Docker’s So Hot It Just Got $40M It Won’t Start Spending Until Next Year

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How hot is Docker? So hot it’s getting money from VCs it doesn’t even really need right now. The company announced $40M in funding today, but CEO Ben Golub says they won’t actually start spending the new funds until at least late next year.

In fact, the company runs so lean, it is only just now dipping into the $15M it got at the beginning of this year, but when funders offer you that kind of dough you don’t turn it down. Golub said the money helps show the market that the company has stability and is in it for the long haul.

“We won’t be touching it until late next year or early the following year. Knowing we have it, we can scale appropriately this year and it sends a message to the market we’re not just trying to build quickly and sell it,” he explained. He said they were in it for the long term.

“Every real entrepreneur wants to build a company that can go all the way. We have so much support from the community and investors and employees, we want this thing to reach full potential,” he said. He added, “Investors aren’t looking for a quick exit. They are looking to build something meaningful.”

One of the reasons the company can afford to spend so wisely, is that it runs so lean. It relies on partners to act as its sales and marketing organization, and whatever they’re doing, it seems to be working–it relies on a community that has grown to 600 contributors to help with development. In addition, there are 35,000 apps built on top of Docker in its app store, and these tools help fill in gaps in the core product.

While Golub admits he loses some control by working this way, he says overall the trade-offs are well worth it, and it’s hard to argue with the results to this point. “To some extent we have to lead by example and create the right kind of structure for the partner sales and community development to succeed. If you are open source, you have to be comfortable with the idea you don’t control everything but the momentum and diversity compensates for the fact you aren’t totally in control,” he explained.

In reality, Docker has a great deal of control over the project, producing about 80 percent of the code and acting as chief maintainers of the project, but Golub says the community adds a high level of value and acts as a reality check for the company’s core developers, while pointing them in directions they might not have gone on their own.

Conversely, he says, if the company is trying to move in a certain direction and the community is fighting them, there’s a good chance they’re moving in the wrong direction. He says the community also drives edge cases they couldn’t deal with because there are so few of engineers right now in-house and they test the product at a scale that would be impossible for them to do in-house.

This funding round is Series C and is led by Sequoia Capital along with Benchmark Capital, Greylock Partners, Insight Ventures, Trinity Ventures, and Yahoo! founder Jerry Yang. It brings the total to date for the company as Docker, Inc. to $65M. Before that they were known dotCloud, which the company sold to cloudControl in August.

Docker builds a delivery container for the modern app. As Golub pointed out, five years ago most applications used to exist a long time, were monolithic and lived on a single server. All that has changed today. Applications tend to be made up multiple components often spread across many servers that change all the time. Docker containers (as they are called because they hold the contents of the application) are designed to help developers build, run and ship these kinds of distributed applications.

Golub says the product was built for developers by developers and this approach has paid off so far. Judging from the results to this point , it’s hard to argue.

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