WordPress Parent Automattic Raises $300 Million — What It Means for Publishers

Technology firms embark on new funding rounds every day in Silicon Valley. But when WordPress parent company Automattic announced that it had closed on a $300 million funding round, at a $3 billion valuation, earlier this week, the digital publishing community took notice.

One reason for the intense interest is because Automattic has famously shied away from large funding rounds in the past. Although the company has been around for 15 years, its last round was a $160 million Series C round five years ago. This week’s announcement that the company had closed a $300 million round was not only news because of the sheer amount of money involved and the high valuation of the company, but also because the single investor in this round is Salesforce Ventures.

Digital publishers, in particular, are seeing this week’s news as a positive step forward for the WordPress.com platform. WordPress is an open-source project, and the WordPress content management system has grown to become the most popular CMS of its kind. Raising this kind of money ensures that the WordPress platform isn’t going away anytime soon. In fact, many publishers expect that this round will lead to even more popular services that sit atop the WordPress CMS.

In addition to contributing to WordPress, Automattic also runs popular services like the Jetpack plugin, WordPress.com VIP, and WooCommerce.

(You can read more about the Jetpack plugin in Web Publisher PRO’s guide to the top WordPress comment plugins for news publishers, here.)

Automattic’s trajectory as of late is fully intertwined with the growth of WordPress. In just the past five years, WordPress has grown from supporting 22% of the world’s top 10 million websites to 34%. In an interview, Automattic Founder Matt Mullenweg said he sees the potential for WordPress to get similar market share as Android, which now has an estimated 85% of all handsets.

The growth of Automattic over the past decade can be largely attributed to the expansion of the WordPress platform, not only in terms of the number of publishers using the CMS, but also in terms of the features that the WordPress CMS provides.

Today, WordPress is viewed as the single most highly customizable CMS on the market. Publishers can run blogs, distribute news content, sell digital and physical goods, and even host their own directories through WordPress.

With a $3 billion valuation, Automattic will be in an even stronger position to grow WordPress into the de facto operating system for the open web. The CMS is expected to become even more open and user-centric in the coming years.

WordPress Funding – Takeaways for Digital Publishers

Publishers have good reason to be optimistic about WordPress in light of Automattic’s impressive funding round. With a $3 billion post-money valuation, the company now has the biggest market share.

Publishers can look at Salesforce Ventures’ confidence in the company and see that Automattic—and by extension, WordPress—is only getting stronger. While smaller, closed CMS systems come and go, WordPress is being built up as a CMS that publishers will be able to rely on for the long-term.

Salesforce’s investment also speaks volume about the value that Silicon Valley sees in WordPress’ open-source philosophy. Unlike closed CMS systems, which have had trouble scaling up, the WordPress.com open-source project uses a freemium model that runs on a cycle of adoption, building, and more adoption. The more publishers switch to the open source WordPress platform, the stronger the platform becomes. With more money in its coffers, Automattic can continue to grow WordPress in a sustainable way.

If you’d like more information on making the switch from a closed CMS system to WordPress, reach out to our team of web publishing experts.