Bootstrapped for 8 years, Xensam has now snapped up $40M for AI that manages software program property

Software program asset administration — an space of enterprise IT designed, partially, to assist firms get monetary savings — continues to attract some huge cash itself. Within the newest growth, Xensam — a startup out of Stockholm that gives AI-based instruments to assist companies perceive and monitor the place and the way software program is getting used — has raised $40 million, its first exterior funding since being based eight years in the past.

The funding is coming from a single investor, Expedition Development Capital out of London. Oskar Fösker, Xensam’s CEO who co-founded the corporate along with his brother Gustav (the CTO), stated it will likely be used to proceed creating its AI know-how stack, to rent extra individuals (it’s now at 100 workers) and to interrupt into the U.S. market.

The valuation shouldn’t be being disclosed, however Fösker stated he and his brother stay majority shareholders. The corporate itself has 200 prospects — one of many larger names together with Volvo’s Polestar and Northvolt — and annual recurring revenues are rising at 126% yearly, however it’s additionally not disclosing precise income numbers.

The world of software program entry administration, which others within the house generally name software program expense management or license management, is a crowded one, not least as a result of the issue getting tackled is a giant one, and it’s being tackled for a number of causes.

Almost $900 billion was spent globally by organizations on enterprise software program in 2023, and a few within the subject have estimated that, because of the explosion in cloud computing and software program bought as a service, a bigger group can have a whole lot and even hundreds of various licenses below its roof.

That may have implications throughout disparate areas like enterprise spend, productiveness and safety for that group, so it’s no shock that we’ve seen a rush of startups and bigger tech firms dashing to handle the problem of making an attempt to trace and perceive the larger image of what’s getting used, the place, and why.

Xensam itself acquired its begin out of that aggressive fray. The 2 founders beforehand labored at one other firm known as Snow Software program, a giant title on this house, which was scaling quick however dropping tempo, of their opinion, when it got here to leading edge developments, reminiscent of using AI to higher monitor SaaS utilization.

“After a while it was clear that a hole was about to open up in the market, and no one showed any intentions to fill it,” Oskar stated. “This hole was to be the first, native SaaS player in the business.” Sidenote to Snow that speaks to potential valuations on this house: certainly one of Snow’s largest rivals was an organization known as Flexera, and final 12 months Flexera acquired Snow after it was reported that Snow was trying to promote itself for around $1 billion. Flexera in the meantime was final valued at nearly $3 billion in 2020. Different massive offers on this space have included IBM shopping for Apptio for almost $4.7 billion.

Xensam’s strategy is to make use of AI to comprehensively scan and perceive what’s going on throughout a corporation’s community, giving an actual time image of hundreds of functions that may be in use throughout each cloud and on-premise environments.

“We’re using AI for various parts of the technology,” Fösker stated. “We’re using it to handle extreme amounts of data in the software normalization process,” which he describes as the method the place uncooked knowledge will get normalized into standardized functions that’s populated with meta knowledge. “This is the key reason why we’ve been able to completely beat the competition.” He stated that it’s additionally utilizing AI within the entrance finish with a chatbot educated on its system and software program licensing guidelines “can interact directly with the system and provide everything from information from the system to prebuild reports based on an open specification.”

He doesn’t go into element round what, precisely, it plans to launch subsequent, or the place it believes there stay holes out there, however stated that it plans to launch extra merchandise in Q2.

Their expertise at Snow can also be why the corporate bootstrapped its enterprise to date. “We don’t believe that a financial structure based on a Series A, B, C etc. for survival is a sound business model. It is based on too many external factors,” he stated. “We knew we would have to be financially stable… to be sustainable.”

The flip to finally taking VC cash, he stated, was as a result of that they had found out the enterprise mannequin on their very own already.

“We’ve seen many companies raising money and losing a beautiful company culture while all focus is being changed to growth,” he stated. “Therefore, it was very important for us to find an investor that also shared our cultural values, which we believe we have in Expedition.”

For its half, Expedition describes itself as sometimes the primary exterior investor in startups — that means it really works with plenty of bootstrapped founders so understands that mannequin maybe higher than some others.

“Xensam is one of the most impressive European growth companies we’ve come across,” Oliver Thomas, founder and managing companion at Expedition Development Capital, stated in a press release. “In the nearly eight years they have been operating, they have built a critical solution which is enabling companies with thousands of employees to track, monitor and manage software usage. We’re delighted to be working closely with the company as their first external investor and look forward to being a part of their growth journey.”