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Y Combinator’s Continuity Fund and GV have invested $15 million in San Francisco-based PostHog in a Series B financing. The fund will be used to fulfill the rising demand for the company’s service. By the end of this year, it plans to double its workforce and then do so again by 2022. The company’s business plan is to develop an “open core” business model based on open-source software.
PostHog, an open-source product analytics provider, has raised $15 million in a Series B round from Y Combinator’s Continuity Fund and GV, Google’s venture capital division.
The firm said that the funds would be used to meet increased demand for its product, with ambitions to quadruple its personnel by the end of this year and then again by 2022.
PostHog provides data and analytics on how people use their products and insights on noticeable patterns and user retention and assistance in removing bottlenecks and reducing churn.
The PostHog platform contains “feature flags,” which allow product teams to toggle experimental new features on or off with a subset of users, and “session replays,” which would enable users to view a single app-browsing session to see how consumers are interacting with their product.
PostHog’s business strategy, which involves building an “open core” business model on top of an open-source product, is becoming more widespread throughout the technological spectrum. Opening its platform to the developer community helps build links with potential consumers and provides a potentially lucrative inroad to more paying customers in the future.
PostHog product marketer Joe Martin told VentureBeat, “The way we think about this is guided by our mission, which is to increase the number of successful products in the world. If we can help more users out for free, we invariably get a higher volume of inbound paid inquiries. Often a developer that finds us to use on a side project one weekend may decide to take us into work on Monday.”
Martin added that the company hadn’t intended to raise additional funds so soon, but it could not keep up with demand.
The firm, based in San Francisco, was founded in 2019 as a predictive analytics tool for sales teams. It transitioned to product analytics during its time at Y Combinator (YC) in early 2020 and secured a $3 million seed round in April, funded by YC’s Continuity Fund. The company then raised $9 million in a Series A financing spearheaded by GV in December.
Staples, SpaceX, and Grafana are among the firms that have signed up for PostHog.