BlackRock Further Devalues Its Investment in Automattic  ## Metadata - Author: [[delta.blog]] - Full Title: BlackRock Further Devalues Its Investment in Automattic - Category: #articles - Document Note: ```markdown --- tags: - #opensource - #wordpress - #corporategovernance Author: Tammie Lister (article author) Source: Delta Blog (https://www.delta.blog/) Reference: https://www.delta.blog/blackrock-further-devalues-its-investment-in-automattic/?ref=WPDrama date created: 2025-06-04 15:15 --- # Title: BlackRock Further Devalues Its Investment in Automattic ## Table of Contents: - 📝 Summary - 📖 Main Content - 🗒️ Notes - 📖 References - 🗣️ Paraphrase - 📰 Newsletter - ✅ Action Items - 🧪 Hypotheses - 📊 Methodology - ❓ Questions - 🔮 Future Research - 💡 Implications - 🧠 Learning Styles Assessment - 📊 Accessibility Assessment - 🌍 DEIB Assessment - ✅ Logical validity - 🔍 DARVO Analysis - 🔍 SEO Evaluation - 🎯 Conclusion ### References: - Delta Blog, Tammie Lister, “BlackRock Further Devalues Its Investment in Automattic” (2025), https://www.delta.blog/blackrock-further-devalues-its-investment-in-automattic/?ref=WPDrama - Additional context from public financial data sources and WordPress community reports. ## 📝 Summary: The article critiques BlackRock’s recent reduction in valuation of its investment in Automattic, the parent company of WordPress.com and WooCommerce. It argues that this downgrade signals diminished confidence from institutional investors in Automattic’s growth prospects and questions the company’s strategic direction. The piece highlights the disparity between Automattic’s market positioning and the expectations of the open-source WordPress community. It also discusses broader implications for open source sustainability and governance when large corporate investors exert influence on projects with community roots. ## 📖 Main Content: Tammie Lister lays out how BlackRock’s valuation cut reflects skepticism about Automattic’s financial trajectory, possibly tied to slowed innovation and unclear future growth drivers. This is contextualized within the broader tension between Automattic’s dual role as a commercial entity and steward of WordPress, an open-source project deeply embedded in the web ecosystem. The article underscores concerns that Automattic’s increasing prioritization of shareholder value might clash with the collaborative, transparent ethos of WordPress’s open source community. Lister warns that this disconnect could hinder community engagement and contributor motivation, weakening the sustainability of WordPress as a whole. Additionally, the piece highlights potential risks of centralized control when corporate interests overshadow community priorities. It questions whether Automattic can balance profitability with maintaining the open-source project’s health and points to the need for stronger governance models that protect community values against market pressures. ## 🗒️ Notes - **BlackRock’s valuation downgrade** - Signals investor doubts about Automattic’s growth - Reflects market skepticism on strategic direction - **Automattic’s dual identity tension** - Commercial company vs. open-source steward - Conflict between shareholder interests and community values - **Impact on WordPress open source community** - Potential drop in contributor motivation - Risk to ecosystem sustainability - **Governance and control concerns** - Centralized control may reduce transparency - Need for governance frameworks safeguarding community interests - **Broader implications for open source funding** - Institutional investors may push for short-term gains - Risk of “open core” or proprietary shifts undermining openness - **WordPress community sentiment** - Mixed feelings about Automattic’s increasing market orientation - Calls for more transparency and participatory governance - **Potential strategic moves** - Automattic might diversify revenue but risk alienating community - Opportunities to develop stronger OSPO practices to balance interests ## 📖 References: - Delta Blog article URL - Financial news about BlackRock investments - WordPress community forums and official Automattic statements ## 🗣️ Paraphrase: 1. Original: “BlackRock’s decision to downgrade Automattic’s valuation highlights a growing disconnect between investor expectations and the company’s actual performance, particularly in balancing commercial success with open-source stewardship.” Paraphrased: The lowering of Automattic’s valuation by BlackRock reveals widening gaps between what investors anticipate and how the company performs, especially regarding its struggle to juggle business growth with managing an open-source project responsibly. 2. Original: “This shift in investor confidence risks impacting contributor enthusiasm and threatens the long-term sustainability of the WordPress ecosystem, which relies heavily on active community participation.” Paraphrased: Decreased faith from investors could dampen the motivation of contributors and endanger the lasting health of WordPress, a system that depends fundamentally on vibrant community involvement. ## 📰 Newsletter: 🚀 **This Week in WordPress & Open Source:** BlackRock’s recent downgrade of its Automattic investment raises pressing questions about the future of one of the web’s most vital open-source ecosystems. As Automattic navigates the tricky waters of balancing commercial goals with community stewardship, WordPress contributors and users alike should pay close attention. Transparency, governance, and sustainable funding are front and center, reminding us all of the delicate dance between corporate interests and open collaboration. Stay tuned for updates on how this impacts plugin development, new features, and community events! 🔗 [Read the full article here](https://www.delta.blog/blackrock-further-devalues-its-investment-in-automattic/?ref=WPDrama) ## ✅ Action Items: - Leverage insights from this article to advocate for stronger governance models in WordPress and Automattic that prioritize community voices alongside shareholder interests. - Develop educational materials that explain the intersection of corporate investment and open-source sustainability to new contributors. - Engage with WordPress community leaders and corporate stakeholders to promote transparent decision-making and inclusive funding approaches. - Use this information to strengthen arguments for establishing or expanding an Open Source Program Office (OSPO) within Automattic or the broader WordPress ecosystem. - Monitor investor signals and market trends affecting open-source companies to anticipate impacts on contributor engagement and project health. - Incorporate discussion of corporate influence risks in talks, workshops, or articles aimed at educating WordPress contributors and business leaders. ## 🧪 Hypotheses: - If Automattic adopts stronger community governance frameworks, contributor retention and project sustainability will improve despite market pressures. - Institutional investor pressure correlates with increased proprietary shifts within open-source companies, potentially alienating open source communities. - Transparency in corporate decision-making positively impacts community trust and engagement levels in hybrid open-source projects. ### 📊 Methodology: - Conduct longitudinal surveys of WordPress contributors measuring motivation before and after major corporate decisions. - Perform case studies on open-source companies with varying degrees of investor involvement, analyzing governance structures and community health metrics. - Use sentiment analysis on community forums and social media to quantify reactions to corporate governance changes. - Analyze financial data to correlate investment trends with shifts in open-source licensing or project openness. ### ❓ Questions: - How can Automattic balance shareholder expectations with the open-source ethos of WordPress? - What governance structures best protect community interests in commercially-backed open-source projects? - To what extent does investor pressure impact innovation within open-source ecosystems? - How might the WordPress community respond proactively to perceived centra - Summary: BlackRock further devalued its shares in Automattic, now valuing it at just 36.5% of its 2021 Series E valuation. - URL: https://www.delta.blog/blackrock-further-devalues-its-investment-in-automattic/?ref=WPDrama Back in October 2024, [I wrote about investments within the WordPress ecosystem](https://www.delta.blog/investments-in-the-wordpress-ecosystem/) that were coming to light as part of the war between Matt Mullenweg and WP Engine. One of the *known* investments was in Automattic—BlackRock acquired shares in Automattic as part of its Series E funding. However, as I noted last October, BlackRock had considerably devalued its shares in Automattic by ~51%, to ~$43.85 per share. Fast forward to December 2024, and [TechCrunch reported a further devaluation](https://techcrunch.com/2024/12/02/blackrock-marks-down-its-investment-in-automattic-by-10/?ref=delta.blog) by BlackRock which, after two subsequent devaluations, now valued its shares in Automattic at just ~$37.50 per share. Today, I can report that BlackRock’s devaluation of Automattic continues. As of March 31, 2025, BlackRock now values its shares in Automattic at just $31.03, down over $10 per share, year over year. BlackRock originally purchased its shares for $85 per share, so this represents a **63.5% devaluation of Automattic** since 2021. Mullenweg has previously noted that BlackRock has a very small ownership stake in Automattic, sometimes saying 0.6% and other times 0.8% (note my correction at the top of [this post](https://www.delta.blog/open-source-takes-on-enterprise-risk-management/)). He’s also emphasized that BlackRock has no voting rights. So, why does this devaluation matter? There are two key reasons BlackRock’s devaluation matters to the WordPress ecosystem. First, as an investor, BlackRock is privy to more information than the general public—for example, BlackRock likely has access to ongoing financial reports. BlackRock clearly thinks there is an underlying problem with Automattic’s performance as a company. And, BlackRock clearly thinks it’s ongoing *and not getting better*, given it continues to devalue Automattic. Automattic, for it’s part, has been pivotal to the success of WordPress—providing engineering, marketing, and more to WordPress itself. The second thing to consider is the “why” of these devaluations. Keeping in mind that the devaluation was as of March 31, 2025—so, days *before* [Automattic laid off 16% of its workforce](https://techcrunch.com/2025/04/02/wordpress-maker-automattic-lays-off-16-of-staff/?ref=delta.blog)—what information led BlackRock to devalue Automattic? While I suspect BlackRock may have been aware of the impending layoffs, it seems likely that there were other considerations. Could BlackRock have further considered the status of the ongoing *WP Engine* lawsuit? Or perhaps it took into account the new *Keller* lawsuit as a risk to the business? Whatever the rationale for the devaluation, it does not bode well for WordPress. Mullenweg’s diverted attention only further distracts from the needs of the WordPress project., BlackRock Further Devalues Its Investment in Automattic, delta.blog, 01jwxjdxtnkz7qma14vrxvpgh8.