Four years ago, Docker: I didn’t spend enough money on my B round of financing, and now Docker is struggling to find new sources of funding.
Editor’s note: This article is from WeChat public account “Xiaozhi’s Internet Watch” (ID: hear_and_tell) , author | Tang Xiaozhi.
Docker is a model of container technology, but its current situation seems to be poor.
In a memo leaked earlier, Docker CEO Rob Bearden praised the company’s employees, but the words were very intriguing:
Although “uncertainty poses a huge challenge”, “although we lack clarity in the past few weeks, (employees) are still persistent.”
What is the lack of clarity? A source close to the company said that it was simple and lacked funds.
In fact, Bearden said:
“We have been in contact with investors to get more financing and continue to implement our strategy. I want to share our latest developments. We are currently actively negotiating with two investors and The final terms are being finalized. We will provide you with a more complete update in the coming weeks.”
As of now, Docker has raised more than $272.9 million, but the company has yet to make a profit. ME Cloud Ventures, Benchmark, Coatue Management, Goldman Sachs and Greylock Partners participated in their E-round financing. Investors will certainly not be happy, because in the past 6 years, Docker is still not close to the IPO.
Former CEO Steve Singh promised in May 2019 that by the end of the fiscal year, Docker’s cash flow would be positive, but this does not seem to be the case. Otherwise, Docker will not need to seek additional funding.
Docker was once a commercial software company, and it is in the container field.Achieving a big impact, the valuation after the D round of financing in 2015 reached 1 billion US dollars. However, at the moment it is faltering. There is even news that the company will be acquired. What happened?
Fatal Hazard: Lack of Business Model
The core issue of Docker has been around for a long time and has not been resolved, which has become the company’s Achilles heel: Lack of a viable business model.
This is partly because Docker wants to use its profit center Docker Swarm to make container orchestration. But with the birth of Kubernetes, things are over. Kubernetes has become the best choice for container orchestration, leaving little room for other containers. In fact, Docker has adopted Kubernetes itself.
In a recent interview, Docker’s chief product officer, Scott Johnston, said:
“Docker can add developer services, CI/CD services, content management services, and security services on top of this, whether it’s our Kubernetes cluster or anyone else.”
This sounds great, but since everyone else has joined Kubernetes, it’s hard to see what Docker can offer.
Based on the survey of a research institution:
“The application container market will explode in the next five years. Annual revenue is expected to grow fourfold, from $749 million in 2016 to $3.4 billion in 2021, compound annual growth rate (CAGR) Up to 35%.”
The premise of all this is that you must be a company that provides an effective solution. Google, Microsoft, AWS, and almost all of the largest public cloud companies are trying to take a slice. Red Hat/CoreOS, Canonical, and Mirantis also offer easy-to-use container methods for private clouds.
As for Docker, it does provide a very popular open source container version, but it is not a business model. Even more tragic is that Docker’s own reputation in the open source world is not very good, not many friends.
Kubernetes, killing the master
When Docker is still struggling to find its own business model, including Docker SThe popular container orchestration program inside warm has been terminated by the rise of Kubernetes. Kubernetes has won container wars, and more and more providers are embracing Kubernetes, as mentioned earlier, including Docker himself who embraced Kubernetes.
Today, Kubernetes has dominated cloud business processes. You will find that Superstar Docker a few years ago has given way to the promising Kubernetes.
Unlike Docker’s lack of friends in the open source world, Kubernetes reached an early ally with RedHat, the world’s only open source technology company with annual profits of over $1 billion. As early as 2014, RedHat entered into a strategic partnership with Kubernetes, announcing full investment in Kubernetes. In an official announcement at the time, RedHat expressed its recognition of the “subversive” innovation of containers with a very confident attitude, and boldly predicted that Kubernetes would gain dominance in application orchestration and management after 2015.
At that time, the industry mostly disagreed with this assertion, and even sneered at it. But today, looking back, the prophecy has become a reality.
Rancher’s founder, Dr. Liang Sheng, has a comment that is very reasonable:
Today, there are still many innovations in the field of container technology, but most of these innovations occur in Kubernetes and the CNCF ecosystem.
Docker, dare to ask where is the road?
When the founder of Docker announced his departure in March 2018, the industry was lamented about the prospects of Docker. The industry seems to always have a pessimistic attitude towards the core of the founding team. Before the departure of the founder, chairman and executive vice president of the Apache Foundation, it also gave people a pessimistic outlook for the future of the Apache Foundation and even the open source business. .
But actually, the Docker founder who left the company has not been involved in specific matters for a year, and has little impact on the company’s business level. The series of decisions before the departure of the company is more of a gamble at the time of strategic transformation. Win, of course, lost, but lost a few specific projects such as Docker Swarm. The company’s strategic transformation was finally completed in the midst of it.
The best thing about Docker is to do a good job with developers. In the field of open source software, this is a very important point.. This is one of the core competencies of cloud computing, especially public cloud providers. A similar example might look at MongoDB, which went public a few years ago, with revenues of more than $260 million last year and a market capitalization of $5 billion.
Four years ago, Docker received $95 million in Series D financing, which was valued at more than $1.3 billion. At the time, Docker was not proud to say that the money he received during the B round of financing had not been spent. Now, Docker is struggling to find new sources of funding.
At this time, Kubernetes has come to the fore, and Docker has 500 employees (LinkedIn data) to find the future direction.
The cover image is from pexels