Salad Technologies Revenue, Valuation & Funding (2024)

Salad Technologies generated approximately $150,000 in revenue in 2020, its first meaningful commercial year. By late 2021, the company had reached a $5 million annualized run rate, with year-to-date top-line revenue of slightly more than $3 million, representing growth of roughly 20 times year over year.

Salad Technologies operates a two-sided marketplace and Miles drew a clear distinction between its suppliers and its customers. On the supply side, the network had approximately 20,000 daily active users contributing GPU compute at the time of the interview. Miles did not classify these contributors as customers because they supply the product rather than pay for it.

On the demand side, the primary paying customers as of late 2021 were Web3 cryptocurrency networks. Salad mined half a dozen to a dozen different protocols on behalf of those networks, which paid the company for access to its pooled compute. Miles described this arrangement as the company's solution to the classic two-sided marketplace cold-start problem, allowing Salad to focus on growing the supply side without needing to simultaneously build enterprise demand.

For contributors, the cost of running a Salad node adds roughly $5 to $15 per month to a household electricity bill. Miles noted that his own computer generates approximately $60 to $65 per month in Salad Balance, implying a net benefit of $45 to $60 per month for an active contributor. Pricing for rewards varies by item; a $40 Amazon gift card costs $50 in Salad Balance, reflecting the company's average 23 percent blended marketplace margin.

Salad Technologies earns revenue by acting as custodian of the value its network generates and capturing margin when contributors redeem their balances. The company gives contributors 100 percent of the compute value their machines produce, expressed as Salad Balance, but that balance can only be spent through Salad's own storefront. The markup between the wholesale cost of rewards and the Salad Balance price charged to contributors is the company's primary margin mechanism, averaging 23 percent across all reward categories.

A secondary revenue source is breakage. Miles explained that 18 percent of outstanding Salad Balance belongs to accounts that have not logged in for six months or more. The company has not yet recognized that balance as revenue, but it represents a latent asset on the books. A third stream comes from mining cryptocurrency protocols directly on the network, where Salad earns income from the Web3 networks it serves.

Gross margin across the business was 23 percent as of 2021, consistent with the marketplace take rate Miles described. The company held $2 million in cash at the time of the interview. Miles positioned the current model as a transitional phase, with a longer-term ambition to sell compute capacity directly to enterprise and Fortune 500 clients at rates approximately one fifth the cost of an AWS spot instance on a per-teraflop-per-hour basis. Profitability was not discussed in the interview.

Salad Technologies employed 25 people in total as of November 2021, comprising 19 full-time staff plus a support team of six. The engineering function had just grown to eight engineers at the time of the interview, up from seven immediately prior. Miles cited the Series A raise as the catalyst for planned team expansion, noting that Fortune 500 compute workload opportunities were driving the need for additional headcount.