(Bloomberg) -- Qodo, a Tel Aviv-based startup selling artificial intelligence software that tests and finds bugs in code, has raised $40 million to expand the business and service larger customers.
The funding round, led by Susa Ventures and Square Peg, brings the total amount raised by the startup to $50 million, the company said in a statement. It declined to disclose its valuation.
Software engineers are increasingly turning to AI tools like OpenAI’s ChatGPT and Microsoft Corp.’s Copilot to generate code, which is then reviewed by the humans to filter out errors. Because these tools are trained on public repositories of code, there is a risk they can replicate security issues or inject new ones.
“The more AI helps us write code faster, it also increases the surface of risk,” said Itamar Friedman, chief executive officer of Qodo, in an interview.
The potential for small software errors to destabilize major infrastructure came to the fore in July, when a faulty update by Crowdstrike Holdings Inc. crashed millions of computers around the world.
Businesses “absolutely cannot risk embracing a high degree of AI autonomy in software development without having the proper validation and safeguards in place first,” Susa Ventures partner Jenna Zerker said in a statement.
While tech companies tout these tools as increasing productivity, the reliance only “shifts the bottleneck” to the tedious work of manually testing and improving the code, Friedman said.
Since its founding two years ago, more than 1 million developers have installed Qodo’s tool and several Fortune 100 companies have adopted it. The company, formerly known as CodiumAI, also has offices in the US and the Netherlands. It said it reached $1 million in annual recurring revenue this year after releasing its enterprise software.
©2024 Bloomberg L.P.
