Harness Hits $5.5B Valuation with $240M Raise to Automate AI’s ‘After-Code’ Gap

Startup Exceeds $250M in Annual Recurring Revenue Projection

Harness, a leading AI DevOps tool, has reached a significant milestone with a $240 million Series E funding round that values the company at $5.5 billion post-money. Founded in 2017 by serial entrepreneur Jyoti Bansal, Harness is poised to exceed $250 million in annual recurring revenue in 2025, according to Bansal.

Key Highlights

– The funding round includes a $200 million primary investment led by Goldman Sachs and a planned $40 million tender offer with participation from IVP, Menlo Ventures, and Unusual Ventures.
– The new valuation represents a 49% jump from Harness’s $3.7 billion valuation in a $230 million round in April 2022.
– With this funding, Harness has raised $570 million of equity to date.

Addressing the ‘After-Code’ Bottleneck

As AI accelerates code production, it is widening a bottleneck in the far larger “after-code” phase of software development – the testing, security checks, and deployment work that still consumes nearly 70% of engineering time. Harness’s tools help automate this sprawling, error-prone layer, even as enterprises grapple with rising AI code volume and the risks of shipping even a single line of faulty software into production systems.

Competitive Advantage

Harness’s AI agents use a software delivery knowledge graph that maps code changes, services, deployments, tests, environments, incidents, policies, and costs. This knowledge graph gives the system a deep understanding of each customer’s software delivery processes and architecture, differentiating Harness from other AI platforms.

Expansion Plans

Harness plans to use the new funding to expand its R&D efforts, hire “hundreds of engineers” at its Bengaluru office, and build out additional automated testing, deployment, and security capabilities while improving the accuracy of its AI systems. The company also intends to strengthen its U.S. go-to-market operations and significantly expand its presence in international markets.

Future Plans

Bansal still plans on taking Harness public one day, though he did not share a specific timeline. “That’s what our goals and plans depend on,” he said of an eventual IPO. “Our business is very, very healthy, very strong, high growth and margins, and it will be a great public company when the timing is right.”

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