Software asset management, an area of enterprise IT designed to reduce costs for businesses, continues to attract significant funding in its own right. In the latest development, Xensam, a Stockholm startup that offers AI-based tools that help companies understand and track how and where their software is used, has raised $40 million, marking an eight-year It raised its first external funding since its previous founding.
The funding will come from a single investor: London-based Expedition Growth Capital. Oskar Fösker, CEO of Xensam, who co-founded the company with his brother Gustav (CTO), continues to develop the AI technology stack, hire more talent (currently 100 employees), and expand the U.S. He said this technology will be used to expand into market.
The valuation was not disclosed, but Fosker said he and his brother remained major shareholders. The company itself has 200 customers, including major companies such as Volvo Polestar and Northvolt, and its annual recurring revenue is growing at 126% every year, but the actual revenue The number has not been disclosed.
The world of software access management (sometimes called software expense management or license management by others in the field) is a complex world, especially because the problems we're tackling are big and we're tackling them for multiple reasons. It's the world.
Organizations around the world will spend nearly $900 billion on enterprise software in 2023, and with the explosion of cloud computing and software sold as a service, large organizations will be spending hundreds or even thousands of dollars on enterprise software. Some officials estimate that it could hold different licenses. That roof.
This can impact an organization's business spend, productivity, security, and many other areas, which is why startups and large technology companies are rushing to the challenge of tracking and understanding the big picture of their organization. It's not surprising that we see people trying to deal with it. What is used, where and why?
Xensam itself began with that competition. Both founders previously worked at another company, Snow Software, which is a major player in the space, and in their opinion, the company was expanding rapidly but needed to better track SaaS usage. They say they have lost pace when it comes to cutting-edge developments, such as the use of AI to .
“After a while, it became clear that there was a hole in the market, but no one showed any intention of filling it,” Oscar said. “This Hall was going to be the industry's first native SaaS player.” A side note to Snow talking about the potential valuation in this space: One of Snow's biggest competitors is a company called Flexera, which last year Flexera acquired Snow after it was reported that Snow was considering a sale for about $1 billion. Meanwhile, Flexera's last valuation was in 2020 at nearly $3 billion. Other big deals in the space include his nearly $4.7 billion acquisition of Apptio by IBM.
Xensam's approach uses AI to comprehensively scan and understand what's happening across an organization's network, potentially across thousands of applications in both cloud and on-premises environments. to understand the situation in real time.
“We use AI in different parts of our technology,” Fosker said. “We use this to process huge amounts of data in our software normalization process,” he explains. This refers to the process by which raw data is normalized into a standardized application with metadata. “This is the main reason why we were able to completely outperform our competitors.” He also uses AI on the front end, with chatbots trained on the company's systems, and software licensing rules. “We can interact directly with the system and provide everything from information from the system to pre-built reports based on open specifications.”
He didn't go into detail about what exactly he plans to launch next or whether he believes there are still holes in the market, but he plans to launch more products in the second quarter. He said that.
Their experience with Snow is also the reason the company has been in business to this day. “We do not believe that a financial structure based on Series A, B, C, etc. for survival is a sound business model. It is based on too many external factors,” he said. Ta. “We knew that in order to be sustainable, we had to be financially stable.”
They ended up getting VC funding because they had already figured out the business model on their own, he said.
“We have seen many companies raise capital and lose their beautiful company culture while all the focus shifts to growth,” he said. “So it was very important to us to find investors who shared our cultural values, which we believe we have at Expedition as well.”
Expedition describes itself as typically the first outside investor in a startup. That means we probably understand the model better than other companies because we work with a lot of bootstrapping founders.
“Zentum is one of the most impressive European growth companies we have ever encountered,” Oliver Thomas, founder and managing partner of Expedition Growth Capital, said in a statement. Ta. “In nearly eight years of operation, we have built important solutions that enable companies with thousands of employees to track, monitor, and manage software usage. We are pleased to be working closely with the company as an external investor and look forward to being part of its growth journey.”