Matt Mullenweg

Exclusive: Automattic seeking to raise more than $100 million

April 15, 2014: 4:33 PM ET

The round will value the company behind WordPress.com at north of $1 billion.

Automattic CEO Matt Mullenweg

Automattic CEO Matt Mullenweg

FORTUNE -- Automattic, the company that runs blogging platforms WordPress.com and WordPress VIP, is out raising between $100 million and $150 million in new venture capital funding, according to multiple sources familiar with the situation.

The round values the company at more than $1 billion and would be a slight step up from its valuation in September 2013. At the time, Tiger Global Management and Iconiq invested $75 million in a secondary transaction, which was mostly used to buy a portion of shares from early investor Polaris Partners. Just a few months prior, Tiger had invested $50 million in a separate secondary round.

But this deal would be new equity, adding to Automattic's $30.6 million in total equity funding. Automattic declined to comment on any fundraising activity.

MORE: Twitter plays defense with deal for Gnip

WordPress now powers 22% of the world's websites, up from 19% last July. For example, around half of the sites hosted by GoDaddy are powered by WordPress. Automattic offers a layer of services on top of WordPress, and has introduced curation and editorial elements into its platform. The company employs four editors and is defending its users against take-down notices under the Digital Millennium Copyright Act. Last week, Automattic acquired content site Longreads.

Company founder Matt Mullenweg took the helm as CEO in January, after previously serving in a product-centric role. In an interview with Fortune several weeks ago, Mullenweg said his transition was always planned, as he had wanted to be older and more experienced before making the switch (he's now 30 years old).

Expect that Automattic would use some of the new funds to fend off challenges from rivals like Squarespace, which today announced $40 million in new funding from General Atlantic (bringing its total funds raised to $78.5 million). Or Medium, the blogging platform led by Twitter co-founder Ev Williams.

Dan Primack contributed reporting to this story. 

Current Issue
  • Give the gift of Fortune
  • Get the Fortune app
  • Subscribe
Powered by WordPress.com VIP.