Cockroach Labs, the company behind CockroachDB, has experienced significant fundraising success in recent years. Today, the organization announced a $160 million Series E funding round, resulting in a company valuation of $2 billion. This investment arrives only eight months after the startup secured $86.6 million in a Series D round.

Altimeter Capital spearheaded the latest investment, with contributions from new investors Greenoaks and Lone Pine, as well as existing investors including Benchmark, Bond, FirstMark, GV, Index Ventures, and Tiger Global. This round effectively doubled the company’s prior valuation and brought the total funding raised to $355 million.

According to co-founder and CEO Spencer Kimball, the company’s revenue more than doubled in 2020, despite the challenges presented by COVID-19. This growth attracted the attention of investors, and Kimball attributes it to the accelerated adoption of cloud technologies observed throughout the industry during the pandemic.

“The pandemic prompted a more rapid transition to the cloud, as organizations sought to develop the next generation of applications and services. This is fundamentally the space where we operate,” Kimball explained.

As this trend unfolded, the company reevaluated its strategies. While offering an open-source version of CockroachDB and a 30-day free trial of its cloud service have proven effective in attracting initial customers, the company intends to implement a new approach.

Specifically, it plans to replace the 30-day trial with a perpetually available, unrestricted version later this year. The company anticipates this will encourage more developers to explore the platform and experience its complete functionality without requiring credit card details. Furthermore, this change is projected to reduce the costs associated with supporting the free tier.

“We anticipate users will be able to accomplish a wide range of tasks on the free tier, from participating in hackathons and personal projects to launching startups with the potential to become major players like DoorDash or Airbnb,” he stated. Kimball noted that early-stage companies often have limited user bases and can remain on the free tier until they achieve a strong product-market fit.

“At that point, they can provide payment information and expand beyond the free tier’s limitations, paying only for their usage,” he said. The enhanced free tier is currently undergoing beta testing and is scheduled for release this year.

Kimball indicated that the company wasn’t actively seeking funding, but recognized the need for additional capital to compete effectively with industry giants like Oracle and AWS, as well as numerous other database startups. While an initial public offering (IPO) is a possibility as the company’s revenue increases, it is not anticipated in the immediate future.

The company concluded the year with a team of 200 employees, and Kimball projects that number will double by the end of the current year. He emphasized the importance of data-driven insights and fostering a welcoming, inclusive culture to build a diverse workforce.

“The foundation of any successful optimization effort is having clear metrics and consistently monitoring them to assess progress,” he explained.

He further added, “Our primary focus is on cultivating a strong company culture, a process we’ve been dedicated to for all six years of our existence. Creating an inclusive environment built on mutual respect is crucial for promoting diversity.”

Kimball envisions a hybrid work model following the pandemic, with a small percentage of employees regularly working from the office and others visiting quarterly, but does not foresee a complete return to traditional office arrangements.