Managed Nebula vs IPsec

Managed Nebula and IPsec represent very different generations of secure networking. IPsec is a protocol suite built into most operating systems for creating site-to-site and remote access VPN tunnels. Nebula is a modern mesh networking platform designed to replace the complexity of IPsec with something simpler, more flexible, and easier to manage at scale.

Nebula is a fully open-source overlay networking tool that we originally built at Slack and continue to maintain at Defined Networking. It uses its own protocol built on the Noise framework to create peer-to-peer encrypted tunnels between hosts. Managed Nebula is our cloud-hosted management layer that handles certificate authorities, host configuration, and distribution, while you retain full control of your network’s data plane.

IPsec (Internet Protocol Security) is a protocol suite standardized by the IETF for securing IP communications. Common implementations include strongSwan, Libreswan, and the built-in IPsec stacks in most operating systems and network hardware.

Below, we break down the key differences to help you decide which is right for your network.

	Managed Nebula	IPsec
Topology	Peer-to-peer mesh	Site-to-site or remote access
Protocol	Nebula (Noise IX)	IKEv2/ESP (multiple cipher suites)
Configuration	Minimal, certificate-based	Complex, many parameters
Authentication	Certificate-based (Nebula CA)	Pre-shared keys or certificates
Firewall	Stateful with security groups	Separate from tunnel config
NAT traversal	Automatic via Lighthouses	NAT-T (UDP encapsulation)
Mesh support	Built-in, automatic	Manual per-pair configuration
Open source	Fully (MIT license)	Multiple implementations
Free tier	Up to 100 hosts	Free (self-managed)
Pricing	$1/host/month	Free (operational cost only)

Nebula creates a mesh network where every host can communicate directly with every other host. Adding a new host requires signing a single certificate. The new host can then reach any other host on the network without additional configuration. The data plane is fully decentralized. If our control plane goes offline, your existing network continues operating normally.

IPsec creates point-to-point tunnels between pairs of endpoints. Building a mesh with IPsec requires configuring a tunnel between every pair of sites or hosts. For N sites in a full mesh, that means N*(N-1)/2 individual tunnel configurations, each with its own security associations, policies, and routing rules. Most organizations avoid full-mesh IPsec and instead route all traffic through a hub site, creating the same bottleneck and single-point-of-failure problems as traditional VPNs.

This is where the difference is most dramatic.

Nebula configuration is minimal. A host needs a certificate (signed by the Nebula CA), the CA certificate, a list of lighthouses, and firewall rules. Managed Nebula handles certificate generation and configuration distribution automatically. A typical Nebula config is under 30 lines.

IPsec configuration involves selecting cipher suites, configuring IKE phases (phase 1 and phase 2), defining security policies, setting up security associations, configuring routing, handling NAT traversal, and managing pre-shared keys or certificates across all endpoints. A typical site-to-site IPsec configuration can be hundreds of lines, and every pair of endpoints needs its own configuration. Debugging IPsec issues (phase 1 vs phase 2 failures, cipher mismatch, policy mismatch, NAT-T issues) is notoriously difficult.

Nebula has a stateful packet firewall built directly into the Nebula process. Firewall rules reference groups embedded in certificates, working similarly to AWS Security Groups. Rules are simple, declarative, and don’t need to change as hosts join or leave.

IPsec has no built-in firewall. Access control must be implemented using separate firewall rules (iptables, nftables, pf) that reference IPsec policies and security associations. These firewall rules must be maintained independently on each endpoint and updated as the network changes.

Nebula handles NAT traversal automatically through Lighthouses. Hosts register with Lighthouses on startup, and when two hosts need to connect, they use the Lighthouse to coordinate NAT hole-punching. For difficult NAT situations, Nebula supports relays that you operate.

IPsec supports NAT traversal through NAT-T (NAT Traversal), which encapsulates ESP packets in UDP. While this works, it adds configuration complexity and can cause issues with some NAT implementations. Many IPsec deployments require static public IP addresses or port forwarding to work reliably.

Nebula is fully open-source under the MIT license. Every component is available for inspection, modification, and self-hosting.

IPsec has multiple open-source implementations (strongSwan, Libreswan, OpenBSD’s isakmpd) as well as proprietary implementations in commercial firewalls and routers. The protocol itself is an open standard, but implementations vary in features, configuration syntax, and interoperability.

Managed Nebula offers simple per-host pricing:

• Free: Up to 100 hosts, 2 routes, SSO, and a simple management UI. No credit card required.
• Pro: $1/host/month with unlimited hosts, up to 100 routes, priority support, and guaranteed uptime
• Enterprise: Custom pricing with a dedicated Slack support channel and network design assistance

See our pricing page for full details, or contact sales for Enterprise.

IPsec itself is free, but the operational cost of managing IPsec at scale (configuration, debugging, key management, monitoring) is significant. Commercial IPsec solutions (Cisco, Palo Alto, Fortinet) carry their own licensing costs.

Choose Managed Nebula if you want:

• A mesh network that scales without exponential configuration growth
• Simple configuration that takes minutes, not hours
• Automatic NAT traversal and peer discovery
• Built-in, group-based firewall rules on every host
• Certificate-based authentication with a managed CA
• A network that keeps working even if the management plane goes down

Choose IPsec if you want:

• Compatibility with existing network hardware (routers, firewalls)
• A standard protocol required by compliance or regulatory frameworks
• Kernel-level encryption on platforms where this is required
• Integration with existing enterprise firewall and router infrastructure