PostHog Secures $70M Series D Funding to Revolutionize Customer Data Infrastructure with AI

Meet PostHog, A Startup That Just Raised A $70M Series D Led By Stripe From A Single Tweet

Y Combinator, GV and Formus Capital also participated in the financing, which brings PostHog's total raised since its 2020 inception to about $107 million, per Crunchbase data. In a nutshell, PostHog started as a product analytics tool. Over the years, it has evolved with the mission of giving businesses "full control" of their customer data with its open-source platform. Notably, PostHog's Series D amounts to more than double of all the capital it had previously raised combined. Its new valuation also is roughly double its valuation at the time of its $15 million Series B in 2021, according to co-founder and co-CEO James Hawkins. Series D rounds aren't necessarily remarkable in and of themselves these days, and neither are near-unicorn valuations. But what stands out about this round is the way it came about. One day in November 2023, Stripe co-founder and CEO Patrick Collison "just out of the blue tweeted" about PostHog's site "being cool," said Hawkins. (Specifically, Collison said the site was "very well done," and tagged Hawkins and Tim Glaser, PostHog's other co-founder and co-CEO.) The company took the compliment as a way to get in front of Collison, and asked for a meeting. "We did so and just talked about a bunch of topics that were on our mind," Hawkins told Crunchbase News. "We got really excited about working together." Stripe declined to comment on its leading PostHog's latest raise, although it did confirm its investment. GV general partner Crystal Huang said her firm was so impressed with PostHog's potential to "unify a fragmented developer tools landscape" that it has invested in every round since leading PostHog's $9 millionSeries A in 2020. "PostHog's ambition to automate the entire development stack with AI, from data warehousing to LLM observability and beyond, represents a significant leap forward for builders," she said. "We believe this integrated approach empowers developers to innovate faster and with greater confidence." "Their modular offerings and transparent pricing have resonated deeply with customers. The ability to ship full product stacks, including a platform that delivers the most complete customer data, highlights the strength of their approach. At a time when developers need more than a collection of disconnected tools, PostHog provides a cohesive AI-powered environment that reduces complexity, accelerates product velocity, and drives measurable business results." Full-stack approach Hawkins and Glaser started working on PostHog during Y Combinator's Winter 2020 batch. The company focused on just open source software (vs. revenue) for the first year and a half. Today, PostHog provides what Hawkins describes as "customer infrastructure." "This means every single customer-related software product in one place," he explained. "The end result is a perfect customer data record without any integrations needed. This starts from day one of a startup, when the first line of code is written and that's when we get in -- with developers. We're then upstream of every piece of software they'll ever buy." Currently, PostHog, which is San Francisco-based but fully remote, has 14 products aimed mostly at product and engineering use cases to help those teams better understand and work with customers. As with many other startups, artificial intelligence has led to PostHog starting to automate those products with a new platform that is generally available as an open beta: Max AI. Hawkins declined to reveal hard revenue figures, saying only that PostHog has "multiple $10s of millions of ARR and 3x year-over-year growth." He claims that the company is seeing its growth rate increase over time. Users include Y Combinator, 1Password, Mistrial AI, Airbus and Eleven Labs, among others. While PostHog is not profitable, Hawkins said the company has been cashflow positive both late last year and in recent months. It had about 80 employees at the end of 2024. Its goal is to one day "ship the entire stack of tools that relate to sales, support, or marketing -- basically anything that relates to customer data. ... then we'll automate all of it with AI," he said. Stripe as investor Stripe is one of the world's most valuable private companies and believed to be the most valuable private fintech company. In February, it announced a tender offer in which investors would buy shares from past and present employees at a valuation of $91.5 billion.

PostHog raises $70M to streamline software development projects - SiliconANGLE

Payment processing provider Stripe Inc. led the Series D investment. It was joined by Alphabet Inc.'s GV startup fund, Formus Capital and Y Combinator, which incubated PostHog in 2020. The company is now reportedly valued at $920 million. PostHog sells a suite of software tools that companies can use to improve their applications and websites. Several of the tools focus on easing the process of rolling out new features to an online service's users. PostHog's other products, in turn, ease data management tasks such as collecting information about an online store's churn rate. Before developers modify an application, they often test the update with a limited number of users to find issues. One of PostHog's tools makes it possible to carry out such tests using feature flags. Those are code snippets that enable developers to quickly roll back a software update if a bug is found. In some cases, a company might wish to test multiple versions of a new feature before making it generally available. PostHog provides a tool for that task as well. A software team could use the tool to test three different variations of a new interface design and deploy the one that garner the most positive feedback. PostHog's tools also ease the task of collecting data on how customers react to software updates. Developers can track the number of users who interact with a new feature, the amount of time they spend doing so and related metrics. Software teams that require additional information can create in-app surveys. According to PostHog, its data collection and analysis tools are also useful for identifying user experience problems. They highlight issues such as interface malfunctions that negatively affect engagement. After finding a potential bug, developers can use a so-called session replay tool to gather more information. The tool simulates how users interact with a faulty feature and generates a video of the simulated interaction to ease analysis. PostHog's product portfolio also spans several other use cases. It provides a CDP, or customer data platform, that can stream information about a company's users to analytics platforms. Another tool can be used to collect performance and cost metrics about large language models. On occasion of the new funding round, PostHog detailed that its sales have more than tripled over the past year thanks to strong demand for its tools. The company's annual recurring revenue is now in the tens of millions of dollars. It counts Mistral AI SAS and Y Combinator among its customers. PostHog will use some of the new funding to enhance Max AI, an artificial intelligence assistant that ships with its tools. Currently, the assistant can answer questions about the company's products and perform a limited number of other tasks. PostHog plans to build a version of Max AI that will be capable of creating feature flags and A/B tests.