Varnish is an HTTP accelerator to speed up a server, especially during times when there is high traffic to a site. It works by redirecting visitors to static pages whenever possible and only drawing on the server itself if there is a need for an active process.
Varnish is a cache which stores copies of pages for users that aren’t logged in (most readers aren’t). When requests come in to your server, Varnish returns these pre-built pages instantly rather than requiring Apache, PHP and WordPress to rebuild the page for each request.
Memcached is a caching system that works by temporarily storing information in memory that would usually be retrieved from a database. The next request for the in-memory information is then incredibly fast without putting stress on the backend database.
Use Varnish & NGINX to Serve WordPress over SSL & HTTP: https://www.linode.com/docs/websites/varnish/use-varnish-and-nginx-to-serve-wordpress-over-ssl-and-http-on-debian-8/