Docker CEO Scott Johnston
Photo: Docker

Docker’s long road back

Protocol Enterprise

Hello and welcome to Protocol Enterprise! Today: Why Bain Capital now thinks Docker is headed toward its long-sought IPO, Google Cloud embarrasses itself, and the latest moves in enterprise tech.

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A Google-commissioned study reported that 60% of government employees think using Microsoft products makes them more vulnerable to cyberattack. 100% of Protocol Enterprise readers will want to scroll down to see what we think of that survey.

The second act

Docker just landed $105 million in new funding, and lead investor Bain Capital Ventures thinks the container pioneer is in line for its long-awaited IPO down the road.

The new Series C funding acknowledges Docker’s turnaround progress since its recapitalization and restructuring in November 2019, according to Docker CEO Scott Johnston. That’s when Docker ditched its enterprise software strategy with the sale of its Docker Enterprise platform business to Mirantis and refocused its product and marketing strategy on its developer roots.

  • The company has retrained its efforts on making application development easier for software developers with tools and services including Docker Desktop, software that helps developers build and share containerized applications and microservices, and the Docker Hub container image repository.
  • Docker didn’t seek out its latest financing round since the 2019 restructuring, which brings the amount raised since then to $163 million and values the company at $2.1 billion, according to Johnston.
  • Enrique Salem, a partner at Bain Capital Ventures who’s joining Docker’s board, approached the company several months ago, Johnston said.
  • Salem counts Docker as one of the small number of companies that “matter broadly” in the developer ecosystem, he said.

Docker developed and popularized a developer-friendly, open-source format for using containers in 2013 that became a standard for application development as cloud computing adoption started to accelerate.

  • Containers play an important role in speeding up software development by packaging together code and everything else needed to build and more flexibly deploy applications, without the overhead of an operating system.
  • Docker raised more than $300 million from investors over the next several years, and it became one of the first enterprise-tech “unicorns” privately valued at more than $1 billion.
  • But expectations for a big IPO were dashed after Docker failed to find solid commercial footing.
  • Its expansion into container orchestration was thwarted by the success of the open-source Kubernetes project, and its plan to become an enterprise software and services company targeting Fortune 500 companies under former Concur CEO Steve Singh faltered.

Salem characterized Docker’s restructuring progress as “exceptional” and “unique.”

  • “There's really been a clear acknowledgement by developers that Docker is an essential part of software development,” Salem said.
  • Bain can help Docker think through how to continue to scale and prepare for an IPO, Salem said.
  • “As the company progresses, we think it has all the attributes [to go public],” he said. “The addressable market for Docker is just very, very big, and we see an opportunity to build one of the iconic companies.”

With the new funding, Docker will focus on further simplifying the developer experience around Kubernetes, providing tools for developing secure applications and further leveraging ecosystem partnerships.

  • “While cloud-native is super exciting, and [there’s] lots of new tech coming up, that tech can be intimidating or complex for development organizations to adopt,” Johnston said. “We're going to double down on making it easy for developers to build applications for and ship to Kubernetes whether it's on premises, whether it's in the cloud.”
  • Docker will also help developers build more secure applications to combat increasing supply chain attacks, Johnston said.
  • “That starts with providing them with trusted content out of the box that they know they can rely on, they know is being patched and maintained, and the vulnerabilities are being immediately addressed inside those images,” he said.

Docker last month reported its annual recurring revenue topped $50 million for the fiscal year that ended Jan. 31, its second full fiscal year since its restructuring. That’s four times better than the previous year.

  • That growth has been driven by the increased demand for new applications and new developers to build those applications, particularly since the coronavirus pandemic accelerated the shift of professional, personal and social activities online.
  • At the same time, a surge in software supply chain attacks makes securing those applications paramount.
  • “The stats that we see from IDC are that there's going to be 500 million new applications developed in the next couple of years, and that is more than all applications that have been developed in the 40 years of the history of IT,” Johnston said.
  • Docker is chasing a nearly $50 billion annual developer market opportunity that’s growing 22% year over year, according to Johnston, who cited Dell Technologies Capital statistics. The number of developers is estimated to increase to 45 million in this decade, from the current approximately 25 million.

In just five months, Docker Business accounted for more than half of Docker’s growth and recurring revenue in the last fiscal year, according to Johnston. With the new momentum and funding, Johnston said he’s not worried about repeating mistakes of the past or Docker losing its focus.

  • “Anytime you take investment money, it's to achieve a return for those investors, and so the expectation is that, of course, we're going to continue to grow the business and scale our impact,” he said.
  • “But the last 2.5 years and the results of those 2.5 years … give us confidence that we're on the right track. We're pretty excited about the road ahead.”

— Donna Goodison (email | twitter)

A MESSAGE FROM UPWORK

Seeking to triple its employee base, Whisk, a fully remote team, sought diverse talent from a wide variety of regions through Upwork, a work marketplace that connects businesses with independent professionals and agencies around the globe.

Learn more

Things that won’t come back to bite us for $1,000

Somebody at Google Cloud thinks government IT buyers are stupid.

That’s the only possible explanation for the blog post the company published and distributed to reporters Thursday, which cited “a new survey” (commissioned by Google, of course) claiming that 60% of U.S. government employees think they’re “more vulnerable” to hacking or a cyberattack because they use Microsoft products, which, as is true in the rest of the world, are used more widely inside government organizations than Google Workspace.

“As governments work to meet the demands and preferences of their constituents — and their employees—it’s clear that there’s an overreliance on legacy solutions, despite a track record of cybersecurity vulnerabilities and poor user perception,” said Google’s Jeanette Manfra, senior director for global risk and compliance. The message isn’t exactly subtle: In the grand enterprise marketing tradition of sowing “fear, uncertainty and doubt,” Google is trying to make the people responsible for choosing their organization’s collaboration software think that Microsoft’s tools will let the bad guys into their workplace.

There are people inside Protocol laughing at this section, given how often (and loudly) I’ve complained about our use of Outlook. But personal preferences are one thing; trying to make people feel like they’re responsible for any cybersecurity incidents that befall them because they chose the world’s most widely used workplace collaboration software is kind of pathetic.

Microsoft’s security track record is certainly checkered. But does Google really think if Workspace was the predominant government IT collaboration tool, that hackers bent on getting inside U.S. government assets wouldn’t find holes in its products?


— Tom Krazit (email | twitter)

Enterprise moves

Gunjan Aggarwal joined Confluent as chief people officer. Aggarwal was previously EVP for RingCentral and also worked for Ericsson.

Mac Avancena joined HPE as VP of GreenLake. Avancena was previously CIO for Kern County and worked in product management for NBCUniversal.

Mukund Gopalan joined Ingram Micro as chief data officer. Gopalan previously held technical leadership roles at Meta, GrubHub and Priceline.


— Aisha Counts (email | twitter)

Around the enterprise

Microsoft acquired Minit, a small process-mining startup based in the Slovak Republic that could help it be a larger player in an interesting and evolving space.


Russia’s Mikron, which makes chips that power a key part of the country’s banking system, was hit with fresh sanctions as the invasion of Ukraine drags on.

A MESSAGE FROM UPWORK

Whisk isn’t alone in unlocking the global marketplace to find the right types of employees to support its business goals. More than three-quarters of U.S. companies have used remote freelancers, according to research from Upwork, and more than a quarter of businesses plan to go fully remote in the next five years.

Learn more

Thanks for reading — see you tomorrow!

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