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Cloud Host DigitalOcean Raises $37.2M in Funding for Scaling, Hiring

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DigitalOcean, a web hosting startup geared towards making hosting simple for developers, has closed a $37.2 million Series A led by Andreessen Horowitz and including IA Ventures and CrunchFund.

The new funding, according to a DigitalOcean blog post, will be used to increase DigitalOcean’s scale worldwide through buying “a boat-load of servers and networking gear.” It will also be hiring more engineers who will work remotely, and sponsor more conferences and community meetups in different cities.

The DigitalOcean post said Andreessen Horowitz understands and supports the company’s values. “We met with Peter Levine of Andreessen Horowitz and he immediately impressed us not only with his technical knowledge but also with his views on open-source and how to build successful companies around that focus.”

DigitalOcean’s Infrastructure-as-a-Service offering has grown significantly since its launch in 2011.  Between December 2012 and June 2013, its number of web-facing servers had grown 50 times over – faster than any company other than Amazon, Alibaba and Hetzner. In August 2013, DigitalOcean raised $3.2 million in seed funding.

Of course it hasn’t all been smooth sailing. DigitalOcean had to update its code in late 2013 after a German researcher pointed out that it doesn’t automatically wipe the data from its solid-state drives. But this openness and ability to adapt to problems is likely to help it gain support among developers.

To date, DigitalOcean has launched more than 1,000,000 virtual servers, and opened data center locations in San Francisco, Singapore and Amsterdam for more than 100,000 customers.

About the Author

David Hamilton is a Toronto-based technology journalist who has written for the National Post and other news outlets. He has covered the hosting industry internationally for the Web Host Industry Review with particular attention to innovative hosting solutions and the issues facing the industry. David is a graduate of Queen’s University and the Humber College School of Media Studies.

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