Resolve AI, a startup specializing in developing an autonomous site reliability engineer (SRE) tool for automated software system maintenance, has successfully raised a Series A funding round led by Lightspeed Venture Partners, according to three individuals with knowledge of the deal.
Sources indicate that the publicized valuation for this latest round is $1 billion. However, the company’s actual blended valuation was lower due to a multi-tranched structure. In this arrangement, investors acquired some equity at the $1 billion valuation, but purchased the majority of the round at a reduced price. This innovative investment strategy has recently become popular among highly sought-after AI startups, investors report.
The startup’s annual recurring revenue (ARR) is estimated at approximately $4 million, as confirmed by two of the sources. The exact amount of funding raised in this round could not be ascertained.
Resolve AI and Lightspeed did not respond to requests for comment.
Established less than two years ago, the startup is led by former Splunk executive Spiros Xanthos and Mayank Agarwal, Splunk’s former chief architect for observability. Their professional collaboration spans two decades, tracing back to their graduate studies at the University of Illinois Urbana-Champaign. This is not their first joint venture; they previously co-founded Omnition, a startup that was acquired by Splunk in 2019.
While human SREs are traditionally tasked with manually troubleshooting and resolving system failures, Resolve AI automates this entire process by independently identifying, diagnosing, and rectifying production issues in real time.
This automation addresses a growing challenge for companies. As software systems become increasingly complex and distributed across cloud infrastructures, organizations frequently struggle to find and retain enough skilled SREs to ensure smooth system operation. Automating these tasks can lead to reduced downtime, lower operational costs, and allow engineering teams to concentrate on developing new features rather than constantly battling production problems.
Last October, Resolve AI completed a $35 million seed funding round, spearheaded by Greylock, with participation from World Labs founder Fei-Fei Li and Google DeepMind scientist Jeff Dean.
Resolve AI faces competition from Traversal, another AI SRE startup, which recently secured a $48 million Series A round, led by Kleiner Perkins and including Sequoia as an investor.