Harness hits $5.5 billion valuation with $240 million raise to automate AI's after-code gap

Harness Secures Major Funding to Address Software Delivery Bottleneck

Harness, the AI DevOps platform founded by serial entrepreneur Jyoti Bansal in 2017, has raised $240 million in Series E funding that values the company at $5.5 billion post-money 1

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. The 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 2

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. This represents a 49% jump from its $3.7 billion valuation in April 2022, bringing the software delivery startup's total equity funding to $570 million 1

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The San Francisco-based company is on track to exceed $250 million in annual recurring revenue in 2025, marking more than 50% year-over-year growth 3

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. This makes Harness larger than AppDynamics at the time Bansal sold that company to Cisco for $3.7 billion in 2017 2

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Targeting the 70% of Engineering Work After Code

While AI tools accelerate code production, they're widening a critical bottleneck in after-code software development—the testing, security checks, and deployment work that still consumes nearly 70% of engineering time 1

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. Jyoti Bansal explains the challenge: "The first 30% or so is the coding work. Once you finish writing the code, one small glitch in the code, or one bug, can bring the whole business down. But the next 70%, if you don't remove the bottleneck, you really can't deliver the code" 3

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Harness uses AI agents to automate functions like testing, verification, security, and governance across the software delivery lifecycle 1

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. The platform is built on a Software Delivery Knowledge Graph that maps code changes, services, deployments, tests, environments, incidents, policies, and costs, providing unified context that helps AI actions become more precise 3

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. An orchestration engine then turns AI recommendations into automated actions with safety checks to ensure changes are applied correctly 1

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Deepening DevSecOps Integration Through Strategic Merger

Earlier this year, Bansal merged his enterprise cybersecurity startup Traceable with Harness, a move that has significantly contributed to the company's ARR projection 1

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. "We brought the two companies together because we started to see that DevOps and application security are coming together in a very, very deep way," Bansal said, noting this thesis has driven substantial growth for both DevOps and application security products 1

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. The combined company now has approximately 1,300 employees 2

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Harness claims more than 1,000 enterprise customers, including United Airlines, Morningstar, Keller Williams, and National Australia Bank 1

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. Over the past year, the platform has handled 128 million deployments, 81 million builds, protected 1.2 trillion API calls, and helped customers optimize $1.9 billion in cloud spending 1

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Aggressive Expansion Plans with Focus on India

Harness plans to use the new funding to expand R&D efforts and hire "hundreds of engineers" at its Bengaluru office, which serves as the company's biggest development center outside the U.S. 1

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. "We are hiring aggressively in India across roles such as software engineers, AI researchers...and should have around 600-700 employees in India this year," Bansal told The Economic Times 4

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. Around 33% of Harness's workforce of over 1,200 people across 14 offices worldwide is based in India 1

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The company also intends to strengthen its U.S. go-to-market operations and expand significantly in international markets while building out additional deployment automation, testing, and security capabilities 1

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. The $40 million tender offer provides liquidity to long-term employees, while Bansal said the $200 million primary capital provides enough runway to become cash flow positive 4

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Path to IPO and Long-Term Vision

Unlike his previous exit with AppDynamics, Bansal is aiming for a different outcome this time. "I'm a believer that at the right market timing, we want to operate as a public company, so we can build for the long term," he said 2

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. While he didn't share a specific timeline for an IPO, Bansal emphasized that the business fundamentals are strong: "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" 1

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. He expects this to be the last private funding round, stating they don't see the need to raise more capital before achieving cash flow positivity 4

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