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PingCAP Raises Huge Series D Round

PingCAP, the San Mateo company behind open-source NewSQL database TiDB, just announced the closing of a $270M Series D round. The round, which PingCAP says will enable them to continue their global expansion, was led by an impressive list of investors including GGV Capital, Access Technology Ventures, Anatole Investment, Jeneration Capital and 5Y Capital. This Series D round comes more than 2 years after PingCAP’s $50M Series C and brings their total capital raised to $341.6M since launching in 2015. 

Why this transaction?

The York IE team chose this as our transaction of the week to discuss trends occurring in the Hybrid Transactional and Analytical Processing (HTAP) market. Similar to other industries, the HTAP market has seen consistent growth in the demand for real time processing as firms are beginning to handle more data and require scalability. Many companies looking to reduce their Total Cost of Ownership (TCO) have turned to PingCAP’s TiDB software; by pairing online transactional processing (OLTP) and online analytical processing (OLAP) in the same database, TiDB is able to streamline the analytics process. Because of it’s open-source origins, TiDB has a thriving ecosystem of contributors that validate different scenarios across applicable industries. Recently, PingCAP unveiled their latest solution, TiDB Cloud, for customers who want all the benefits of TiDB without all the responsibilities attributed to the back end. Switching to TiDB Cloud saves customers time and money related to maintenance and infrastructure, allowing them to focus on their applications without the complexity. 

Open-Source Funding 

The transition from closed-source to open-source software over the past few years has been robust. Vendors and customers switching from closed-source systems to open-source counterparts gain the community that closed-source lacks. In our opinion, this community helps with two things, 1.Customer acquisition/Familiarity – developers can get to know the software and use it for free. If they like it, they’ll want to bring it into their work, 2. Continued improvement – If you have a community constantly contributing to the open source version then in theory, it is constantly being improved by the people who use it. 

Using our Fuel platform, the York IE team gathered data relating to open-source funding trailing the past ten years:

According to the Fuel platform, total funding and total rounds for open-source companies have been growing at a steady pace since 2010 reaching a peak in 2018. Since then, it is possible that investors have realized that the time to scale for an average open-source based company often exceeds 10 years. This extended timeline from development, to adoption, to monetization and finally scaling, may have led to reduced interest in recent years from the investor community.

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