Back in Action + Deal Announcement

Agnostiq, DataRobot, TrueFoundry, Traceable, Harness, CyberArk, Zilla Security, Sardine, Positron AI, DoiT, PerfectScale, SolarWinds, TrendMicro, Suger, Nirmata

Hello Dear Readers! Sorry, I was away for a while - busy with a transaction, holidays and work travel. Deal activity was slow in January but things have picked up over the last two weeks. Let's dive in.

DataRobot Picks Agnostiq to Supercharge Enterprise Agentic AI

One of the reasons for the lack of updates to InfraRead was that I was busy working on a transaction. I advised Agnostiq , an incredible AI Infrastructure orchestration platform on its sale to DataRobot . The deal was announced one earlier this week. Agnostiq is the company behind Covalent - a Pythonic framework for deploying and managing applications on diverse, highly complex compute environments. Read more about how Agnostiq powers Agentic AI for Enterprises in this detailed blog post by DataRobot.

Below are a few other announcements from the last couple of weeks that caught my eye.

TrueFoundry Raises $19 Million to Accelerate MLOps Platform

TrueFoundry has raised $19 million in Series A funding, led by Intel Capital to expand its AI deployment platform. Existing investors Eniac Ventures and Peak XV Partners ’s Surge participated, along with Jump Capital . Notable angel investors participating in the round include Gokul Rajaram , Cyan Banister and Mohit Aron .

TrueFoundry’s platform streamlines AI deployment, automating infrastructure management and ensuring seamless integration across cloud and on-prem environments.

AI infrastructure orchestration, model management and MLOps has seen a wave of acquisitions over the last six months. 英伟达 acquired OctoAI (Acquired by NVIDIA) in September 2024, and closed its acquisition of GPU optimization platform Run:ai (Acquired by NVIDIA) in December 2024. Run:ai will be open-sourced to drive cross-platform development and adoption. 红帽 purchased Neural Magic (Acquired by Red Hat) to improve AI inference capabilities. And of course, DataRobot just announced its acquisition of my client Agnostiq as discussed above.

Keenly watching this space to see how the independent builders ( TrueFoundry , BentoML Replicate , Together AI , Fireworks AI , Modal , etc.) compete and create value for their enterprise customers.

Traceable and Harness Combine to Form a DevSecOps Power Player

Harness and Traceable by Harness have announced a merger, creating a new powerhouse in AI-driven DevSecOps. The move integrates software delivery and security into a unified platform, reflecting the ongoing demand for convergence of DevOps with application security.

Harness is known for its AI-native software delivery platform, and Traceable by Harness is a leader in API security. Both originated from BIG Labs, a startup studio founded by Jyoti Bansal . Initially separate businesses, their overlapping customer demands and the increasing industry shift toward integrating security within the development pipeline made the merger a strategic next step.

The rise of Agentic AI and automated software development has increased the pressure on engineering teams to deploy applications faster while maintaining robust security. Traditionally, DevOps and security teams operated in silos, but the industry’s rapid shift toward embedding security into the software development lifecycle has created demand for a unified approach. The global DevSecOps market is expected to grow at nearly 25% annually, reaching $46 billion by 2032.

The combined company will operate under the Harness brand, bringing together its expertise in software delivery with Traceable by Harness 's deep insights into API security. By integrating security into every stage of development, the new platform aims to help enterprises deploy software faster while reducing vulnerabilities. AI-native security and delivery automation will be a core focus, leveraging data from both platforms to enhance efficiency.

With more than 1,400 employees and projected annual recurring revenue exceeding $250 million, the merged entity is positioned as one of the fastest-growing private software companies. The integration process will focus on platform unification, streamlining security and DevOps workflows, and expanding AI-driven capabilities.

Harness has raised a total of $575 million in funding, while Traceable by Harness has raised another $110 million. I discussed Harness' last funding round here. Traceable had raised a $30 million round around the same time. The combined business is projecting ARR of $250+ million this year, growing at over 50% year over year. That puts their current combined ARR at about $150 - 175mm. Note that Harness claimed $100+ million in ARR when they announced their last financing in May 2024. I'd attribute about $120-130 million of the current ARR to Harness , and the rest to Traceable by Harness .

CyberArk Acquires IGA Platform Zilla Security

CyberArk has acquired Zilla Security a provider of modern Identity Governance and Administration (IGA) solutions, for $165 million, with an additional $10 million earn-out tied to milestone achievements. The acquisition enhances CyberArk’s Identity Security Platform with AI-powered automation for identity compliance and provisioning, strengthening security and operational efficiency across digital environments.

Zilla Security was founded by Deepak Taneja who did early work IGA with Aveksa more than twenty years ago, and sold the company to RSA in 2013. Deepak served as the Identity CTO of RSA after Aveksa's acquisition. Zilla's IGA SaaS platform automates identity compliance, provisioning, and security. The acquisition marks a major step in CyberArk’s vision to unify identity security.

Zilla Security had raised $13.5 million in Series A funding from Tola Capital , FirstMark , and Pillar VC . The company had grown rapidly since its market entry in 2021, helping enterprises automate security and compliance across SaaS and hybrid environments. Nice outcome for the team.

Sardine AI Raises $70M to Enhance Fraud and Compliance Operations

Sardine , an AI-powered platform for fraud, compliance, and credit underwriting, has secured $70 million in a Series C funding round, bringing its total capital raised to $145 million. The round was led by Activant Capital with backing from major investors including Andreessen Horowitz and GV (Google Ventures) . Sardine has experienced remarkable growth, with a 130% YoY ARR increase in 2024 and a customer base that includes over 300 enterprises including FIS , Ascensus and GoDaddy .

Sardine aims to address the growing workload of risk teams, who face an 800% surge in alerts and increasing pressure to manage manual reviews. By leveraging AI, Sardine ’s platform automates key aspects of fraud detection and compliance, enhancing operational efficiency and reducing false positives. This includes introducing AI agents for tasks like KYC onboarding, sanctions screening, merchant risk assessment, and chargeback management.

With over 2.2 billion devices profiled, Sardine 's AI agents help teams work faster, focus on high-priority issues, and maintain regulatory compliance. This solution offers a scalable way for financial institutions to manage risk while driving revenue growth and improving customer retention.

Positron Raises $23.5M to Scale U.S.-Made AI Chips

Positron AI , a Reno-based semiconductor startup, has raised $23.5 million in funding to scale production of its energy-efficient AI chips, positioning itself as an alternative to NVIDIA ’s dominant AI hardware. Investors in the round include Valor Equity Partners , Atreides Management, LP , Flume Ventures , and Resilience Reserve. The funding will support Positron’s expansion as it continues shipping its U.S.-manufactured chips to data centers and cloud providers.

The company’s AI inference chips, designed to optimize power efficiency and cost-effectiveness, have shown performance improvements over 英伟达 ’s H100 GPUs in inference workloads. Positron’s Atlas systems, which rely on a memory-optimized architecture, are reportedly achieving 3.5 times better performance per dollar and significantly higher power efficiency compared to NVIDIA’s offerings. The chips, built with FPGA-powered technology, are compatible with widely used AI frameworks such as Hugging Face and OpenAI APIs, making them accessible to enterprises looking to scale their AI infrastructure.

Leading the company’s next phase of growth is newly appointed CEO Mitesh Agrawal , who previously played a key role in scaling Lambda , a prominent GPUaaS platform. He joins co-founders Thomas Sohmers and Edward Kmett in advancing Positron’s efforts to develop AI hardware domestically. The company emphasizes its fully U.S.-based supply chain, with design, fabrication, and assembly occurring within the country—an approach that aligns with broader efforts to reduce reliance on foreign semiconductor manufacturing.

Positron is joining a number of hardware startups aiming to address the high-power, high-cost challenges of current-generation machine learning and inferencing workloads. Positron’s architecture is designed to alleviate these challenges, offering data centers a way to integrate AI capabilities without requiring costly infrastructure overhauls. Other key players in the area include Playground Global backed d-Matrix and NextSilicon , Tiger Global Management backed Groq and Foundation Capital backed Cerebras Systems .

With its latest funding, Positron plans to expand shipments of its first-generation Atlas systems and accelerate development of its second-generation accelerators, slated for release in 2026.

Cloud Optimization Platform DoiT Acquires PerfectScale

DoiT , a global cloud optimization firm, has acquired PerfectScale, a three-year old startup specializing in Kubernetes cost optimization and governance. The acquisition aims to bolster DoiT’s capabilities in managing and optimizing containerized workloads, a growing challenge as enterprises scale their cloud infrastructure. With Kubernetes adoption increasing, organizations are seeking solutions that balance system performance, reliability, and cost-effectiveness.

PerfectScale, founded in September 2021, has gained traction for its autonomous Kubernetes optimization technology. The company had raised $9.6 million in funding from investors including Blumberg Capital , UpWest , and Prelude Ventures . Its platform provides continuous resource optimization, helping organizations eliminate inefficiencies while maintaining application performance. Clients such as Paramount Pictures have reported cost savings and improved application resiliency through the use of PerfectScale’s technology.

DoiT’s acquisition follows its recent purchase of DoiT (previously LiveDiagrams) , a cloud infrastructure visualization tool, as the company continues expanding its FinOps capabilities. While PerfectScale will continue to operate independently, its technology will integrate with DoiT Cloud Intelligence, providing customers with automated cost management and performance enhancements across multi-cloud environments.

A recent deal in the space was the acquisition of Kubecost by IBM in September 2024. Other players to watch are ProsperOps (raised $72M) CloudZero ($63M), and Yotascale ($25M). The last round of consolidation in this space was around 2018 - 2022 when Cloudability (Apptio), CloudHealth (Vmware), CloudCheckr (NetApp) and Granulate (Intel) were acquired.

Also Read

SolarWinds has agreed to be acquired by Turn/River Capital in an all-cash transaction valued at approximately $4.4 billion, or $18.50 per share, representing a 35% premium to its 90-day volume-weighted average price. The deal, unanimously approved by SolarWinds' board, is expected to close in Q2 2025, after which the company will be privately held. Major shareholders Thoma Bravo and Silver Lake , holding 65% of voting securities, have approved the acquisition.

I was part of the J.P. 摩根 team that advised SolarWinds on its last take-private in February 2016.

Milana Vinn reports 趋势科技 is being pursued by Bain Capital and EQT Group . KKR may be in the hunt as well.

Suger announced a $15 million Series A round led by Threshold Ventures , with participation from Craft Ventures , Intel Capital , and Y Combinator . Founded by Jon Yoo and Chengjun Yuan , Suger simplifies selling SaaS products on cloud marketplaces like AWS and Azure by automating listings and integrating with billing and CRM tools. Since launching in late 2022, the company has grown to over 200 customers, including Snowflake and 英特尔 . Competing with players like Tackle.io , Suger differentiates itself by offering broader automation beyond just listings. The company aims to expand its product and eventually build tools for buyers to streamline enterprise software procurement.

Nirmata , the company behind Kubernetes security and policy automation engine Kyverno has raised $9.6 million in funding, led by Peak XV Partners 's Surge . Nirmata started life as a container orchestration platform, subsequently pivoting to policy automation with the success of the Kyverno project.

If you found this useful, please share, comment and like the newsletter - it helps us grow!

To continue receiving updates, please click here to subscribe to InfraRead.

My day job is advising growing companies on corporate strategy, finance and M&A. If you are looking for an experienced partner with a track record of maximizing outcomes, let's find a time to talk.