
Atlassian, AU company raises US60M, unheard of for Australian company - zzygan
http://www.smh.com.au/technology/enterprise/from-uni-dropouts-to-software-magnates-20100715-10bdh.html
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thesethings
I'm pretty ignorant about financing. I have a question for finance folks:

This company is about 8 years old, profitable since day one, and made 58
million last year in revenue.

I never hear about companies getting such a cash injection at this stage in
their lifespan. Perhaps I'm just primed for "things are different now" stories
after reading Fred Wilson's recent post on the topic (
[http://www.avc.com/a_vc/2010/07/some-thoughts-on-the-seed-
fu...](http://www.avc.com/a_vc/2010/07/some-thoughts-on-the-seed-fund-
phenomenon.html) tl;dr : "While many businesses require a lot less capital to
start, they don't require less capital to grow.").

But even by a new We Need to Grow yardstick, it seems Atlassian is mature.

What do you folks think?

~~~
ant5
This reminds me of Jive Software. They were in a very similar position when
they took money, in the same market, at a very similar level of maturity, and
one of the prime competitors to Atlassian.

I can't speak to the financial implications for their company, but as a
customer, the move was terrible. Their prices got jacked way up, they dropped
all their offerings in favor of what they saw as the product likely to provide
the highest return, invested a ton of that money in sales and marketing, and
their service and quality plummeted.

They switched to a subscription software licensing model, stopped listing
prices on their website, added a "Solutions" tab next to "Products", etc.

I never understood why they took the money, but I understood why those changes
came with the money. As a customer, I hope Atlassian doesn't go down the same
road, but given the amount of money and the actual scope of the products they
work on, I can't help think that it's an inescapable path.

~~~
scottfarkas
As the founder of the company, I'd like to say that we don't plan on any
changes to the business model or pricing.

We've grown Atlassian 3x over the last 3 years, all by following our current
model of reasonable, transparent pricing, and selling in volume to thousands
of customers around the globe.

There are things we want to improve of course (around our products - we're
never done with improving them), but we don't plan to change our model.

We spoke at great length with Accel Partner about this. They like us for what
we are, not what we could be if we changed.

~~~
ant5
Hi Scott --

Thanks for replying. Congratulations on the investment, and I hope this works
out for you and your company.

However, in my experience, nobody gives you $60 million (or $6 million)
dollars and doesn't expect to have their finger in the pie. Everyone -- CEOs,
the board, the investors themselves -- _always_ says that they don't want to
change a thing about a company, but how can you really avoid a shift in
incentives when you hand over a board seat and start spending other people's
money?

Whether or not that priority shift will be a good or bad thing is relative to
who is asking. Often, there's surprisingly little alignment between what is
good for the founders, the customers, the employees and the investors.

Regardless, I wish you all the best, hope you can keep doing things the way
you want them to get done, and hope we can continue as Atlassian customers.

------
Smerity
I'm glad to hear they're continuing to do so well. Atlassian is one of the
great Australian IT success stories - I really hope the government and people
see them as a shining example of IT in Australia and why the industry should
be further encouraged.

They're also quite generous to a number of causes. They sponsor the Sydney
University IT Society and NCSS (which is a summer program in computing for
talented high school students) and commonly come and give talks to the local
universities on a wide range of topics (technical and entrepreneurial). They
also provide free software for open source projects and host the local Java
User Groups.

Overall I really do have a fond spot for them, even if they work in Java ;)

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pchristensen
This is what Joel Spolsky was worried about a while back.
[http://www.inc.com/magazine/20091101/does-slow-growth-
equal-...](http://www.inc.com/magazine/20091101/does-slow-growth-equal-slow-
death.html)

~~~
bl4k
_I had to wonder. We do have a large competitor in our market that appears to
be growing a lot faster than we are. The company is closing big deals with
big, enterprise customers. And the wheels are falling off the donkey cart over
there as the company stretches to fulfill its obligations. Meanwhile, our
product is miles better, and we're a well-run company, but it doesn't seem to
matter. Why?_

For those of you who might have missed the reference, Spolsky is referring to
Atlassian here, even though he doesn't mention them directly by name (not sure
why he didn't - perhaps he was still in the denial phase)

------
dmharrison
Good to see the Australian tech sector has some life. The thing I found most
interesting was that they bootstrapped off their credit card.

------
wallflower
Title is incorrect. My large company has been using Atlassian software for
years (Confluence, Jira). They are not a startup anymore.

~~~
zzygan
True, they're not a startup anymore really, I've updated the title a bit.

The story does talk about the founding of the company though

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obiefernandez
Has the usability of Confluence and Jira improved over the years? Those were
key products in use at ThoughtWorks when I was there about 4-6 years ago. I
can tell you that most people hated working with them.

~~~
goodside
A few months ago, I wanted to insert a double backslash into a Confluence wiki
page. This isn't as odd as it sounds; Windows network file paths begin with
\\\Foo\\. Since backslashes are of course an escape char, you usually have to
use \\\\\\\ to get \\\ to output. But, in Confluence, this outputs two
newlines. Yes, double-backslash is the symbol for a newline.

Counter-intuitive, yes, but no worse than that so long as there's another
symbol you can use for when you do need a double-backslash. But, the thing is,
there isn't. When Confluence was first designed, they used up their _only_
escape char with their nonstandard newline symbol. This is, their support
staff informed me, a deep-rooted and unchangeable aspect of how Confluence
works. It's not a bug, because it will never be changed.

This should give you the gist of what Atlassian is like.

~~~
daredevildave
They must have fixed something, because in our Confluence wiki:

    
    
      \\ -> new line
      \\\\ -> \\\\
      \\Foo -> Foo
      \\Foo\Bar -> \\Foo\Bar
    

Somewhat errant result for \\\Foo, but the other ones seem to work.

~~~
goodside
The \\\Foo\ example I gave was poorly chosen, because they put in a kluge fix
so that anything that resembles a Windows file path will pass through
unparsed. You cannot use \\\ in any other circumstance, which is why \\\Foo
failed.

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gojomo
They have a significant SF office, as well, by my understanding.

~~~
daveoflynn
Yup. 60-odd folks there, though the majority of the engineering crew are still
in Sydney.

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i386
As an employee its very exciting. Welcome to the team Accel!

~~~
pufuwozu
I'll be starting as a Graduate Developer (in Sydney) next year. It should be
fun be part of Atlassian and watch it expand.

~~~
i386
Welcome aboard - looking forward to having you here. Any idea what team Talent
have placed you in?

~~~
pufuwozu
Don't know yet - there's still about 7 months to go so it's not a big rush.
You'd know more than me - but judging from the direction of the Summit
announcements I'm guessing it'll be a Dev Tools team.

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larrywright
This seems odd to me. I've looked at their products in the past, and they
certainly aren't giving them away for free. I can't imagine they're not
profitable, so what would they need this kind of money for?

~~~
pufuwozu
Mainly expansion.

It looks like Atlassian is planning to use the money on getting more into
Europe and Asia; getting some more acquisitions and giving some liquidity to
employees.

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mkramlich
well, they have a real product and real paying customers. that goes a long way
I hear.

