Automattic for the Money ($29.5M to be Exact)

Picture 8
Now, it all makes sense.

Now, I understand why Automattic came out of nowhere earlier this week with an ultra-aggressive strategic move to increase bandwidth for Wordpress.com users to 3GB – a move that will likely force rival TypePad to follow suit.

According to GigaOm, Automattic and blog/boy wonder Matt Mullenweg has raised $29.5-million from a group of investors that includes The New York Times.

I’m not sure how I feel about the NYT becoming an investor in Automattic/Wordpress. On one hand, it seems strange to have a traditional media organization have a stake in Wordpress. I mean, come on, this is Wordpress – the open-source project that we all know and love, right!

On the other hand, it is the NYT – one of the best media organizations in the world and an enthusiastic Wordpress user. (About.com guides are published using Wordpress, and the NYT has more 50 Wordpress-powered blogs.)

So, what does Wordpress do with all that dough other than buying a few more servers and upgrading its Akismet anti-spam service?

Does this signal a major change in how Automattic deals with Wordpress and the fee-based services it offers. My sense is we can expect the “ah shucks, we’re Wordpress” approach to change as Automattic becomes a serious business looking for serious revenue.

And maybe it’s time for Automattic to be looking at some serious acquisitions. A solid publishing tool would be a start. Who knows, maybe Automattic will get into the online advertising business given it generates so much traffic and has such a strong brand. GigaOm suggests that Automattic could also launch a social networking business. With $29.5-million in the bank, the company has the ability to do some interesting deals.

All in all, there are interesting times ahead for Automattic and Wordpress. If I were TypePad (and maybe Blogger), I’d be very worried.

For more, check out Mullenweg’s blog.

Update: The financing values Automattic at $150-million to $200-million. Some of the money will be used to cash out some of the company’s investors – CNet being one of them.

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8 Comments

  1. Posted January 23, 2008 at 7:12 pm | Permalink

    I searched your site to see if I could find previous posts on what you would consider a serious publishing tool and how it would fit into our offerings, but wasn’t successful. What do you mean by a serious publishing tool? Thank you.

  2. Posted January 24, 2008 at 9:55 am | Permalink

    What I meant was something like Ecto – a publishing tool with that’s a lot more user-friendly and feature-rich than Wordpress’ publishing tool.

  3. Posted June 12, 2008 at 11:52 am | Permalink

    Thanks for mentioning Ecto… I have been looking for something like that for a while, its far better than wordpress in my opinion. I know you pay for it but its far better if you are taking online publishing seriously.

  4. Posted January 20, 2009 at 4:41 pm | Permalink

    of blogging platform WordPress (which BloggerTalks incidentally uses) by Matt Mullenweg, have raised another $29.5m in funding, with The New York Times opening its wallet. Matt himself have a post up,

  5. Posted February 6, 2009 at 2:55 am | Permalink

    I searched your site to see if I could find previous posts on what you would consider a serious publishing tool and how it would fit into our offerings, but wasn’t successful. What do you mean by a serious publishing tool? Thank you.

  6. Posted April 28, 2009 at 10:10 am | Permalink

    What I meant was something like Ecto – a publishing tool with that's a lot more user-friendly and feature-rich than Wordpress' publishing tool.

  7. Posted May 8, 2009 at 9:11 am | Permalink

    Thank you for this informative read, I really appreciate sharing this great post. Keep up your work.

  8. Posted July 11, 2009 at 4:00 pm | Permalink

    Well, if NYT can have a piece of WordPress it will surely move people to Joomla, which I believe is open source also.

5 Trackbacks

  1. [...] Coverage at TechCrunch, Mark Evans, Mathew Ingram, The Blog Herald, Photo Matt and Toni Schneider. addthis_url = [...]

  2. [...] of blogging platform WordPress (which BloggerTalks incidentally uses) by Matt Mullenweg, have raised another $29.5m in funding, with The New York Times opening its wallet. Matt himself have a post up, [...]

  3. By Breaking Out Blogger “Pay” | Mark Evans on May 29, 2008 at 7:13 am

    [...] of bloggers with its comment service. A Wordpress-Disqus deal makes sense given Wordpress has lots of cash to make acquisitions, and Disqus is a cool service with, to date, no business plan. For more on [...]

  4. [...] rise as the blogging platform and Automattic’s emergence as a venture-back entity ($29.5-million in the last round from investors such as the New York Times), Mullenweg still seems the same guy [...]

  5. By How does affiliate marketing work? on July 11, 2009 at 12:01 pm

    [...] How does affiliate marketing work?  href [...]

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