Overview
About
Neon is a Brazil-based digital bank that offers credit cards, personal loans, and investment products, among other services.
Challenge
As Neon scaled, they needed to engage more of their engineers in FinOps objectives. Because of visibility limitations and tool complexity, existing solutions had failed to do the trick.
Solution
Implemented CloudZero to boost spend allocation, identify savings opportunities, and give engineers relevant, timely data about the cost of their cloud infrastructure.
Outcomes
- Grew engineering engagement by 700%.
- Automated core financial reporting
- Calculated unit cost metrics: cost per card, cost per customer
The Challenge
Coming into 2023, Neon had a lot to smile about. They’d tripled their revenue shortly before and raised $64 million in their quest to become Brazil’s biggest working-class bank. The Series D outfit was scaling, fast — and behind the scenes, they had some big FinOps goals.
Neon had set a goal of breaking even by the end of 2024, which put a Brazil-sized target on their cloud spending. Managing the company’s cloud costs had thus far fallen on their three-person FinOps team. As the company scaled, they knew that a three-person FinOps operation wasn’t going to cut it.
“We needed to make it easy for the rest of our engineers to get involved in FinOps initiatives,” said Daniel Abreu, Neon’s principal FinOps culture engineer. “And the tool we had in place wasn’t making that easy.”
Neon was using a cloud cost management tool in conjunction with native cloud provider tools like AWS Cost Explorer and CUDOS (which helps AWS customers explore Marketplace costs). They found it labor-intensive to manage several platforms at once, and the tools had severe limitations around cost visibility and engineering engagement.
“We had 4–5 engineers logging into these tools in a given month,” Daniel said. He chalked up the low engagement to tag-based cost allocation — which led to major visibility gaps, especially around Kubernetes spend — and to the complexity of the third-party tool, which made their engineers reluctant to use it.
To strengthen their FinOps culture ahead of major business objectives, Neon was looking for a tool to satisfy several major areas:
- Complete cost allocation. Neon understood that complete visibility was the foundation of FinOps, and needed a partner who could unify 100% of their multi-cloud costs, which spanned AWS (including a large Kubernetes footprint), Azure, GCP, and MongoDB.
- Kubernetes visibility. Due to their substantial Kubernetes spend, Neon was particularly intent on finding a tool that could seamlessly blend containerized and non-containerized spend.
- Engineering-led optimization. Ultimately, Neon wanted their engineers to autonomously manage their own cloud costs, extending FinOps best practices throughout all cloud consumers in their organization.
- Unit economics clarity. Neon knew that quantifying the health of their cloud spend meant strengthening their unit economics — developing core unit cost metrics that correlated with business value, and tracking them accurately over time. Cost per card, specifically, was the metric they wanted to track.
The Solution
Neon had begun by trialing some legacy cost management tools. Upon hearing about CloudZero, via a blog post, they decided to add CloudZero to the mix.
Upon starting the proof-of-value (POV) process, Neon was immediately pleased by the platform’s ease-of-use and the pre-sales team’s active responsiveness.
“The POV was great,” Daniel said. “The team acted quickly, understood all the items that were most important to us, and incorporated all of them into the trial. The tool’s friendly interface really caught our attention, and then integrating with and allocating cloud provider costs was really easy.”
CloudZero rapidly unified cost data from the majority of Neon’s vendors, integrating containerized and non-containerized spend in a single pane of glass. From there, it was just a matter of getting the rest of their engineers involved.
The Results
Grew engineering engagement by 700%
“We started with maximum five engineers logging into our former tools,” Daniel said. “Now, about six months into CloudZero deployment, we have 40 monthly active users.”
Daniel attributes the precipitous increase to CloudZero’s ease-of-use, complete visibility (which means every engineering team now has a 100% accurate portrait of the cloud costs they’re responsible for), and Insights workflow.
CloudZero Insights is the process by which users find, organize, and address cloud savings opportunities. In two standout examples, Neon engineers reduced the cost of an expensive S3 resource by 77%, and later reduced the cost of an expensive EC2 instance by 40%.
“The whole process was simple,” Daniel said. “From finding the insight to figuring out who should address it to realizing the savings. That’s an amazing feedback loop for engineers — and it makes them want to find more.”
Automated core financial reporting
To date, CloudZero and Neon have collaborated to create 44 dashboards in CloudZero Analytics, which automates core cloud cost reporting. Standout reports include one Neon’s finance team uses for chargeback, and Forecasted Month-End Costs, which forecast three months of future cloud provider costs.
“It’s really strengthened our relationship with the finance team,” Daniel said. “Analytics automates what would otherwise be a long manual process, and sends the reports to them on a regular basis. They have better cost insights, so we can all spend more time on strategic goals.”
Calculated unit cost metrics: cost per card, cost per customer
“An overarching objective is to reduce our cost to serve,” Daniel said. “If we can do that while we scale, we know we’ve got a healthy business.”
A mere six months into the relationship, CloudZero built out an elaborate Analytics dashboard containing an array of data on Neon’s cost per card. This includes overall cost per card data, as well as more granular cost per card per AWS service, in view of Kubernetes direct costs, and more.
“This gets at the essence of our business value,” Daniel said. “It’s the Holy Grail of FinOps.”
Overall, Daniel and his team have been very satisfied by the CloudZero experience.
“CloudZero’s ease-of-use is fantastic, and it’s very easy to integrate with whatever cost sources you want,” he said. “The CS team’s support is very fast, and they’re always willing to take suggestions to the product team. It’s been great so far, and I imagine it’ll only get better.”
