The Random Color texture is a Grayscale texture map that you can plug into a Gradient node to achieve random colors.
Figure 1: Random Color parameters
It creates quasi-random float values between 0 and 1 that are constant, but different for instances of the same Mesh. You can set random seeds to control the beginning of an instance chain. This is useful in modifying instance colors that have the same MaterialThe representation of the surface or volume properties of an object., such as simulating different shades of green of instanced trees in a common scene.
Figure 2: Random Color texture attached to a Gradient
Figure 3: Random Color results