Algolia: Going Global to Compete with Google


February 8, 2017 at 12:00 AM Coordinated Universal Time

Five years ago, when Algolia was founded, its founding duo were very much grounded in the French startup ecosystem. Nicolas Dessaigne and Julien Lemoine had both recently quit roles at Exalead, a software company whose alumni, known for their phenomenal success, have been dubbed the ‘Exalead Mafia’.

Following the pair’s graduation from Y Combinator’s winter 2014 class, however, Algolia’s expansion outside France came quickly. Despite retaining a large Parisian presence, Dessaigne and Lemoine moved their headquarters to San Francisco. They hold a lot of affection for their home country and its development. But the need to go global, for a company fighting the stiffest opposition around, was huge.

In 2016 93% of all Internet experiences started with search. When the topic of online searches arises, though, few look beyond Google. Algolia, though, does something different. Its search-as-you-type service targets individual online players via APIs that focus on “the three pillars of search”: speed, relevance and design.

Algolia did not even begin as a search-as-a-service offering at all, but rather a software development kit for providing faster searches in mobile apps. But Dessaigne and Lemoine soon realized that the constraints of smartphone technology were holding them back.

“We simply couldn’t apply the traditional state-of-the-art search engine to this use case,” Dessaigne tells Red Herring. “We had to reinvent search. The hardware limitations led us to make completely different tradeoffs than what we would have done on servers–things we actually would never have thought of without the constraints of mobile.

“We later pivoted to SaaS and a server-based approach, but the choices made for mobile helped to differentiate the product and made it the best possible fit for user-facing search,” he adds. “It’s today a big reason for our success.”

Dessaigne claims that to compete with Google and others, Algolia had to think global from day one. The biggest market was–and still is–the US. Even to think locally would be to lose the company’s edge. Algolia is now in 47 locations across 15 regions with over 1,600 clients including Medium, Periscope and VEVO.

This year the company plans to open offices in the UK and Australia. Its founders’ vision appears to have paid off.

To date the company has won over $21 million from three investment rounds, led by some of the world’s best known funds including 500 Startups, Accel Partners and Point Nine Capital. But it wasn’t just money that attracted Algolia stateside. The San Francisco API ecosystem, says Dessaigne, was just as, if not more, important.

“API became the building blocks of new software,” he says. “While some API were already available in 2012, like Amazon S3, Twilio, Stripe, there were not yet the mainstream approach to build software.

“Today the shift has happened for a significant part of the market and is actually faster than we anticipated,” Dessaigne adds. “We expect the big majority software development to use APIs in a few years.”

Various APIs are catered to by Algolia, and it is available across ten coding languages. The company provides 99% of its searches in under 35 milliseconds. This matters: 100ms of latency can cause Amazon to lose 1% of its sales, for example–500ms costs Google 10% of its traffic. The blink of an eye is roughly 180ms.

But speed is only one part of the puzzle. When you’re an upstart facing off against one of the world’s corporate juggernauts, it’s vital to retain customer trust at all times. With that in mind Algolia has transformed its service level agreements (SLAs)–and it’s a model others are closely scrutinizing.

Algolia believes it is possible to assure clients 99.99% uptime. This is achieved in three ways. “First, we built the first distributed search network (DSN)–a CDN for your search experience–which means we can deliver search results in under 35ms anywhere your customers are,” Dessaigne says.

“Second, we host your search securely in three different servers in three different data centers from up to three different providers, meaning that we are ready for the most unexpected of outages,” he adds. “Last, we developed a DNS fallback system in case of DDoS attacks, which means that if we detect DNS latency, we can fallback to a different DNS.”

Buoyed by its funding and big-name clients, Algolia is looking to another year of fast expansion. And as France’s tech ecosystem is boosted by the likes of Station F and TheFamily, it has no plans to abandon its hometown, whose VC system is “growing fast.

“French VCs are becoming bolder, investing internationally and in more ambitious projects, and US VCs are getting much more involved in local rounds of funding,” says Dessaigne. “All for the best for entrepreneurs.”

And all the better for Algolia, the Exalead mafia and a new generation of French entrepreneurs trying to change the world–even if they run up against goliaths like Google. Dessaigne and Lemoine are living proof that Parisian tech, like its culture, can go truly global.