Observe, a SaaS observability company reinventing how machine-generated data is stored, managed, and analyzed, announced it has closed a $115 million Series B funding round led by Sutter Hill Ventures. Existing investors Capital One Ventures and Madrona participated, and new investor Snowflake Ventures participated.
The Series B funding—raised at a valuation ten times higher than the company’s Series A round four years ago—will further accelerate Observe’s growth. For FY2024, ARR increased to 171%, TCV to 194%, and NRR to 174%. Observe’s headcount increased over 50%, and the company is scaling its sales organization as many tech companies pull back.
Cloud-native computing and complex microservice-based architectures have exponentially increased the volume of telemetry data businesses generate and the cost of legacy monitoring and APM tools. So Observe set out to address these challenges utilizing a modern architecture, featuring a data lake to ingest any event data and a robust data graph to provide relevant context. This helps organizations such as Capital One, Reveal, and Top Golf troubleshoot distributed applications faster at a fraction of the cost.
This new funding round builds on Observe’s momentum, including the release of Project Hubble — scaling to over one petabyte daily and delivering the latest GenAI innovations such as O11y GPT and OPAL Co-Pilot — along with the recent launch of Trace Explorer, a new advanced environment for analyzing distributed tracing data. Plus, Observe plans to expand its market presence in North America over the coming year and expects to continue to more than double the size of its business.
KEY QUOTES:
“Legacy monitoring and APM players, shackled by outdated architectures, are dead companies walking. As private equity or strategic acquirers strip them down for parts, Observe is taking a new approach designed for today’s modern distributed applications and massive data volumes. We’re thrilled to have investors who are thinking big and validating Observe’s approach in one of the fastest-growing segments in tech.”
- Jeremy Burton, CEO at Observe
“We believe Observe is the future of Observability and we’re incredibly excited to lead the Series B round. Observe has built a world-class team and delivered a product that is architecturally different to everyone else. The incredible growth in ARR and NRR is testament to the fact that this new architecture is now paying off for their customers.”
- Mike Speiser, Managing Director at Sutter Hill Ventures
“At Snowflake we believe there’s no such thing as an AI strategy without a data strategy. Observe recognized this from the outset and built a data company. Our team has worked closely with Observe as a partner since the company’s founding and with this investment, we’re bolstering that relationship and emphasizing our belief in Observe as the company enters its next stage of rapid growth.”
- Stefan Williams, VP Corporate Development & Snowflake Ventures
“Capital One is focused on building seamless customer experiences that make banking and commerce simpler and easier — wherever those customers are, digital or in-person. Like many cloud-first organizations, our data volume continues to expand. Observe provides a centralized and pre-correlated data layer that meaningfully organizes telemetry data from many sources at scale, helping drive faster response times.”
- Mark Cauwels, Managing Vice President, Enterprise Platforms Technology, Capital One
