Harness secures $240 million in Series E funding, elevating its valuation to $5.5 billion
Harness, a prominent player in AI-driven automation, has successfully closed a $240 million Series E funding round, raising its post-money valuation to an impressive $5.5 billion. The investment includes a substantial $200 million primary contribution led by Goldman Sachs, along with a planned $40 million tender offer featuring participation from notable firms such as IVP, Menlo Ventures, and Unusual Ventures. This tender offer aims to provide liquidity for long-term employees, according to co-founder Jyoti Bansal.
This latest funding round marks a significant 49% increase from its previous valuation of $3.7 billion reached during a $230 million funding effort in April 2022. To date, Harness has successfully raised a total of $570 million in equity.
As artificial intelligence rapidly accelerates code generation, it also highlights inefficiencies in the “after-code” phase of software development, which encompasses testing, security assessments, and deployment tasks that account for nearly 70% of engineering resources. Harness aims to tackle these challenges by automating the complex and often error-prone processes that come after coding, especially as companies contend with the increased volume of AI-generated code.
Harness distinguishes itself through AI agents designed to automate vital tasks like testing, verification, security, and governance. The company leverages a sophisticated software delivery knowledge graph that captures an extensive range of elements from code changes to deployment incidents. This unique approach gives Harness an intricate understanding of its clients’ software delivery architecture, enabling the system to generate pipelines tailored to meet specific operational requirements.
Moreover, Harness’s orchestration engine effectively translates AI-generated recommendations into automated actions, while incorporating safeguards to ensure reliability in application.
Despite the inherent limitations of artificial intelligence, Bansal emphasizes the importance of human oversight within the system. AI-generated tests or fixes undergo a thorough review process by engineers and compliance teams before implementation.
Harness faces competition from major players such as Microsoft’s GitHub, GitLab, Jenkins, and CloudBees. Nonetheless, the company has demonstrated robust growth, claiming over 1,000 enterprise customers, including United Airlines and National Australia Bank. In the past year alone, Harness reported managing 128 million deployments, overseeing 81 million builds, and mitigating 1.2 trillion API calls, while facilitating $1.9 billion in cloud spending optimization.
Based in San Francisco, Harness employs more than 1,200 team members across 14 global offices, with a significant presence in India where it has its largest development center in Bengaluru. The company plans to utilize its new funding to accelerate research and development, recruit additional engineers for its Bengaluru office, and enhance its automated testing, deployment, and security capabilities.
In a strategic move earlier this year, Bansal merged his observability company Traceable with Harness, which has fortified the startup’s projected annual recurring revenue (ARR). Bansal noted that the convergence of DevOps and application security is driving significant growth for their offerings.
While this recent funding round has provided financial liquidity for employees, Bansal indicates that an initial public offering (IPO) remains on the horizon, although no specific timeline has been disclosed. “Our business is very healthy, with promising growth and margins, making it well-positioned for public company status when the time is right,” he stated.
