[SGVLUG] Andreessen Horowitz drops a cool $100m on... what??

[John Kreznar]

http://blogs.ft.com/tech-blog/2012/07/andreessen-horowitz-drops-a-cool-100m-on-what/

Andreessen Horowitz drops a cool $100m on... what??

   July 10, 2012 1:47 am by Richard Waters

   The biggest investment yet made by Silicon Valley's most-talked
   about new venture capital firm is in a start-up most people have
   never heard of.

   But if you work in open-source software development, then GitHub is
   quickly turning into an essential utility - which explains why this
   mix of social network and content management system could be a
   model for how to make money from distributed online communities.

   Andreessen Horowitz has just staked $100m on GitHub's central role
   in helping teams of developers to collaborate on code.  That values
   the four-year-old company at $750m, according to a person familiar
   with the financing, and is twice as much as AH put into Skype,
   which was the most prominent investment success in its first three
   years.

   Linus Torvalds gave the name Git to the management system he used
   to organise Linux source code, and the name has stuck.  GitHub, set
   up in 2008, has become a centralised hub for managing a wide range
   of open-source projects, while also handling a growing number of
   commercial code bases.

   Developers don't just flock to it for its cloud-based code
   repository and management tools, though.  As one engineer tells us:
   "It is the most powerful recruiting tool on the planet for
   engineers."

   Posting code to the site has become a way for developers to show
   off their work, build a personal following - and get a better job.
   This has helped to turn it from practical tool to social phenomenon
   in a specialised global community, with nearly 1.8m people using
   the site to host their code.

   It's a formula that might well work in other areas, chief executive
   officer Tom Preston-Werner tells us.  That's part of the expansion
   GitHub has in mind following its first outside financing: writers,
   designers and project managers could all use collaborative tools
   like this, he predicts.

   GitHub is a classic "freemium" business, charging nothing for
   keeping open-source code in public repositories.  Fees for using
   private repositories and tools for organising teams range from
   $7-200 a month.

   It also makes money from job advertising and has a nascent training
   business, teaching developers how to convert their projects to its
   distributed development approach.

   A social network with diversified revenue streams that meets both
   its users' business and personal career needs? That sounds just
   like LinkedIn, which has become the stand-out from last year's crop
   of internet IPOs (and is now judge by Wall Street to be worth more
   than former shooting stars Zynga and Groupon combined).


-- 
OpenPGP key: http://ininx.com
 John E. Kreznar jek at ininx.com 9F1148454619A5F08550 705961A47CC541AFEF13

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