WordPress.com Creator Raises $29.5M

Matt Mullenweg, founder of Automattic and creator of open-source blogging system WordPress, stopped by my apartment earlier this week. Matt, who is one of my closest friends, brought his Texan sense of humor and all-around good cheer, both of which were much needed following my little medical episode.
While we were chatting, he let it slip that Automattic had raised a whopping $29.5 million in a Series B Round of funding, including a strategic investment from The New York Times Co. Previous investors True Ventures, Polaris Ventures, and Radar Ventures also invested in this round. (Full disclosure: both Automattic and GigaOM are backed by True Ventures.) [digg=http://digg.com/tech_news/WordPress_com_Creator_Raises_29_5M]
Update: As part of this funding, some insiders including senior management whose options had vested were given an opportunity to cash out. The Wall Street Journal reports:

“Still, Automattic’s investors are taking pains to keep the company’s founders motivated: Some of the $29 million will be used to help company founders and others cash out some of their holdings in the private company, Mr. Black said. The practice has become more common in Silicon Valley as start-up founders spend longer building their companies without any payday.”

It is quite an event for the company, which began with Matt mucking around with code in his Houston bedroom. As one of the first adopters of WordPress, I got to know Matt well, yelling at him for not fixing bugs (which I still do) and always telling him what “features to add.” He took note of all it, and some of those features have actually shown up in the software. Eventually he moved out to San Francisco and started Automattic.
In recent months, Automattic’s premier offering, the free hosted blogging service WordPress.com, has started to grow by leaps and bounds. In addition to the 2.2 million blogs that it hosts (which generates, according to the latest trailing 30-day numbers from Quantcast, 42 million unique U.S. page views, 114 million global uniques and 482 million page views overall), WordPress.com is becoming an attractive option for media groups that don’t want to muck around with infrastructure. In addition to the GigaOM network of sites, CNN, Fortune and Fox are some of Automattic’s premier customers. Even more impressive (as far as I’m concerned) is that New York Yankees pitching star of the future, Phil Hughes, has a blog on WordPress.com as well.
So what does Automattic need the money for? After all, from what I know of the business, Automattic has been bubbling around the break-even point for a while now. Matt explains that they are going to roll out newer, hosted services such as BBPress (forums), and will expand their other product offerings, such as Gravatar and the spam-protection service Akismet. The money will be spent to hire more engineers and build out a more robust infrastructure.
That would be a start. Anne Zelenka made an impassioned case for using WordPress to build a social network, and I wouldn’t be surprised if we see some social features start to creep into WordPress.com as well. They just boosted their storage capacity to three gigabytes, which indicates that they are serious about allowing bloggers to add video and other multimedia content to their blogs.