AI testing startup Blacksmith hits $550M valuation

As AI accelerates code generation, the bottleneck is shifting to testing and validation. Blacksmith, a startup that helps companies verify software before it reaches production, has raised a $45 million Series B that values it at $550 million — a nearly tenfold jump from its $60 million valuation less than a year ago.

Series B round details

The Series B was led by Peak XV Partners, with participation from existing investors GV and Y Combinator. The round brings Blacksmith's total funding to $58.5 million.

Founded in 2024, Blacksmith now serves more than 5,000 customers, including Mercury, Supabase, Clerk, Ashby, and Expensify, up from more than 700 customers less than a year ago, co-founder and CEO Aditya Jayaprakash said in an exclusive interview.

The growing bottleneck in AI code validation

The rise of AI coding tools such as Cursor, OpenAI's Codex, and Anthropic's Claude Code has made it significantly easier for software teams to generate code, but the quality of AI-generated code is not a given.

“Validating code is still a bottleneck, and it’s an even bigger bottleneck because people are writing even more,” Jayaprakash said.

Blacksmith started as a cloud provider for continuous integration (CI) workloads, helping companies run the software builds and tests needed to validate code before it reaches production. The startup has since broadened its platform with Codesmith, an AI coding agent that can automatically fix failed code checks.

Measuring up: growth and revenue

Jayaprakash said Blacksmith reached a $10 million annualized revenue run rate with just 10 employees and has since grown its workforce to about 30 and revenue to “tens of millions of dollars.” He declined to provide a specific updated ARR figure, though did say some of its largest customers now spend more than $1 million a year on the platform.

• $45 million Series B led by Peak XV Partners
• $550 million valuation, up from $60 million
• $58.5 million total funding
• 5,000+ customers
• $10 million annualized revenue run rate with 10 employees
• Workforce grown to about 30

Competing in a crowded market

Blacksmith is operating in a crowded market. Its key competitors include GitHub Actions, Cursor Automations, validation capabilities baked into Codex and Claude Code, numerous other startups, and AI code-testing services offered by Amazon Web Services, Microsoft Azure, and Google Cloud.

Jayaprakash said his startup is competing on the speed of testing code as well as affordability.

Plans for a broader coding suite

Looking ahead, Jayaprakash said that Blacksmith plans to expand into a broader suite of coding tools, aiming to help developers write, validate, and merge software faster.

Why it matters

Blacksmith's rapid growth signals that software teams are struggling to keep up with the volume of code produced by AI assistants. As AI coding becomes more prevalent, the need for efficient validation tools is likely to intensify, opening opportunities for startups like Blacksmith that can streamline the testing process. For companies using AI to generate code, investing in robust testing infrastructure could become as critical as the code generation itself.