Seattle startup Chef has raised another $US40 million as the race to come up with better ways to build software like Facebook and Google does heats up. It’s now raised a total of about $US105 million over five rounds.
The idea behind Chef is simple but powerful.
Thanks to the advent of cloud platforms like Amazon Web Services, Microsoft Azure, and Google Compute Engine, which lets you deploy code at tremendous scales, it’s harder and more complicated than ever to maintain a mobile app or website, let alone push out updates.
Chef provides automation tools that make it easier for developers to manage the infrastructure their code runs on, while also making it easier for operations to handle ever-growing applications across the web and mobile devices.
It sits at the center of the so-called “DevOps” movement, which aims to bring developers and operations pros closer together in the name of improving speed and efficiency in building and managing applications.
“I think the whole game is how to simultaneously increase quality and velocity,” Chef CEO Barry Crist says.
Chef is one of two companies leading the way here, the other being the similarly well-funded Puppet Labs.
DevOps pays off
So far, things seems to be paying off for Chef.
Back in April, it held a conference for 1,500 of its biggest fans, kicking it off with the announcement that it was growing its annualized recurring revenue (ARR) and revenue per customer around 200 per cent each, year-over-year.
Companies like Disney and General Electric are Chef customers, to boot.
You’d think a company with that kind of growth wouldn’t need to raise a big round like this — and according to Crist, you’d be right.
“The best time to raise money is when you don’t need it,” says Crist, repeating an old Silicon Valley chestnut.
Indeed, Crist says, Chef still has most of its Series B round still in the bank. The new money is intended as a hedge against “bumps in the global economy, the global markets,” Crist says.
In other words, if the stock market continues to worsen (or there’s a bubble burst), Chef would rather make sure it has the money now rather than risk talking to venture capitalists after the money’s dried up.
In the meanwhile, Crist says the company is growing, both in terms of its bottom line and its geographical footprint, with new offices opening up worldwide. Crist says the company has had particular growth in China and the tough-to-crack African market, and so plans on expanding its presence there.
The way Chef operates in a new market, Crist says, is to drop in technical people, not sales folks. If Chef’s engineers can convince prospective client IT teams that DevOps is the way forward, then the company wins.
“We’re pretty close to the center of that universe,” Crist says.
Investor DFJ doubles down
One other note: This round from Chef was led by DFJ Growth, the late-stage investment sister company to early-stage investor DFJ Venture — which also invested in Chef in an earlier round.
Apparently, Crist says, DFJ is very picky about the companies with which it double dips on early and late stages. That means that this round places it into good company with the likes of Elon Musk’s Tesla and SpaceX, both of which also received funding from both DFJ companies.
This round also included a strategic investment from HP Ventures. The company has now raised about $US105 million in total financing.
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