Harness reaches $5.5B valuation with $240M raise to automate AI ‘post-code’ gap

DevOps AI tool Harnessfounded by serial entrepreneur Jyoti Bansal in 2017, is on track to exceed $250 million in annual recurring revenue in 2025, Bansal told TechCrunch.

The startup just raised new Series E funding of $240 million, valuing the company at $5.5 billion after the money.

The round includes a $200 million seed investment led by Goldman Sachs and a planned $40 million tender offering with participation from IVP, Menlo Ventures and Unusual Ventures. Bansal said the tender offer is aimed at providing some liquidity to its employees in the long term.

The new valuation is a 49% jump from its value Valuation: $3.7 billion In a $230 million round in April 2022. With this funding, the startup has raised $570 million in equity so far.

As AI accelerates code production, it widens the bottleneck in the much larger “post-code” phase of software development — testing, security checks, and deployment work that still consumes roughly 70% of engineering time. Harness tools help automate this sprawling, error-prone layer, even as organizations face rising AI code volumes and the risks of shipping even a single line of faulty software to production systems.

Bansal is known among developers for building and selling an application performance company AppDynamics to Cisco for $3.7 billion In 2017. So the world of post-code is a field that Bansal knows well.

Harness uses AI agents to automate functions such as testing, verification, security, and governance. It is built on a software delivery knowledge graph that maps code changes, services, deployments, tests, environments, incidents, policies, and costs. The knowledge graph helps differentiate Harness from other AI platforms, Bansal said, because it gives the system a deep understanding of each customer’s software delivery processes and architecture.

“This knowledge graph is the context that our AI agents use,” he told TechCrunch.

Purpose-built agents rely on this context to create pipelines that align with each agent’s specific policies, architecture, and operational requirements.

Harness also uses an orchestration engine that turns AI recommendations into automated actions, with checks in place to ensure those changes are applied safely.

Since AI is not foolproof, Bansal said the system is designed with human oversight, noting that AI-generated tests or fixes are reviewed by engineers, compliance teams or auditors before being put into use.

Microsoft’s GitHub, GitLab, Jenkins, and CloudBees are among Harness’s main competitors. But Harness has a lot of appeal, with more than 1,000 institutional clients, including United Airlines, Morningstar, Keller Williams and National Australia Bank. To date, the startup has processed 128 million deployments, 81 million builds, protected 1.2 trillion API calls, and helped customers optimize $1.9 billion in cloud spending over the past year, Bansal says.

The San Francisco-based company employs more than 1,200 people in 14 offices around the world, including Europe and the United Kingdom. About 33% of its workforce is based in India, where it has a large engineering team in Bengaluru and a corporate office in Gurugram. Furthermore, the Bengaluru site is Harness’ largest development center outside the US

Harness plans to use the new funding to expand its R&D efforts, hire “hundreds of engineers” at its Bengaluru office, and build additional capabilities for automated testing, deployment and security while improving the accuracy of its AI systems. The company also intends to strengthen its operations in the US markets and significantly expand its presence in international markets.

It should also be noted that earlier this year, Bansal He incorporated his own software monitoring company Traceable With Harness, the move has helped the startup grow its ARR forecast.

“We brought the two companies together because we started to see that DevOps and application security come together in a very profound way,” Bansal said. “We’ve seen that thesis be very successful this year…and that’s driving a lot of growth for both the DevOps and application security product portfolio.”

While the raise has allowed some employees to make a little more money, Bansal still plans to take Harness public someday, though he didn’t share a specific timeline.

“That’s what our goals and plans depend on,” he said of the eventual IPO. “Our business is very healthy, very strong, has high growth and margins, and will be a great public company when the timing is right.”