Q2 2016 ‘Dev-Native’ Funding Roundup
We’re halfway through 2016 and funding for dev-native(1) companies is up more than 12% over the same record-breaking period last year; this despite the broader venture climate appearing to cool.
Just about $924 million was invested across 44 dev-native companies, representing flat growth over Q2 of last year but 67% growth over the previous quarter. Meanwhile, the sheer number of investments — 44 — was the highest on recent record, illustrative of the fact that a disproportionate amount of new ventures are targeting the developer either as an end-market or go-to-market.
In Q2, those companies that helped developers write and collaborate around code (‘Developer Productivity’) and those that helped get code from developers’ terminals into production (‘Software Lifecycle Management’), saw 70% of the $924 million total invested come their way. This is all symptomatic of the broader trend of companies reshaping themselves into software-driven organizations and requiring the proper tooling to do so.
Highlights from Q2 ’16 funding include:
- Developer productivity staying hot with Slack raising a monstrous $200 million Series F and InVision stuffing the coffers with a $55 million Series D.
- Little-known SaaS infrastructure monitoring platform, LogicMonitor raising a whopping $130 million growth round.
- Microservices infrastructure funding remaining strong with CoreOS raising a $28 million Series B, Rancher Labs raising a $20 million Series B and Weave raising a $15 million Series B.
- Banking API Plaid landing a $44 million Series B.
- CircleCI, leaders in continuous delivery, closing a $18 million Series B.
However, the biggest dev-native announcement in Q2, came out of the public markets, as Twilio — a poster-child for Services-as-Code businesses — priced a highly successful IPO (note: Redpoint is an investor in Twilio). The company, which provides APIs for voice, messaging, video and authentication, finished up over 90% on its first day of trading and is up nearly 150% on its original issue price. Twilio was the first venture-backed technology new issue of 2016, following on the heels of fellow dev-native darling Atlassian, which IPO’d in December ‘15.
While many tech new issues over the last couple years have languished in the public markets, Twilio, Atlassian and New Relic are all up at least 30% since their respective offerings, demonstrating that public market investors are placing premium on efficient, high-velocity go-to-market approaches that are emblematic of these companies. Let’s keep it going!
(1) Dev-native refers to a company whose a) primary product or service offering is delivered in the form of code or in the form of software that facilitates the creation of code and/or b) who targets the developer as an end-market or as a channel into the enterprise. Within the dev-native stack we’ve there four distinct taxonomies:
- Developer Productivity (DP) — Tools that help developers write and collaborate around code. Examples include language frameworks and libraries, development environments, source code management, collaboration and project management platforms.
- Software Lifecycle Management (SLM) — Tools that test, deploy, manage and monitor code across dev, test/QA and production environments. Examples include build automation, continuous integration and delivery platforms, test and QA software, application performance monitoring, and infrastructure monitoring.
- Infrastructure-as-Code (IaC) — Emulated, programmable compute, storage and network resources responsible for executing logic and running and scaling applications. Examples include virtualized infrastructure, databases, operating systems, container engines, cluster management, configuration management,
- Services-as-Code (SaC) — Products and services that are instantiated in code and delivered via APIs and SDKs. Examples include communications (Twilio), payments (Stripe), business intelligence (Segment), commerce (Shopify), mapping (Mapbox), banking (Plaid) and many others.