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Resolve AI raises funding at $1 billion valuation after just two years

A startup that's barely two years old just hit a billion-dollar valuation with its first major funding round. Resolve AI, founded by two former Splunk executives, has raised a Series A led by Lightspeed Venture Partners that values the company at $1 billion, according to people familiar with the deal.

The company is building what it calls an autonomous site reliability engineer, basically AI software that automatically fixes problems when things go wrong with computer systems. Instead of engineers getting paged at 3am to troubleshoot a crashed server, Resolve AI's system identifies the issue, figures out what's broken, and fixes it on its own.

The founders, Spiros Xanthos and Mayank Agarwal, go way back. They met as graduate students at the University of Illinois 20 years ago and have already built one successful company together. Their previous startup, Omnition, was bought by Splunk in 2019. Both went on to executive roles there before striking out on their own again.

While the headline number is $1 billion, the actual valuation is lower because of how the deal was structured. Investors bought some shares at the billion-dollar price, but most of the round was done at a lower valuation. This multi-tier approach has become trendy lately for hot AI companies.

The company is still quite early, bringing in around $4 million in annual recurring revenue. They're not saying exactly how much money they raised in this round.

This matters because as software systems get more complicated and spread across different cloud services, companies are struggling to find enough skilled engineers to keep everything running smoothly. Automating these maintenance tasks means less downtime, lower costs, and engineers can spend time building new features instead of constantly putting out fires.

Resolve AI isn't alone in this space. They're competing with Traversal, another AI site reliability startup that raised $48 million earlier this year from Kleiner Perkins and Sequoia. Last October, Resolve AI raised a $35 million seed round led by Greylock, with backing from some impressive names including Fei-Fei Li, who founded World Labs, and Jeff Dean from Google DeepMind.