David Heinemeier Hansson

February 7, 2025

Servers can last a long time

We bought sixty-one servers for the launch of Basecamp 3 back in 2015. Dell R430s and R630s, packing thousands of cores and terabytes of RAM. Enough to fill all the app, job, cache, and database duties we needed. The entire outlay for this fleet was about half a million dollars, and it's only now, almost a decade later, that we're finally retiring the bulk of them for a full hardware refresh. What a bargain!

That's over 3,500 days of service from this fleet, at a fully amortized cost of just $142/day. For everything needed to run Basecamp. A software service that has grossed hundreds of millions of dollars in that decade.

We've of course had other expenses beyond hardware from operating Basecamp over the past decade. The ops team, the bandwidth, the power, and the cabinet rental across both our data centers. But none the less, owning our own iron has been a fantastically profitable proposition. Millions of dollars saved over renting in the cloud.

And we aren't even done deriving value from this venerable fleet! The database servers, Dell R630s w/ Xeon E5-2699 CPUs and 768G of RAM, are getting handed down to some of our heritage apps. They will keep on trucking until they give up the ghost.

When we did the public accounting for our cloud exit, it was based on five years of useful life from the hardware. But as this example shows, that's pretty conservative. Most servers can easily power your applications much longer than that.

Owning your own servers has easily been one of our most effective cost advantages. Together with running a lean team. And managing our costs remains key to reaping the profitable fruit from the business. The dollar you keep at the end of the year is just as real whether you earn it or save it.

So you just might want to run those cloud-exit numbers once more with a longer server lifetime value. It might just tip the equation, and motivate you to become a server owner rather than a renter.

About David Heinemeier Hansson

Made Basecamp and HEY for the underdogs as co-owner and CTO of 37signals. Created Ruby on Rails. Wrote REWORK, It Doesn't Have to Be Crazy at Work, and REMOTE. Won at Le Mans as a racing driver. Invested in Danish startups.