Automattic fundraising

As Om and Matt report, we closed a $29.5 million round of financing for Automattic today. Coincidentally, the closing is happening during one of our bi-annual company get-togethers, so we’ll be able to toast the occasion in person! (Team Automattic is spending the week on a ranch in the beautiful desert of Southern Arizona.)

Over the last two years, Automattic’s business has been expanding at a rapid rate. Our most prominent service, WordPress.com has grown to over 2 million bloggers. Their blogs are read by an astounding 114 million unique visitors from all over the world and over 42 million from the US every month (according to Quantcast, that makes us the #12 site in the US, ahead of sites like Facebook and Wikipedia). Revenues have been growing as well, we’ve been profitable as a business, and we’ve accomplished all of this with a fantastic team of fewer than 20 people.

Late last year we sat down to figure out how we’d like to expand our business in 2008 and beyond. Since things are working well, we didn’t want to make any major changes. However, we did set a couple of new goals. One was to put enough money in the bank to have financial security for years to come. Another was to invest more aggressively into our “other” products and services (other than WordPress) like Akismet, Gravatar, and bbPress. Today’s financing will help us achieve both of those goals.

The financing is led by our existing investors Polaris Venture Partners, True Ventures, and Radar Partners. We thank them for this solid vote of confidence. We also have an exciting new investor joining us: the New York Times. In addition to investing in us, we are also entering a partnership with the Times to expand their existing WordPress blogging infrastructure and to create new ways of connecting WordPress bloggers with the New York Times and its readers.

Update: VCMike has posted his thoughts on the deal (VCMike is Mike Hirshland, who is an Automattic board member and has led Polaris’ investment in us).