GitHub finally raises funding: $100M from Andreessen Horowitz

GitHub is ready to take a huge step forward. After successfully bootstrapping its operation since 2008, the open-source code hosting site is set to announce Monday that it has accepted $100 million in funding from Andreessen Horowitz in order to improve and expand a platform that has become an industry standard for managing and finding code on the web.
The investment is the single largest by legendary venture capital firm Andreessen Horowitz to date, and is the first source of external funding that GitHub has accepted since it launched in 2008. Peter Levine, a general partner at Andreessen Horowitz, will join GitHub’s board.
The startup will use the funding to hire additional employees and expand to new platforms such as mobile.  CEO Tom Preston-Werner said the company hopes to develop new features but also improve existing ones, such as web applications for different operating systems. The idea is to make GitHub useful for a broad range of clients, from individual hackers to large enterprises, and from software developers to designers or authors.
In a blog post, Levine wrote that “it’s the largest investment we’ve ever made,” and explained why the firm decided to invest in GitHub:

They had a vision for a new way to develop software and created a new kind of company to pursue it. With only a handful of people in sales and marketing, the four grew the company to over 100 people, while growing revenue at nearly 300% annually—and profitably nearly the entire way.

GitHub’s site holds more than 3 million software repositories (co-founder and former CEO Chris Wanstrath once described it as “the Wikipedia for programmers”) and counts more than 1.7 million developers as users. On an average day, 80,000 repositories are updated and 7,000 individuals push their first repository to GitHub’s site, according to the company. Its open-source platform allows developers to work collaboratively on projects without losing any overlapping work, and look at code others are writing that has been posted to the site.
The funding marks a significant change for GitHub, which has prided itself on funding entirely through customers. In March, Wanstrath explained in an interview with GigaOM how this was important to the company’s mission:
“We’ve never raised any outside capital, so everything is bootstrapped. We started charging three months after our beta, so the whole time that GitHub has been alive, it’s been funded by its customers,” he says. “We really believe that the most important thing is making GitHub high quality. It has to be something that people are willing to pay for, because if they pay for it, we can keep working on awesome stuff.”
But Preston-Werner, who took over from Wanstrath as CEO a few weeks ago to lead the company’s new growth and let Wanstrath focus on product development, said the additional money will not change how GitHub operates, it will just allow them to hire the best programmers and develop ideas they already had in the works:
“In general, the money will allow us to take everything that’s already good about Github and crank it up to another level,” he said.
Barb Darrow has written for GigaOM how GitHub has become hugely popular among programmers or individuals looking for open source code online, allowing programmers to take advantage of existing code to create more efficient projects:

In the open source world, instead of writing everything from scratch, developers can mash up applications using code snippets that are already written and tested. That’s great from a productivity standpoint. And cloud computing eases deployment and distribution of those applications. Win, win.

Om has noted that GitHub has changed how programmers get hired, as the site provides an online platform for them to display what they know and how good their code is, a critical development as the war for programming talent in Silicon Valley grows:

I know of a dozen startup founders who regularly spend time on GitHub, looking for engineers and programmers they can add to their team.

GitHub is headquartered in San Francisco, but its workforce is distributed, with many of the company’s employees based around the world, Wanstrath explained to GigaOM in an interview in March:
“For designers and developers building a new creative product, we don’t believe that an assembly-type nine to five really makes any sense,” Wanstrath said. “We built a lot of GitHub at 1 a.m., so why should anyone here be different? It’s all about having high morale. We think that makes better products. If people are enjoying their work, they’re going to be more creative. They’re going to be thinking about it in the shower and it’s going to be a better end result for the people using it.”