<story><title>Bootstrapped GitHub Now Raising a Round from Andreessen Horowitz</title><url>http://pandodaily.com/2012/05/21/bootstrapped-github-now-raising-a-round-from-andreessen-horowitz/</url></story><parent_chain><item><author>SeoxyS</author><text>Two questions:&lt;p&gt;- How is GitHub worth less than Pintrest?&lt;p&gt;- What could GitHub possibly gain from raising money? It&apos;s clearly not about money. Is this a liquidity event? Couldn&apos;t they just issue a dividend for that, they&apos;ve clearly got plenty of cash… Or is this about the credibility of having a valuation. In that case, couldn&apos;t they have gone public? Amazon went public at a sub-$500M valuation, and look at them now!&lt;p&gt;Edit: come to think of it, I can see the possibility of wanting to acquire other companies, and not currently having the capital to do so. That&apos;s about it.</text></item></parent_chain><comment><author>dlokshin</author><text>I remember reading an interview with Pierre Omidyar (founder of Ebay) raised $5M from Benchmark, opened a separate bank account, and placed the $5M in there, untouched to this day because eBay was profitable from the very beginning.&lt;p&gt;He raised the money from Benchmark because he needed help recruiting executives to help run and expand the company. His recruitment efforts before that had been largely unsuccessful, and he openly admitted that no one took him seriously before he raised money.&lt;p&gt;Yes, the internet was a new and unproven phenomenon at the time, but there are other reasons to hitch up with a VC other than money.</text></comment>
<story><title>Bootstrapped GitHub Now Raising a Round from Andreessen Horowitz</title><url>http://pandodaily.com/2012/05/21/bootstrapped-github-now-raising-a-round-from-andreessen-horowitz/</url></story><parent_chain><item><author>SeoxyS</author><text>Two questions:&lt;p&gt;- How is GitHub worth less than Pintrest?&lt;p&gt;- What could GitHub possibly gain from raising money? It&apos;s clearly not about money. Is this a liquidity event? Couldn&apos;t they just issue a dividend for that, they&apos;ve clearly got plenty of cash… Or is this about the credibility of having a valuation. In that case, couldn&apos;t they have gone public? Amazon went public at a sub-$500M valuation, and look at them now!&lt;p&gt;Edit: come to think of it, I can see the possibility of wanting to acquire other companies, and not currently having the capital to do so. That&apos;s about it.</text></item></parent_chain><comment><author>fusiongyro</author><text>&amp;#62; How is GitHub worth less than Pinterest?&lt;p&gt;I&apos;ll speculate.&lt;p&gt;Github&apos;s fighting a losing game. They are trying to charge for something they are also giving away for free, and their target market is people who are uniquely qualified to replace them. There are plenty of quality Github alternatives around right now. To stay on top they have to continue to be at the forefront development-wise and they have to continue to have the majority of developer attention to reap the network effects. It&apos;s precarious.&lt;p&gt;Compare to Pinterest. They make money, ostensibly, from every product someone pins. People pin lots of products, and the people doing the pinning and the browsing have higher conversion rates than people browsing Google or other sites looking for things to spend money on. Pinterest is also a brand; it will be hard to get everyone using Pinterest to switch just because a better version exists somewhere else. People can collaborate with Git without using Github; the only tangible loss is the pull request feature.&lt;p&gt;It takes Pinterest less work to convert a byte of bandwidth into profit. Not only do they need less development effort moving forward, they also stand better odds of making money on some random user.</text></comment>