Ex-Splunk executives’ Resolve AI startup valued at $1 billion with Series A

Resolve AI, a startup developing an autonomous site reliability engineer (SRE), a tool that automatically maintains software systems, has raised a Series A led by Lightspeed Venture Partners, according to three people familiar with the deal.

The base valuation for the new round is $1 billion, sources said. However, the actual gross valuation of the company was lower due to a multi-segment structure. In this arrangement, investors bought some equity at a $1 billion valuation, but got the rest—likely a larger percentage of the round—at a lower price. This new investment approach has recently become popular for the most sought-after AI startups, investors say.

The startup’s annual recurring revenue (ARR) is about $4 million, two of the people said. The size of the funding round could not be learned.

Resolve AI and Lightspeed did not respond to our request for comment.

The startup was founded less than two years ago, and is led by former Splunk executive Spiros Xanthos and Mayank Agarwal, Splunk’s former chief observability architect. The duo’s partnership dates back 20 years to their graduate studies at the University of Illinois Urbana-Champaign. This is not their first collaboration. they previously co-founded Omnition, a startup that was acquired by Splunk in 2019.

While human SREs are traditionally responsible for manually troubleshooting and resolving system failures, Resolve AI automates this process by identifying, diagnosing and resolving production issues in real-time.

Automation is a growing challenge for companies. As software systems become more complex and distributed across cloud infrastructures, outfits often struggle to find and retain enough skilled SREs to keep systems running smoothly. Automating these tasks can reduce downtime, reduce operational costs, and free up engineering teams to focus on building new features instead of constantly trying to eliminate production issues.

Last October, Resolve AI raised a $35 million seed round led by Greylock featuring World Labs founder Fei-Fei Li and Google DeepMind scientist Jeff Dean.

Resolve AI competes with Traversal, an AI startup SRE highlighted a $48 million Series A; led by Kleiner Perkins, with input from Sequoia.