
Automattic raises $300M at $3B valuation from Salesforce Ventures - jblz
https://techcrunch.com/2019/09/19/automattic-raises-300-million-at-3-billion-valuation-from-salesforce-ventures/
======
whalesalad
> “The roadmap is the same. I just think we might be able to do it in five
> years instead of ten,” Mullenweg said.

I tried to hunt for why the investment was taken and this is all the article
mentions. It just doesn’t make sense to me. I’m guessing that competition is
heating up and they need marketing fuel to keep people on the platform while
they transform it from a duct taped blogging tool to something more flexible.

There is no middle ground with WP. You’re either buying a generic theme that
doesn’t really fit your business and forcing your content into it... (every
small business out there right now) or you’re Rolling Stone and you run big
boy WP with major customizations. The middle area is weak. That’s where people
like Wix etc... are eating their lunch.

~~~
photomatt
Where it's possible, I'll always invest in product and engineering over
marketing (specifically external ad spend). The Tumblr acquisition is a good
example of that, we actually scaled back WP.com marketing in anticipation of
that to give more room to bring on Tumblr's entire 200ish-person team. 90%+ of
our growth is organic, and that percentage is going up.

~~~
gk1
Translation: We're actually doing well, but you only hear about Wix and others
because they spend more money on advertising than we do.

~~~
ksec
I wish I could stop having Wix ads on youtube, I have seen it like 500 times
already. While Squarespace is on all the information channel as sponsors.

I have yet to see a single ads on Wordpress.

Not necessarily a bad thing, but now whenever I think of doing a simple
website my brains clicks on Wix or SqaureSpace instead of thinking about
Wordpress.com

~~~
davidjnelson
Youtube premium removes video ads. Plus you can skip the product placement ads
if you want.

~~~
notatoad
(only if you live in countries where youtube premium is offered)

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AznHisoka
Does anyone else see a misalignment between the $3B valuation and the huge
impact Wordpress has had on the internet? 1/3 of all websites are powered by
Wordpress, yet they seem to be valued low compared to other tech companies.

~~~
tyingq
Pretty sure the vast majority of those WordPress sites bring them no revenue.

~~~
buboard
au contraire, i bet wordpress users make a lot more revenue than SV combined
(not a high bar - most SV startups lose money)

~~~
tyingq
Right, but they probably get close to zero from the self-hosted WordPress
users. The revenue is from people paying WordPress.com to host their sites.
That's the number of users that's relevant, and it's a much smaller number.
The self-hosted users that are the majority don't count for much.

~~~
dwd
On the self-hosted side they probably make a reasonable amount on premium
licensing for WooCommerce addons in the WooCommerce marketplace as well as
JetPack & Akismet.

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nathan-io
“What we want to do is to become the operating system for the open web. We
want every website, whether it’s e-commerce or anything to be powered by
WordPress."

God help us all.

~~~
shawnlower2
Better than Medium. Kanye West of the online publishing platforms. 'Pardon the
interruption, imma let you read this blog, but...'

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nshntarora
Awesome! @photomatt would also love to know the company's plans with
HappyTools ([https://happy.tools/](https://happy.tools/)), what's coming next?

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nathan-io
The article didn't mention the lack of version control, which AFAIK is
impractical due to the sheer amount of HTML and layout-defining configuration
WP stores in the db.

In spite of WP's revision history feature on Posts and other models, I've
always found this to be a major issue on WP sites.

Obviously there are numerous other problems with WP, that's just one I didn't
see the author touch on.

I try to talk clients out of WP whenever possible, and most let me build using
a proper MVC framework.

I like to think I'm making the Internet a little better, one not-another-
WordPress-site at a time.

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rblion
DHH isn't too thrilled about this.

> “We want every website, whether it’s e-commerce or anything to be powered by
> WordPress” is a nasty, monopolistic goal. Listening to Matt muse about 85%
> marketshare dreams is a real downer. But $300m is a down payment on monopoly
> dreams.

full thread:
[https://twitter.com/dhh/status/1174695189090308096](https://twitter.com/dhh/status/1174695189090308096)

~~~
neom
Guess he must hate Acquia is well? Not sure why DHH always has to be such a...
downer.

~~~
wp381640
because he has witnessed dozens of companies overtake his own in achieving
mega-valuations and success without following his cargo cult advice that was
born from a halo effect

his entire m.o today is to beat down anything that doesn't fit the poor and
loose thesis he built a brand on -- everything from "surveillance capitalism"
to "open source monopoly bad"

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njx
I am surprised nobody here mentioned wooCommerce and Gutenberg. Prior to
Gutenberg, I was sold on Elementor but now with the upgrade have been using
Gutenberg quite often and love it.

I bet the funding is going into these two fronts especially wooCommerce (the
top ecommerce platform on wordpress and also owned by Automattic.

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pX0r
Will things like WP (not in particular) die out eventually because of poor
developer experience ? Corollary: frameworks liked by developers will
eventually stick even if currently they have a modest userbase.

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pmlnr
I genuinely thought Automattic is already profitable, is it not?

~~~
smpetrey
Automattic _is_ profitable.

This funding round is less about securing long-term profitability and more
about long-term partnerships and scaling their portfolio of products[1] deeper
into other third-parties such as Salesforce (and beyond):

> “The problem we’re tying to solve is likely multigenerational. It can take
> the rest of our lives and we need to pass it on to the generation that comes
> after to continue to work on it. Hopefully for the rest of humanity because
> I can’t imagine a time when humanity cannot benefit from an open, free,
> connected web,” Mullenweg told me.

> When it comes to today’s funding round, Salesforce Ventures isn’t your
> traditional investor — and Mullenweg is well aware of that. There could be
> some partnerships and integrations between Salesforce and Automattic in the
> future.

[1] [https://automattic.com/about](https://automattic.com/about)

~~~
pmart123
Without looking heavily into it, it seems like given Wix is trading $6B in
public markets, why not try and IPO unless you believe there is a large
business synergy with Salesforce?

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neom
Whenever I see valuations like this from corporate VCs, I always wonder if
they're trying to protect against someone else buying the company.

~~~
photomatt
I hope that our fundraising history shows we wouldn't do a round that reduced
our business optionality in the future!

~~~
neom
I generally presume you're no fool Matt, hence it was just a wondering, no
offense intended of course. :)

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puranjay
Around three years back, if you were to ask me to build a website, I would
straight up choose WordPress. Not because it was the best at it, but because
it was the easiest and the cheapest way to do it.

Now, I'm not so sure.

Blogging itself is in decline and the kind of blogging experience WordPress
offers is, frankly, too bloated for the average blogger

~~~
tomnipotent
> Blogging

WP is a full-featured CMS and has been for over a decade.

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mwexler
Hopefully this means Simplenote will continue to be supported!

~~~
massel
I think Matt mentioned it on the Vergecast recently, so it's not a secret – we
have a team of top folks working on Simplenote and are continuing to invest in
it.

Source: I'm on the mobile team at Automattic and just spent a week hanging out
with the people working on it :)

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Aperocky
> We want all website to be ran on WordPress

The horror, it would be a worse disaster than npm. God no

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ravivyas
The keyword in the post is "e-commerce"

~~~
hazelnut
“e-commerce” does not directly come to my mind when I hear WP. Different story
with Salesforce.

So the question is - how does it fit together?

~~~
leviathant
Salesforce bought Demandware, which was built on Intershop, and while a
dominant force in ecommerce, it's also a stagnant one, sorely lacking on the
content front. There have been several attempts to fix this, and none are
keeping up with modern alternatives.

The admin for Demandware hasn't changed in years. Woo is nowhere near where
SFCC is in terms of functionality, but with this kind of investment, the folks
involved on the Automattic side are likely far more personally invested in
building out an ecommerce platform around WP, certainly compared to anyone
who's hired on to go spelunking in the Demandware codebase.

Look for a hosted, enterprisey take on WooCommerce in a couple of years.

------
calimac
Matt has been a special founder. He has integrity and a his compass is aligned
with a strong vision for product and the open internet.

The battle for an open internet is multigenerational Here a quote from the
article “The problem we’re tying to solve is likely multigenerational. It can
take the rest of our lives and we need to pass it on to the generation that
comes after to continue to work on it. Hopefully for the rest of humanity
because I can’t imagine a time when humanity cannot benefit from an open,
free, connected web,” Mullenweg told me

------
cft
As they get more and more funding, their content moderation is converging with
Facebook. This is from May:

[https://www.reddit.com/r/asktrp/comments/bn5gse/what_happene...](https://www.reddit.com/r/asktrp/comments/bn5gse/what_happened_to_heartistewordpresscom/)

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maxerickson
$160 million dollars is a ton of money. WTF.

~~~
notafrog
Edit: sorry, misunderstood.

~~~
maxerickson
The second paragraph of the article says they hadn't raised tons previously,
just $160 million.

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notzuck
"To that end, as we reviewed our hiring process, we realized that the
demographics of people we attract to apply are not inline with the
demographics of the people we hope to hire."

If that's there attitude then fuck them. You can guess which demographic they
are talking about.

~~~
human20190310
I googled the quote, and based on the context here [0], it seems like the
demographic being referred to is non-male.

What's wrong with reviewing hiring processes to determine if they're excluding
a demographic that contains individuals who would have done well in the role?

[0] [https://cate.blog/2019/05/15/addressing-hiring-gaps-
through-...](https://cate.blog/2019/05/15/addressing-hiring-gaps-through-user-
research/)

EDIT: The tl;dr for the article is that they're doing research on "how the
people you didn’t hire would have done".

~~~
notzuck
There's nothing wrong with reviewing your hiring processes to audit for
equality. Outright saying that you attract a demographic that you DO NOT WANT
TO HIRE FROM is a whole different level of problem. Might as well say no
blacks and irish. That whole quote could be associated with various different
ethnic groups over the years depending on the time it was written. in 2019,
that type of quote should not exist.

~~~
ceejayoz
> Outright saying that you attract a demographic that you DO NOT WANT TO HIRE
> FROM is a whole different level of problem.

That's not what was said. Nothing in that quote implies "we will hire zero
men".

~~~
notzuck
She literally said she gets applications from a demographic that she doesn't
want to hire from.... am I missing something here? You can't just say I have
too many Asians and therefore would prefer to have my applicants not be Asian.

~~~
ceejayoz
If she literally says that, please quote it.

~~~
notzuck
"we realized that the demographics of people we attract to apply are not
inline with the demographics of the people we hope to hire."

I already quoted....

~~~
ceejayoz
That quote does _not_ support your statement "She literally said she gets
applications from a demographic that she doesn't want to hire from...". She
did not literally (or even figuratively) say anything of the sort.

"We'd like a more diverse pool of applicants" does not mean "we'd like a pool
of applicants with _zero_ of <over-represented demographic> in it".

It doesn't even mean they want _less_ of that demographic at all. It can (and
likely should) be read as wanting a larger applicant pool overall, adding in
folks from demographics who simply aren't applying currently.

~~~
notzuck
"We'd like a more diverse pool of applicants" does not mean "we'd like a pool
of applicants with zero of <over-represented demographic> in it".

Are you sure about that? I don't think this is about equality at all. It's
about her and her agenda. Forcing people into your pipeline to meet a soft
quota is silly.

~~~
ceejayoz
> Are you sure about that?

Yes.

If I look at my garden, and I say "gee, it's all yellow flowers... I'd like
some red and purple ones, too", it's kinda nutty to think I'm saying "I'm
going to rip out all the yellow flowers and burn them".

~~~
notzuck
But you'll stop growing yellow ones so now when a yellow comes to your job
interview you may turn that flower down purely based on race which is wrong.
It's illegal to discriminate purely on someones race. If I would have
otherwise hired you but I 'need' more red flowers then that's bad.

