Docker Races Toward The Stratosphere With Latest $95 Million Round

Docker Inc., the commercial entity that sparked the container-tech boom, has secured $95 million in funding, the company revealed Tuesday.

The Series D round, one of the largest ever for an open-source startup, represents another milestone for the company behind a technology that has redrawn the DevOps landscape. Estimates now place Docker's valuation in the $1 billion ballpark.

Docker's tremendous growth, and the major inroads it has achieved over the past year into the enterprise data center, can be attributed to the benefits in portability and manageability inherent in container-centric application deployments. But rapid scaling can stress a startup's resources.

[Related: Docker Survey: A Look Into The Container Revolution]

"Our top priority will always be to address the needs of the millions of ecosystem users and thousands of enterprises that have standardized on Docker’s technology," David Messina, Docker's vice president of marketing, told CRN. The financing will enable deeper integration with partners like AWS, IBM and Microsoft, whose industry-leading clouds all support Docker’s technology, Messina added.

"It will also fuel new platform capabilities across the application development lifecycle, solidifying Docker as the foundation for a new generation of distributed applications," Messina told CRN via email.

While Docker has been on a tear over the past year and a half -- Docker containers have been downloaded 300 million times, the company says -- as the technology has matured, it also has become a bigger target for scrutiny. Critics claim Docker's container implementation, while powerful, is burdened by a flawed architecture and security model. Competing container standards are beginning to emerge, including one from partner CoreOS, an operating system optimized to host Docker deployments.

While the bulk of hiring is still on the engineering side, the latest financing will enable Docker to scale its go-to-market efforts, both through its name-brand cloud partners and through a rapidly burgeoning base of system integrators, according to Messina.

Aater Suleman, CEO of Flux7 Labs, one of only a handful of founding Docker partners, told CRN that Docker has rapidly become an integral part of every DevOps conversation the Austin, Texas-based solution provider has with clients.

Suleman attributes that success in large part to the technology and community, as well as the support from Docker Inc., "who have been working not only on the core system but developing and integrating other core technologies with Docker," he told CRN.

The new funding "further increases its viability and applicability and its work that requires capital," he said.

Docker has been making investments to expand its ecosystem and build a whole-product solution for development and production environments inside large enterprises and smaller companies, Suleman said.

"With the new capital, I expect this trend to continue with more investment in orchestration technologies and developer workflow tools. I expect particular focus on technologies that will enable Docker for large enterprise customers, making it easier to use Docker at scale and adding security and making it easier to build compliant, auditable and defensible setups," Suleman told CRN.

Al Hilwa, program director of software development research at IDC, told CRN that while the researcher has not compiled data comparing funding of various open-source companies, Docker's latest round is likely of historic proportions.

For a startup whose value lies in intellectual property around an open-source technology, one without a clear monetization model, "this has to be one of the largest deals of this type," Hilwa said.

In an analysis that IDC circulated, Hilwa wrote, "sounds like the container revolution is only accelerating." The dollars investors are pouring into an open-source company like Docker "shows that we are truly entering the golden age of open source as the foundation of building new business value."

Hilwa also noted, in pondering how the young company should spend its millions, that he believes tech acquisitions are a key piece of Docker's investment strategy to accelerate time to market.

Last year, Docker launched a beta version of Docker Hub Enterprise, a commercial implementation of the technology geared to big business. After several months working with 15 large customers, the enterprise service is preparing for general availability this quarter, a release that will benefit from the latest infusion.

"We want to be ready to fully service these important customers and markets, directly and through large go-to-market partners such as IBM, Microsoft, and our large network of regional systems integrators," said Messina. "All of these important priorities require attention and place pressure on our precious resources."