As everyone is no doubt aware, GitHub took on $100M of investment capital from Andreessen-Horowitz recently. The big question on everybody's lips was: 'Why?'
Let's look at the clues.
Marc Andreessen wrote recently about 'Why Software is Eating The World'. It's a great article and if you haven't read it I'll wait for you to come back.
In the piece, Andreessen highlights a number of areas where software has converged to make two previously separate things work together in new ways that allow the makers to gobble up markets.
So if we think about GitHub, and a $100M injection of capital, what's the missing piece that could allow GitHub to expand and gobble up a new market place? Who should be afraid of this turn of events?
GitHub is where increasingly more of the world's code lives. The code is created by developers, distributed through GitHub and deployed onto servers.
Amazon EC2, Heroku and Windows Azure are increasingly the end destination for much of that code. You can deploy to Heroku with a simple commit and push via Git. It's a lucrative market, with Salesforce recently snapping up Heroku for $212M in cash.
I think that the next phase of GitHub will be to build its own Platform as a Service, that will provide exactly the same benefits and services as Heroku, but at a radical price point. GitHub will use that $100M of capital to build out this service and developers will flock to it, because their code already lives on GitHub. They will build an frictionless experience that trumps any existing deploy model, perhaps even so that your code just automatically becomes available on the web after each commit. Closing the deploy loop is the next logical step for GitHub, and a reason why they would need cash in excess of their current profits.
GitHub will become the de-facto development platform.
And then GitHub will eat the world.