GitHub acquired by Microsoft for $7.5bn in MSFT stock

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(FinancialPress) — The rumors were true. After weeks of speculation, Microsoft (MSFT) confirmed its acquisition of code-sharing and collaboration service GitHub. The acquisition was made with Microsoft stock to the tune of $7.5 billion. GitHub had been valued at $2 billion in 2015.

GitHub will now be helmed by newly-minted CEO Nat Friedman – current VP of Microsoft and former Xamarin CEO. Founder and former CEO Chris Wanstrath will move to Microsoft‘s technical fellow team. He will work on strategic software initiatives. Wanstrath had taken back the CEO mantle after a scandalous harassment investigation involving his co-founder Tom Preston-Werner became public in 2014.

The appointment of a new CEO signals that Microsoft will manage its new asset like it did with LinkedIn. “GitHub will retain its developer-first ethos and will operate independently to provide an open platform for all developers in all industries,” a Microsoft spokesperson told Yahoo Finance.

The GitHub community is 28 million developer-strong, as per a March 2018 report. The platform hosts 85 million code repositories – the biggest source code library in the world. It is one of the pillars upon which a large portion of the tech world builds its software.

Despite its immense popularity in the sector, GitHub has failed to turn a profit thus far. This probably led to opting for a full-out acquisition over the riskier possibility of an IPO.

Its main revenue source to date is its paid account service, which allows for users to have private code repositories and several other company-oriented services. Account prices range for $7 to $21 a month. Users who choose to make public or open source projects get to use the platform for free.

While it is the biggest service provider in its sector, it also faces a lot of competition. Companies such as GitLab and Bitbucket have taken a considerable chomp from the market share.


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Ruben is a South American writer who focuses on the state of the cryptocurrency, cannabis and tech industries worldwide.

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