Tuesday, July 22, 2008

Union Square Ventures goes into the clouds

At ReadWriteWeb, they discuss Union Square Ventures latest investment. Union Square Ventures invested $1.5 million in 10gen, an open source company. 10gen provides complete open source software, and users only pay for the hosting, a service legal agreement and customer service. Union Square Ventures earlier investments include del.icio.us, FeedBurner, EToy and Twitter.

Albert Wenger, part of Union Square Ventures, had this to say about it the new investment on the company blog:

10gen could be seen as a departure from the kind of investments that we have made. But in fact 10gen fits in well with many of our basic premises. First, 10gen is attempting to change the structure of a large market, the $20B+ a year hosting industry. Hosting providers running 10gen will be able to completely abstract away machines and instead provide developers with a platform a la Google App Engine. Second, it is doing so in a capital efficient manner. 10gen is not investing in physical hardware. Instead, 10gen is developing the software and services to run on existing hardware that has been built up and continues to accumulate. Third, 10gen is not looking to traditional sources of defensibility in the form of proprietary closed software or hardware. 10gen is opensourcing the key components of its stack and is actively recruiting contributors (if you are interested, check out the SDK and the contact page).

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