BigPanda, a startup developing AI to audit changes in IT environments and recommend how to fix them, has raised $20 million in an extension of its Series E round. UBS Next and Wells Fargo Strategic Capital contributed to the tranche, bringing BigPanda’s total raised to $340 million. The company’s valuation remains unchanged at $1.2 billion.
As my colleague Christine Hall recently reported, BigPanda works to prevent corporate network outages by analyzing data from observability and monitoring services. The platform can automate aspects of incident response, like ticketing, and optionally connect to third-party runbook automation tools to run automated workflows. BigPanda also provides analytics to track incident trends and metrics and to enable teams to measure progress toward company goals.
BigPanda was founded in 2012 by Assaf Resnick and Elik Eizenberg. Resnick was an analyst at Moody’s before becoming a principal at Sequoia Capital and a member at Jibe Ventures. Eizenberg, formerly head of IT operations at IDF, worked on algorithms and software at stock-trading startup MarketWindows prior to joining BigPanda.
“In 2011, Eizenberg and I had launched an adtech company built on a very modern and sophisticated cloud infrastructure,” Resnick told TechCrunch via email. “However, like many companies, we started running into issues keeping services running in that complex environment. With more monitoring data than we could humanly process, and yet no insights as to what was causing performance issues or outages, we quickly built a tool to help them identify incidents as they were happening. That’s when we realized there was a bigger unmet need we wanted to solve.”
Resnick believes the capital infusion — particularly during this tough economic climate — highlights the demand for BigPanda and AIOps, or software that correlates events in IT systems. To his point, the AIOps market grew rapidly during the pandemic, particularly as the worker shortage in IT worsened. Gartner predicts 40% of companies will be using AIOps for app and infrastructure monitoring by 2023.
BigPanda competes for AIOps dominance with startups like ScienceLogic, Coiled and OpsRamp. And in recent months, larger vendors have entered the ring. New Relic expanded its AIOps services with the launch of an anomaly detection service last March, and ServiceNow — signaling its ambitions — acquired AIOps vendor Loom Systems in January 2020.
“COVID-19 forced organizations to modernize or suffer the consequences. This economic recession will force companies to do more with less,” Resnick said. “While we sit in the broad category of AIOps with a dozen other vendors, there is no competitor singularly focused on delivering vendor-agnostic event correlation and automation to improve incident management.”
BigPanda claims to have 100 customers, including strategic clients like UBS and Wells Fargo. Revenue remains “under $100 million” with an 80% gross margin profile, in line with the figures Resnick gave TechCrunch in January.
Part of the new cash will go toward hiring, Resnick says. BigPanda plans to exit 2022 with over 350 employees, up from its current headcount of 330.