Cloudflare

SpaceX

Cloudflare

Cloudflare operates on a freemium model with usage-based pricing. The free tier provides basic CDN, DDoS protection, and SSL for any website — this is how millions of sites use Cloudflare without paying a cent.

Paid plans start at $20/month (Pro), $200/month (Business), and custom enterprise pricing for large organizations.

The free tier is the growth engine, not charity. Every free website that routes through Cloudflare adds data to the network — more traffic patterns to analyze, more attacks to learn from, more threat intelligence to feed the machine learning models.

Free users make the paid product better.

Enterprise contracts are where the real money lives. Large organizations pay six and seven figures annually for advanced security, performance, and compliance features.

Revenue exceeded $1.7 billion in 2024, growing 30%+ year-over-year. The company has been approaching profitability with improving margins.

SpaceX

SpaceX makes money three ways. First, launch services — companies and governments pay SpaceX to put their satellites into orbit.

A Falcon 9 launch costs about $67 million, which undercut the competition by 75% when it debuted. Second, Starlink — SpaceX's own satellite internet constellation, which is now generating over $6 billion in annual revenue from 4+ million subscribers.

Third, government contracts — NASA pays SpaceX to ferry astronauts to the International Space Station and the DoD pays for national security launches.

The secret sauce is reusability. Before SpaceX, every rocket was used once and thrown into the ocean.

SpaceX figured out how to land the first stage booster back on Earth and fly it again. A single Falcon 9 booster has flown over 20 times.

That's like the difference between throwing away an airplane after every flight versus keeping it for decades.

Cloudflare

The origin story starts with Project Honey Pot, a free open-source project that Matthew Prince created in 2004 to track online spammers and hackers. The project grew to track millions of malicious IP addresses, and the Department of Homeland Security started using the data.

But Prince noticed something: he had all this threat intelligence and no good way to help website owners actually use it.

At Harvard Business School in 2009, Prince teamed up with Michelle Zatlyn for a class project exploring how to turn that threat data into a product. Their professor gave them a B — which Prince has jokingly called the most expensive B in HBS history, given what the company became.

They brought in Lee Holloway, a brilliant but unconventional systems programmer Prince had worked with previously, as the third co-founder and technical architect.

Cloudflare launched publicly at TechCrunch Disrupt in September 2010 with a bold pitch: sign up for free, change your DNS, and Cloudflare will make your website faster and more secure. No hardware to install.

No software to configure. Just a DNS change.

In the first day, thousands of websites signed up. The simplicity was the product — in an industry where security meant expensive appliances and complex configurations, Cloudflare said "just point your domain at us and we'll handle it."

SpaceX

In 2001, Elon Musk had just sold PayPal to eBay for $1.5 billion and was sitting on roughly $180 million after taxes. Most people would buy an island.

Musk decided to buy rockets. His original idea was even weirder — he wanted to send a small greenhouse to Mars called "Mars Oasis" to reignite public interest in space exploration.

He flew to Russia three times to buy refurbished ICBMs. The Russians kept raising the price and at one point literally spat on him.

On the flight home from that last failed Russia trip, Musk opened a spreadsheet and started calculating the raw material costs of building a rocket from scratch. He realized the materials were only about 3% of the typical price of a rocket.

The rest was markup, inefficiency, and monopoly pricing by companies like Boeing and Lockheed Martin. He decided to build his own.

SpaceX was founded in June 2002 in a warehouse in El Segundo, California. Musk put in $100 million of his own money.

He hired Tom Mueller, a legendary rocket propulsion engineer who had been building rocket engines in his garage as a hobby. The first rocket, Falcon 1, was supposed to be the cheapest orbital rocket ever built.

It took six years and three spectacular explosions before it finally worked.

Cloudflare

Cloudflare grew by being free. The free tier removed every barrier to adoption.

A blogger in India and a Fortune 500 company could both sign up in five minutes. This created a massive installed base that generates word-of-mouth, training data, and upsell opportunities.

The developer community became the second growth engine. Cloudflare Workers turned the company from a security vendor into a cloud computing platform.

Developers build entire applications on Cloudflare's edge network, which creates deep technical lock-in. Once your application runs on Workers, migrating to AWS Lambda is a significant engineering effort.

Strategic pricing warfare accelerated commercial adoption. When Cloudflare launched R2 storage with zero egress fees, it directly attacked Amazon S3's most hated pricing model.

The "Bandwidth Alliance" partnered with cloud providers to eliminate data transfer fees. These moves positioned Cloudflare as the anti-AWS — the cloud company that doesn't nickel-and-dime you.

SpaceX

SpaceX's growth strategy was simple: be cheaper than everyone, then be better than everyone, then be the only option.

They started by undercutting the launch market. The United Launch Alliance (Boeing + Lockheed Martin joint venture) was charging $300-400 million per launch.

SpaceX offered $67 million. Government agencies and commercial satellite companies started lining up.

Reusability was the real game-changer. Landing a rocket booster looked like science fiction when SpaceX first attempted it in 2013.

They failed over and over — spectacular ocean landings, explosions on drone ships, near-misses. But in December 2015, a Falcon 9 first stage landed back at Cape Canaveral.

It was the first time an orbital-class rocket had ever landed after a mission. Now they do it routinely — it's almost boring.

Starlink created a completely new revenue stream. Instead of just launching other people's satellites, SpaceX launched thousands of its own.

By 2024, Starlink had over 4 million subscribers and was generating billions in revenue. It turned SpaceX from a launch company into a telecom company.

Cloudflare

AWS, Google Cloud, and Microsoft Azure are simultaneously partners and competitors. Cloudflare's network sits in front of these clouds, which makes the cloud providers uncomfortable.

As Cloudflare expands into compute (Workers), storage (R2), and databases (D1), the competitive overlap grows. The cloud providers could theoretically build or acquire similar capabilities and bundle them for free.

Profitability pressure is real. Cloudflare has prioritized growth over profits, spending aggressively on network expansion and R&D.

Operating margins have been negative for most of the company's public life, though they've been improving. Investors have tolerated this during growth-stock mania but patience may not last forever.

Content moderation controversies arise periodically. As a company that provides infrastructure to millions of websites, Cloudflare occasionally faces pressure to terminate service to controversial or harmful sites.

They removed 8chan after the El Paso shooting in 2019 and the Daily Stormer in 2017. Prince has described these decisions as uncomfortable, arguing that infrastructure providers shouldn't be arbiters of online speech but sometimes have no choice.

SpaceX

The early days nearly killed the company. SpaceX's first three Falcon 1 launches all failed.

The first one in 2006 crashed 25 seconds after liftoff due to a corroded fuel line nut. The second in 2007 reached space but the second stage shut down early.

The third in 2008 failed because the first and second stages collided during separation. Musk had enough money for one more attempt.

If flight four failed, SpaceX was dead.

Flight four worked. On September 28, 2008, Falcon 1 became the first privately developed liquid-fuel rocket to reach orbit.

Musk has said he was so stressed during that period he was throwing up regularly.

The financial pressure was existential. Musk was simultaneously funding Tesla, which was also on the brink of bankruptcy in 2008.

He had to split his last $40 million between the two companies. He borrowed money for rent.

But right at the end of 2008, NASA awarded SpaceX a $1.6 billion contract to resupply the International Space Station. That contract saved the company.

Starship development has been its own saga. The rocket has exploded multiple times during testing.

Each failure costs hundreds of millions. But SpaceX treats failures as data — they move faster by blowing things up and iterating than competitors do by being cautious.

Cloudflare

Cloudflare CDN — a content delivery network spanning 330+ cities in 120+ countries that caches and serves web content from the nearest location to each user, making websites dramatically faster. Cloudflare DDoS Protection — automatic detection and mitigation of distributed denial-of-service attacks.

Has blocked some of the largest DDoS attacks in internet history, including a 71 million requests-per-second attack in 2023. Cloudflare Workers — a serverless computing platform that lets developers deploy code to Cloudflare's edge network, running applications in 330+ locations worldwide with millisecond latency.

Cloudflare Zero Trust — a complete security platform replacing traditional VPNs and firewalls with identity-based access controls for remote workforces. Cloudflare R2 — object storage that competes with Amazon S3 but with zero egress fees, saving companies thousands on data transfer costs.

SpaceX

Falcon 9 is the workhorse — the most-launched rocket in the world. It carries satellites to orbit and astronauts to the ISS, and the first stage lands itself for reuse.

Falcon Heavy is three Falcon 9 boosters strapped together — the most powerful operational rocket in the world until Starship came along. Dragon is the spacecraft that carries astronauts and cargo to the ISS.

It's the only American vehicle currently flying humans to space. Starlink is the satellite internet service — over 6,000 satellites in orbit delivering broadband to 100+ countries.

Starship is the big one — the tallest and most powerful rocket ever built, designed to carry 100+ people to Mars. It's still in testing but has already completed a full flight.

Cloudflare

New Enterprise Associates (NEA) led the Series A. Venrock, Pelion Venture Partners, and Union Square Ventures invested early.

Fidelity, Microsoft, Google Capital (now CapitalG), and Baidu all invested in later rounds — notably both Google and Baidu investing in the same company. The September 2019 IPO raised $525 million at a $4.4 billion valuation.

The stock has since grown significantly.

SpaceX

Founders Fund, Draper Fisher Jurvetson, Google, Fidelity Investments, Valor Equity Partners, Baillie Gifford, a]6z (Andreessen Horowitz), NASA (as customer/partner)