Today, I’m excited to announce that Insight Partners has invested USD $172.5 million for a minority stake in Octopus Deploy, joining us as a partner as we look ahead to the next decade of growth on our journey as a company.
Insight Partners is one of the largest and most successful venture funds in the world, and one of the most prolific investors in enterprise DevOps software companies, with investments including SonarSource, JFrog, Pluralsight, and Veeam. Their scale and expertise will be essential to our continued growth and success.
Octopus Deploy is a bootstrapped software company, something we’ve always been rather proud of. Every dollar we’ve used to build the company has come from our customers, not investors. We’ve grown very quickly, but we’ve always managed the company conservatively and been highly profitable along the way (30%+). We’ve never really considered ourselves a “startup” - not the venture track kind anyway. So we appreciate that today’s announcement might come as a bit of a surprise.
A decade in the making
When I started Octopus, I was obsessed with deployments and making it easier for teams. I was a huge believer in the power of continuous delivery, but frustrated that so much of CD in the wild ended with code that compiled and passed unit tests, but wasn’t deployed anywhere. Aside from the “people stuff”, deployments were - and still are - the hardest part of continuous delivery.
That was in 2011, and I blogged about coding Octopus Deploy at the time. A lot of folks started to pay attention, some who are reading this announcement today. Hundreds and then thousands of visionary developers and software teams began to follow along with our journey and gave Octopus a try through the early beta releases.
In 2012 when Sonia and I turned Octopus from a nights-and-weekends project into a business, we wanted to solve deployments for as many companies as we could, but our aspirations were modest and we didn’t have plans to grow particularly big. We went from milestone to milestone - the first release, the first sale, the first hire, the first office. I still vividly remember getting the first USD check in the mail and wondering if a bank here could accept it, and trying to work out why US customers keep asking for a “W9”.
Since then we’ve grown astonishingly. We’ve helped 25,000 companies to automate 180 million deployments, and over 350,000 people use Octopus Deploy. We have the second most popular plugin for TeamCity (just behind .NET Core), and we are the most popular third-party deployment plugin for Azure DevOps.
More recently, our success in enterprises has been incredible, and this is the fastest growing segment of customers. While Octopus helps teams to automate deployments, at the enterprise level, it also helps tame a lot of complexity and meet compliance needs, especially in the multi-cloud/hybrid-cloud world we’re all in.
Octopus Deploy has grown a lot bigger than we ever expected, and today we employ 109 people across Australia, the US, and the UK. And the message from our customers is clear: we have a strong product that people love to use (our net promoter score is 65+, which is unheard of in enterprise software), but there’s always more to do.
The next decade
I’ve been talking to Insight on and off for a few years, along with a handful of other VC firms. We never sought an investment, but we were getting noticed, and VC firms would reach out, and we’d politely decline most of them and occasionally take a call. That got tiring pretty quickly, but there were a handful we kept in touch with, and Insight was top of the list.
Then in October 2020, Insight Partners approached us again with a very firm belief that we’d built something special. Unknown to us, they’d been talking to dozens of our customers, getting a real sense of what those customers valued in Octopus. They had incredible conviction that what we’d built was special - they’d gotten the message loud and clear from our customers that Octopus was the #1 category leader for enterprise deployment automation - and they had a strong pitch for how they could help continue our growth.
Around that time, we were about 80 people and planning for 2021. We were planning to grow rapidly to 180+ in 2021 if everything went according to plan, and 300+ in 2022. It sounds like a lot, but we could afford that kind of growth based on revenue alone, and there was no need to take an investment to fund it.
I started to think a lot about the kinds of challenges that lay ahead though. Our business model and growth isn’t reliant on raising funds, but it is reliant on having smart people around, both inside and outside of the company. As I mulled over the Insight pitch and spent more time with them, I found myself learning a lot and really enjoying it, and I realized that our long-term plan would be more achievable with them than without them. It felt very easy and natural to imagine them as part of our team. We signed a term sheet and started the diligence process.
The diligence and legal work was all completed at the end of December. As we’re an Australian company, the deal was subject to approval by the Australian government’s Foreign Investment Review Board. FIRB’s time frame is 30 days to 6 months, so I guess we should consider the three months it took them to find their green stamp a blessing!
What’s going to change?
As far as how we think about our business, nothing is changing. Sonia and I still own the majority of the company, and I plan to remain CEO for as long as I feel I’m the best person for it. What makes Octopus a good investment for Insight is that we’re very aligned: Insight has a very long-term perspective as do we; our growth goals are the same; and we all think Octopus should remain a growing, profitable, conservatively managed company.
One change I have noticed is the general sense of energy, excitement, ambition, and focus internally. Thinking about the next decade and where we’re going has given us a lot of clarity about what we want to achieve, and everybody is really buzzing. We’ve got big plans for our product and customer experience over the next few years, and our friends at Insight have been great sounding boards.
Investments like this are often seen as validation for the company, but I think in this case, it’s really a validation of you, our customers. And so I want to say a big thank you.
When you told your manager you’d found a great tool to help automate deployments, they probably thought you were a hero. But when you told them the vendor was a small, bootstrapped company from Australia, and you’re not sure they even have a sales person your manager can talk to, they probably started to worry about you. Why didn’t you select the product from a large corporation, or from the established enterprise vendor? No doubt, it was an uphill battle. But you did it anyway. You gave us the chance to help make your deployments a little happier, and told your colleagues about us. Genuinely, we wouldn’t be here today without you.
Our goal is to continue to be the #1 choice for enterprise deployment automation for .NET and the JVM stacks, to continue to build a sustainable business that you can rely on to be around for a very long time, and to continue to be worthy of your business. I’m very confident that our friends at Insight will be a great support to us on the next decade of our journey.
Founder and CEO