The startup Vercel just announced its second funding round of the year, which its CEO attributes to the "skyrocketing" popularity of its open source project Next.js.
Next.js makes it easy for developers to build and deploy web applications using React, a Facebook-created open source project that helps developers makes sites more interactive. Vercel's recent virtual conference about Next.js drew 82,000 registrants, with 35,000 people attending on the day of the event.
"Throughout 2020, we started to see a dramatic rise in adoption both in Next.js and in the Vercel platform," Vercel founder and CEO Guillermo Rauch told Business Insider. "With that came inbound interest from investors."
Roughly 8 months after its Series A, the firm announced a $40 million Series B round on December 16 led by GV (formerly Google Ventures), with participation from Greenoaks Capital, Bedrock Capital, Geodesic Capital, Accel, and CRV. This brings its total funding to $61 million, though the firm declined to share its valuation.
Vercel, previously called Zeit, relaunched earlier this year and has transitioned towards a product focused on front-end development, or developing the software that end-users interact with. Apps like TikTok, Starbucks, Netflix, Twitch, and Hulu are all using Next.js.
"We closed some of the largest deals of the year with companies that were seriously impacted by the pandemic but were still turning to technology to solve their challenges," Rauch said. "When the COVID challenges happened or began, companies turned to technology to solve them, as opposed to turning away."
Vercel competes with other startups Gatsby and Netlify, though Rauch says those companies focus more on static websites, while Vercel makes it possible for websites to scale dynamically.
"This is the one we had an early conviction was breaking out and moving faster than others," Tyson Clark, general partner at GV, told Business Insider of Vercel's competitive prospects. "It was more interesting and more compelling."
With the funding, Vercel wants to double down on hiring "the most talented and inclusive team," Rauch said.
Here's the pitch deck Vercel used to raise $40 million:
