leverage

In 2023, MongoDB expanded its partnerships with all three major cloud providers (AWS, GCP, and Microsoft Azure) to enhance co-marketing, deliver technology integrations that benefit customers, and align with sales strategies.

“During 2023 we expanded our strategic partnership with Microsoft, to make it easier for customers to access MongoDB Atlas within the Microsoft commercial marketplace.

We announced plans to integrate MongoDB Atlas Vector Search with Amazon Bedrock, a fully managed service that enables developers to build and scale generative AI applications. We also launched an AI initiative with GCP…”

See the flywheel effect by now?

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