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GoingVC Partners: Why We Invested in Launchable

GoingVC Partners is the investment vehicle of GoingVC. Interested in co-investing? Join GoingVC Angels for access to high-quality, pre-diligenced deal flow and opportunities like this. For more about GoingVC Partners, click here.

Executive Summary

We’re delighted to announce our newest investment in Launchable’s Series-A round led by 645 Ventures. GoingVC Partners cannot be more excited to partner with Kohsuke, Harpreet, and the entire Launchable team to build a category-defining DevOps platform. Here is a bit more about the business, opportunity, and why we invested.

Launchable is a cloud-based DevOps product — a test recommendation engine that uses machine learning to speed up CI pipelines and reduce testing cycle times by selecting the right tests to run at the right stage of the development workflow. The product is priced as a SaaS offering with multiple tiers — freemium, $20/developer/month, and an enterprise tier.

Why We Love It: Launchable

Rockstar Team

With deep domain expertise, a demonstrated history of successfully launching products in DevOps, and the experience of building another startup together — the founding team has worked alongside each other for over 15 years, having launched the first Continuous Delivery Pipeline (Jenkins) product in the market at CloudBees that catapulted the company from $0 to $50M ARR.

  • Kohsuke Kawaguchi (co-founder, co-CEO) was the CTO at CloudBees and is the creator of its’ core product — Jenkins, which is used by over 1M users around the world. Jenkins is the de facto continuous delivery and DevOps orchestration tool
  • Harpreet Singh (co-founder, co-CEO) was VP of Product at CloudBees and Head of Product for Atlassian Bitbucket (NASDAQ: TEAM).
  • Yoshiori Shoji is a well-known thought leader in the Rails community
  • Other Product & Sales team members were formerly at Atlassian or CloudBees.

Top-Tier Investors with Deep Domain Expertise Across Two Funding Rounds

In September 2019, Launchable raised $3.2M from top-tier investors with deep domain expertise and a track record of successful exits in the DevOps space. These include venture firms like Battery Ventures (JFrog, AppDynamics, DataBricks), Unusual Ventures (Robinhood, Webflow, Carta), as well as prominent angels (& former colleagues & managers), including Sri Viswanath (CTO of Atlassian), Sacha Labourey (CEO of CloudBees), and others. (Battery is an investor in JFrog, a comparable company in DevOps to Launchable with a similar customer set, which is now valued at over $4B.)

Furthermore, the team at 645Ventures was excited about the opportunity to make a massive impact on developers and led the new round while Battery and Unusual have raised their investments. The company will use the new funds to scale commercial operations for the Enterprise channel and invest more in R&D to accelerate the product roadmap.

Large Market Opportunity

A $2.3 billion TAM for their first product (an ML-based test recommendation engine). An even bigger TAM opportunity of up to $85 billion exists, to solve for inefficiencies in development due to bad code.

Customer Value Proposition

Software / digital is the primary competitive driver for companies across industries, and companies are increasingly investing in tools to increase developer productivity. Software test feedback time is a huge component in development cycle time. Launchable is aiming to reduce test feedback time by 80%, thereby freeing up time spent by developers and QA in waiting for the tests to fully run. In addition to software testing being a huge component of development cycles, it is also a massive bottleneck to getting applications released so it’s critical to increase efficiency by reducing the time spent on testing which Launchable has achieved with its machine learning engine. This enables companies to realize huge cost savings for their development teams over time. According to management, customers recoup their spend on Launchable in merely 2–3 weeks of leveraging the software.

DevOps Transformations in Days, Not in Years

The Launchable platform’s core is a machine learning model that ingests data from development environments and DevOps pipelines to predict the likelihood of failure for each test based on past test runs and underlying source code changes. Model training generally takes 3–10 weeks depending on how frequently tests are run.

Organic Growth driven by a Proven Formula

Launchable plans to build a marketing team that speaks authentically to developers by leveraging its unique experience building the Jenkins community, building CloudBees to $50M ARR, and utilizing playbooks from Atlassian. This strategy will include building strong developer community support and creating educational content and thought leadership in DevOps to drive organic growth to the platform.

Exit Potential

DevOps M&A has been growing throughout the pandemic. According to Forrester and Pitchbook, there were 25+ acquisitions in 2020, and more than $58 billion was generated by IPO’s in DevOps in the first three quarters of 2020, a 28% increase over 2019. Notably, GitHub was acquired by Microsoft for $7.5B while Atlassian and JFrog IPO’d and are valued at $57B and $4B, respectively.

Congrats again to Kohsuke, Harpreet, and the entire team. We’re just getting started!

Are you a founder or investor? We’d love to chat!

For Founders: GoingVC Partners is a sector-agnostic, early-stage investor actively looking to fund strong founding teams. If that sounds like you, we’d love to hear from you!

For Investors: We offer accredited investors the opportunity to co-invest alongside GoingVC Partners through GoingVC Angels. To learn more about the program, click here, or apply to join directly here.

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