Personal blog of Yzmir Ramirez

In part two of a survey that asks top VCs about exciting opportunities in open source and dev tools, we dig into responses from 10 leading open-source-focused investors at firms that span early to growth stage across software-specific firms, corporate venture arms and prominent generalist firms.

In the conclusion to our survey, we’ll hear from:

• Gaurav Gupta, Lightspeed Venture Partners
• Julia Schottenstein, New Enterprise Associates (NEA)
• Peter Sonsini, New Enterprise Associates (NEA)
• Salil Deshpande, Uncorrelated Ventures
• Ethan Kurzweil, Bessemer Venture Partners
• Sakib Dadi, Bessemer Venture Partners
• Jenny Gao, Bessemer Venture Partners
• Mike Droesch, Bessemer Venture Partners
• Lonne Jaffe, Insight Venture Partners
• Jai Das, Sapphire Ventures

These responses have been edited for clarity and length.

The once-polarizing world of open-source software has recently become one of the hotter destinations for VCs.

As the popularity of open source increases among organizations and developers, startups in the space have reached new heights and monstrous valuations.

Over the past several years, we’ve seen surging open-source companies like Databricks reach unicorn status, as well as VCs who cashed out behind a serious number of exits involving open-source and dev tool companies, deals like IBM’s Red Hat acquisition or Elastic’s late-2018 IPO. Last year, the exit spree continued with transactions like F5 Networks’ acquisition of NGINX and a number of high-profile acquisitions from mainstays like Microsoft and GitHub.

Similarly, venture investment in new startups in the space has continued to swell. More investors are taking shots at finding the next big payout, with annual invested capital in open-source and dev tool startups increasing at a roughly 10% compounded annual growth rate (CAGR) over the last five years, according to data from Crunchbase. Furthermore, attractive returns in the space seem to be adding more fuel to the fire, as open-source and dev tool startups saw more than $2 billion invested in the space in 2019 alone, per Crunchbase data.

As we close out another strong year for innovation and venture investing in the sector, we asked 18 of the top open-source-focused VCs who work at firms spanning early to growth stages to share what’s exciting them most and where they see opportunities. For purposes of length and clarity, responses have been edited and split (in no particular order) into part one and part two of this survey. In part one of our survey, we hear from:

• Vas Natarajan, Accel
• Stephanie Zhan, Sequoia Capital
• Tomasz Tunguz, Redpoint Ventures
• Deepak Jeevankumar, Dell Technologies Capital
• Anna Khan, CRV
• Peter Levine, Andreessen Horowitz
• Ilya Kirnos, SignalFire
• S. Somasegar, Madrona Ventures

  

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