Factory.ai raises $150M

Factory said on April 16 it raised $150 million in a Series C round to build software “Droids” that write code, run tests, and ship changes for enterprise teams. (factory.ai) Khosla Ventures led the round, with Sequoia Capital, Blackstone, Insight Partners, Evantic Capital, 20VC, NEA, and Mantis VC also participating. Factory said the financing values the company at $1.5 billion. (factory.ai) The company says its agents are meant to handle long chains of engineering work, not just autocomplete a few lines of code. Factory’s pitch is that one platform can route work across different underlying models and interfaces, from the command line to chat tools and browsers. (factory.ai 1) (factory.ai 2) That puts Factory in the busiest corner of the artificial intelligence market: tools that move from helping developers draft code to taking on testing, migrations, code review, and deployment work inside large companies. TechCrunch said rivals in that race include Anthropic’s Claude Code, Cursor, and Cognition. (techcrunch.com) Factory’s own numbers show how fast investors expect that market to grow. The company raised a $50 million Series B at a $300 million valuation on September 25, 2025, then announced this new round less than seven months later at five times that valuation. (factory.ai 1) (factory.ai 2) The startup was founded in 2023. TechCrunch reported that founder Matan Grinberg started the company after cold-emailing Sequoia partner Shaun Maguire while Grinberg was a doctoral student at the University of California, Berkeley. (techcrunch.com) Factory says its tools are already used by hundreds of thousands of developers and names Nvidia, Adobe, EY, Palo Alto Networks, and Adyen among enterprise users. TechCrunch separately reported customers including Morgan Stanley, Ernst & Young, and Palo Alto Networks. (factory.ai) (techcrunch.com) The company has also been pushing deeper into big corporate delivery pipelines. In January, Wipro said it would roll out Factory across tens of thousands of engineers and sell Factory-enabled services to clients in banking, healthcare, manufacturing, retail, and technology. (factory.ai) Factory has been building around that enterprise case with product work on “agent readiness,” context compression, analytics, and a desktop app, plus participation in the OpenAI-backed AGENTS.md effort for coding-agent standards. Those are the pieces companies usually ask for before they let autonomous systems touch production software. (factory.ai) The new funding gives Factory more room to prove that a “virtual engineer” can do more than generate code on command. Its next test is whether large companies will trust those agents to keep running, safely and cheaply, across the full software pipeline. (factory.ai)