Docker, the company that did more to create today’s modern containerized computing environment than any other independent company, has raised $92 million of a targeted $192 million funding round, according to a filing with the Securities and Exchange Commission.
The new funding is a signal that while Docker may have lost its race with Google’s Kubernetes over whose toolkit would be the most widely adopted, the San Francisco-based company has become the champion for businesses that want to move to the modern hybrid application development and information technology operations model of programming.
To understand the importance of containers in modern programming it may help to explain what they are. Put simply, they’re virtual application environments that don’t require an operating system to work. In the past, this type of functionality would have been created using virtual machines, which included software and an operating system.
Containers, by contrast, are more efficient.
Because they only contain the application and the libraries, frameworks, etc. they depend on, you can put lots of them on a single host operating system. The only operating system on the server is that one host operating system and the containers talk directly to it. That keeps the containers small and the overhead extremely low.
Enterprises are quickly moving to containers as they are looking to improve how they develop and manage software — and do so faster. But they can’t do that alone and need partners like Docker to help them make that transition.
What many people miss is that Docker is far more than the container orchestration layer — Kubernetes won that war — but a full toolchain for building and managing those containers.
With every open-source project, technology companies are quick to adopt (and adapt) the open-source project and be well-versed with how to use it. More mainstream big businesses that aren’t quite as tech-savvy will turn to a company like Docker to help them manage projects developed with the toolkits.
It’s the natural evolution of a technology startup that serves big business customers to become uninteresting while they become more profitable. Enterprises use them. They make money. The hype is gone. Because once a company sells to a big enterprise customer, they stick with that vendor forever.
… Docker has quietly transformed into an enterprise business with explosive revenue growth and a developer community in the millions, under the leadership of our CEO, the legendary Steve Singh. Our strategy is simple: every large enterprise in the world is preparing to migrate their applications and infrastructure to the cloud, en masse. They need a solution to do so reliably and securely, without expensive code or process changes, and without locking themselves to a single operating system or cloud. Today the only solution meeting these requirements is Docker Enterprise Edition. This puts Docker at the center of a massive growth opportunity. To take advantage of this opportunity, we need a CTO by Steve’s side with decades of experience shipping and supporting software for the largest corporations in the world. So I now have a new role: to help find that ideal CTO, provide the occasional bit of advice, and get out of the team’s way as they continue to build a juggernaut of a business. As a shareholder, I couldn’t be happier to accept this role.
With the money, it’s likely that Docker will ramp up its sales and marketing staff to start generating the kind of revenue numbers it needs to go out for a public offering in 2019. The company has built up a slate of independent directors (in another clear sign that it’s trying to open a window for its exit into the public markets).
Docker is already a “unicorn” worth well over $1 billion. The last time Docker reportedly raised capital was back in late 2017, when The Wall Street Journal uncovered a filing document from the Securities and Exchange Commission indicating that the company had raised $60 million of a targeted $75 million round. Investors at the time included AME Cloud Ventures, Benchmark, Coatue Management, Goldman Sachs and Greylock Partners. At the time, that investment valued the company at $1.3 billion.
We’ve reached out to the company for comment and will update this post when we hear back.