Vercel
In a significant move signaling its growth trajectory, Vercel, an AI startup boasting a valuation that eclipses a staggering $3 billion, has fortified its board by welcoming Steffan Tomlinson, Stripe’s Chief Financial Officer (CFO). This strategic addition was made public on a Tuesday that might just alter the landscape.
Tomlinson comes equipped with a wealth of experience, having navigated the treacherous waters of IPOs for tech beacons such as Palo Alto Networks and Confluent. His role at Vercel marks another chapter in a career intimately acquainted with scaling startups toward public markets.
Stripe, often lauded as a titan among startups, is gearing up for its own IPO ambitions. Meanwhile, Vercel stands at an earlier juncture in its corporate lifecycle but is already laying the groundwork for what could eventually be a public offering. “Steffan’s expertise in shepherding developer-centric companies through the choppy waters of public markets makes him an indispensable asset as we scale our vision,” mused Vercel’s CEO and founder, Guillermo Rauch.
Last year, the company had already taken strides toward solid fiscal management by bringing on Marten Abrahamsen as its CFO. Abrahamsen has rolled up his sleeves, establishing robust finance, legal, and corporate development frameworks while orchestrating a $250 million funding round that elevated the startup’s valuation to $3.25 billion.
A Surge of Generative AI
Sparked by the burgeoning generative AI sector, Vercel is riding a wave of impressive growth, emerging as a vital player in providing AI tools for developers. Just this year, the company crossed the remarkable threshold of $100 million in annualized revenue. Its AI SDK—akin to a treasure chest for developers—was downloaded over 700,000 times last week alone, a tenfold increase from the previous year’s numbers. Furthermore, Vercel’s open-source framework, Next.js, saw downloads soar to a staggering 7.9 million last week, up from a steep 4.6 million just a year prior.
Abrahamsen is candid about Vercel’s aspirations for the future, emphasizing a commitment to a public offering, albeit without a definitive timeline. The excitement buzzes through the company as they capitalize on their innovative offerings.
Consumption-Based Revenue Models
Tomlinson’s tenure at Stripe and Confluent endowed him with invaluable insights on the intricacies of consumption-based software revenue models, which empower firms like Vercel to charge customers based on their usage rather than ticking up fees based on the number of users. This symbiotic relationship paves the way for aligned interests: as demand surges, so does revenue—an evolution from the traditional software-as-a-service model.
“Steffan’s impressive track record with consumption-based business strategies makes him the go-to consultant for shaping our strategic initiatives,” asserted Rauch. In an era where technical founders are at the helm, Tomlinson’s experience working alongside visionary leaders such as the Collison brothers at Stripe positions him as a vital ally in illuminating Vercel’s path.
