[kenrose]

You're not wrong to think Tailscale is primarily a software company, and yes, salaries are a big part of any software company's costs. But it's definitely more complex than just payroll.

A few other things:

1. Go-to-market costs

Even with Tailscale's amazing product-led growth, you eventually hit a ceiling. Scaling into enterprise means real sales and marketing spend—think field sales, events, paid acquisition, content, partnerships, etc. These aren't trivial line items.

2. Enterprise sales motion

Selling to large orgs is a different beast. Longer cycles, custom security reviews, procurement bureaucracy... it all requires dedicated teams. Those teams cost money and take time to ramp.

3. Product and infra

Though Tailscale uses a control-plane-only model (which helps with infra cost), there's still significant R&D investment. As the product footprint grows (ACLs, policy routing, audit logging, device management), you need more engineers, PMs, designers, QA, support. Growth adds complexity.

4. Strategic bets

Companies at this stage often use capital to fund moonshots (like rethinking what secure networking looks like when identity is the core primitive instead of IP addresses). I don't know how they're thinking about it, but it may mean building new standards on top of the duct-taped 1980s-era networking stack the modern Internet still runs on. It's not just product evolution, it's protocol-level reinvention. That kind of standardization and stewardship takes a lot of time and a lot of dollars.

$160M is a big number. But scaling a category-defining infrastructure company isn't cheap and it's about more than just paying engineers.

[kortilla]

> but it may mean building new standards on top of the duct-taped 1980s-era networking stack the modern Internet still runs on.

That’s a path directly into a money burning machine that goes nowhere. This has been tried so many times by far larger companies, academics, and research labs but it never works (see all proposals for things like content address networking, etc). You either get zero adoption or you just run it on IPv4/6 anyway and you give up most of the problems.

IPv6 is still struggling to kill IPv4 20 years after support existing in operating systems and routers. That’s a protocol with a clear upside, somewhat socket compatible, and was backed by the IETF and hundreds of networking companies.

But even today it’s struggling and no company got rich on IPv6.

[kenrose]

Totally fair to bring up IPv6 vs. IPv4. However, I think Tailscale’s approach might sidestep some of that pain.

Avery (Tailscale CEO) has actually written about IPv6 in the past:

    - https://apenwarr.ca/log/20170810 (2017)
    - https://tailscale.com/blog/two-internets-both-flakey (2020)

IPv6 has struggled in adoption not because it’s bad, but because it requires a full-stack cutover, from edge devices all the way to ISP infra. That’s a non-starter unless you’re doing greenfield deployments.

Tailscale, on the other hand, doesn’t need to wait for the Internet to upgrade. Their model sits on top of the existing stack, works through NATs, and focuses on "identity-first networking". They could evolve at the transport or app layer rather than rip and replacing at the network layer. That gives them way more flexibility to innovate without requiring global consensus.

Again, I don’t know what their specific plans are, but if they’re chasing something at that layer, it’s not crazy to think of it more like building a new abstraction on top of TCP/IP vs. trying to replace it.

[lo0dot0]

Yes, a move to static IPv6 addresses everywhere would help a lot.

[croemer]

At least tailscale funnel isn't control-plane-only, unless I'm totally misunderstanding something