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So, with this $100M, they can really dominate the code hosting market?

There's a reasonable case to be made that they're either going to or already dominate the code hosting market anyways, depending on how big you define it. The only way $100M makes sense is if they're expanding into one or multiple other things.

Well, a natural focal point is enterprise. I could imagine (this is pure speculation) that there are a number of fairly cumbersome features holding back some large enterprise customers, but which has been de-prioritized in favor of the cloud product where gains are more immediate and viral. In general, there are probably many teams holding back on GitHub because of some missing feature which didn't make sense to build while they were bootstrapped.

And then, yes, there's expanding into adjacent verticals. They're already there with wikis and issue tracking, so it's not a virgin territory strategy.

I agree with your assessment. Deploying into enterprise takes a good chunk of money to deal with the countless "last mile" issues. Also, you start needing an enterprise sales team. Even if you use the Atlassian model, there's limited space for that now, because they were basically expanding into vacuum. I don't have a great sense of how big the available market is for "enterprise development management tools", but if Github wants to win there, it's going to have to put some marketing & sales resources into taking away mindshare from Atlassian.

Thinking too small - for a $100M raise to make sense, valuation has to be $1B or higher, and need a 10x total market for VCs to be interested. So $10B to $100B is the target, and they need very large goals to justify it.

[Edit - I guessed $1B-$10B valuation; WSJ says unnamed source cites $750M. If true, congratulations to A16Z, they got a steal.]

Most of github's mission is removing friction in collaboration around code.

Following this theme, likely expansions: removing transactional overhead to add liquidity to the development market ( http://en.wikipedia.org/wiki/Coase_theorem ) which is badly inelastic in the face of great demand. Less audacious, they may just domainate the recruiting market.

Still on the theme, continuing to push on the need to colocate to be productive - online editing, tools in support of code review, user testing, in-app feedback, platform building/distribution.

Build farms, integration tooling, and support markets also seem plausible but more difficult to see (in the current market) how they could get sufficient uptake to justify the target valuation.

One more, less optimistic: IP/patent/code provenance - lots of money attached to those things.

Not sure why an enterprise would want to host their source code at a separate company when it is just as easy to host their own source control system (git, mercurial, tfs, whatever) with their other cloud services (S3, Azure). I do not think enterprises see their source as a "social" connection, and do not see any benefit to thinking of it as such.

1: GitHub Enterprise is an internally hosted solution. They currently distribute it as a VM image.

2: GitHub >>> git

3: Enterprises very much love social in anything they do, they just call it collaboration. See Sharepoint. Also, the pressure from within to use something like GitHub is only going to increase as new hires have experience with it from the outside.

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