Animoto rebuilt on AWS in 2007 and scaled from 25,000 to 250,000 users in four days

A consumer app that turned users' photos into videos with music, later a B2B video tool for marketing departments

A consumer video startup can rely on Amazon's brand-new elastic cloud to absorb a viral spike rather than buying servers for demand that might not come

Raised $30M in total; Amazon was its first outside investor after friends and family, with its last funding in 2011

Founded in 2006, Animoto began building its own servers to prove the concept before it had funding. As traction grew, CEO Brad Jefferson said the team realized that it was easy to prepare for failure but they needed to prepare for success, and chose to bet on AWS, which in 2007 was an e-commerce company with an unproven concept.

Animoto spent six months rearchitecting its software for Amazon's cloud. Its model offered a free 30-second video, $5 for a longer clip or $30 a year, and each video launched a separate EC2 instance. In 2008 it launched a Facebook app at South by Southwest and demand exploded. AWS engineers scrambled to supply servers, and Animoto stayed up as instance counts rose from 50-100 a day to 400, then 900, then 3,400 and peaked at 5,000.

Animoto kept up with the surge, which AWS cited as proof that elastic computing worked; the story became a selling point for AWS. Jefferson says Animoto is still an AWS customer, and the company is now more of a B2B operation.

Its own servers would have required big capital spending before it had funding or proof of demand

Jefferson found it hard to model resource needs for a business with free and low-priced videos

AWS offered unlimited compute that scaled up and down with demand

Jefferson judged that servers sitting dormant most of the time were untenable for a consumer app with unpredictable demand, so paying for elastic capacity beat betting on a forecast.

As of September 2021 Animoto was still an AWS customer, now operating mostly as a B2B video tool; the 2008 surge is told from the CEO's and an AWS executive's recollections.