Key Takeaways
- • Traversal, a New York startup whose AI agents diagnose why company software breaks, raised $120M in a Series B round at a $1B valuation, according to the company's announcement on Tuesday.
- • Kleiner Perkins, Redpoint Ventures and Khosla Ventures co-led the round; Sequoia Capital, Battery Ventures and Amex Ventures also participated, with Kleiner Perkins and Sequoia increasing their stakes.
- • Total capital raised by Traversal now stands at $173M, per the company.
- • Traversal says its annual recurring revenue has grown ninefold since the start of the year, and monthly investigations rose from 513 to nearly 73,000 this year.
- • On its ORCA-bench benchmark, built with Cornell Tech and Columbia University, the best of five frontier AI agents correctly identified the root cause of 25.3% of medium-difficulty incidents, with accuracy falling to 10% when incident reports were vague.
Summary
Traversal, a New York startup whose AI agents identify the causes of software failures, has raised $120 million in a Series B round that values the company at $1 billion, the company announced on Tuesday. Kleiner Perkins, Redpoint Ventures and Khosla Ventures co-led the round. Sequoia Capital, Battery Ventures and Amex Ventures also participated, and Kleiner Perkins and Sequoia both increased their stakes. Traversal has raised $173 million in total.
The company's thesis is that AI is generating code faster than engineers can keep it running. Co-founder and chief executive Anish Agarwal told Forbes that AI-written software "break[s] in fundamentally new ways" and is harder to repair. Traversal's agents perform the investigative work of site reliability engineering: they analyze logs, metrics and code, test possible causes and recommend fixes. The company's Production World Model converts telemetry, code and deployment history into a map that an AI can read, and its Causal Search Engine tests thousands of possible causes simultaneously. Traversal Workers begin investigations when an alert fires, and the Traversal MCP shares what the system learns about production with AI coding agents.
Traversal reports strong commercial traction. Nubank, Harvey, DigitalOcean, PepsiCo and American Express are customers, and Forbes reported that Blackstone is also a customer. The company says its annual recurring revenue has grown ninefold since the start of the year, and customers ran more than 150,000 investigations last quarter. Agarwal declined to disclose revenue figures to Forbes. According to the company, about two-thirds of usage now extends beyond outage root-cause analysis to alert triage, release risk and security.
Traversal also published ORCA-bench, a benchmark developed with Cornell Tech and Columbia University that tests general AI agents on 1,079 root-cause tasks. The best of five frontier agents correctly identified the cause of 25.3% of medium-difficulty incidents, accuracy fell to 10% when incident reports were vague, and hallucination rates reached 40%, according to Traversal. Agarwal cited downtime costs of as much as $600 billion a year.
The founders include Agarwal and Raj Agrawal, who earned PhDs at MIT, and Raaz Dwivedi, who earned his PhD at UC Berkeley; Ahmed Lone came from quant trading at Citadel Securities. Agarwal and Dwivedi retain faculty posts at Columbia University and Cornell Tech. Traversal emerged from stealth in June 2025 with $48 million from Sequoia and Kleiner Perkins, and Amex Ventures invested in December 2025. The company plans to hire across research, engineering and go-to-market teams. Kleiner Perkins partner Mamoon Hamid told Forbes that AI has "created acuteness around the problem of cyber reliability."
The company's thesis is that AI is generating code faster than engineers can keep it running. Co-founder and chief executive Anish Agarwal told Forbes that AI-written software "break[s] in fundamentally new ways" and is harder to repair. Traversal's agents perform the investigative work of site reliability engineering: they analyze logs, metrics and code, test possible causes and recommend fixes. The company's Production World Model converts telemetry, code and deployment history into a map that an AI can read, and its Causal Search Engine tests thousands of possible causes simultaneously. Traversal Workers begin investigations when an alert fires, and the Traversal MCP shares what the system learns about production with AI coding agents.
Traversal reports strong commercial traction. Nubank, Harvey, DigitalOcean, PepsiCo and American Express are customers, and Forbes reported that Blackstone is also a customer. The company says its annual recurring revenue has grown ninefold since the start of the year, and customers ran more than 150,000 investigations last quarter. Agarwal declined to disclose revenue figures to Forbes. According to the company, about two-thirds of usage now extends beyond outage root-cause analysis to alert triage, release risk and security.
Traversal also published ORCA-bench, a benchmark developed with Cornell Tech and Columbia University that tests general AI agents on 1,079 root-cause tasks. The best of five frontier agents correctly identified the cause of 25.3% of medium-difficulty incidents, accuracy fell to 10% when incident reports were vague, and hallucination rates reached 40%, according to Traversal. Agarwal cited downtime costs of as much as $600 billion a year.
The founders include Agarwal and Raj Agrawal, who earned PhDs at MIT, and Raaz Dwivedi, who earned his PhD at UC Berkeley; Ahmed Lone came from quant trading at Citadel Securities. Agarwal and Dwivedi retain faculty posts at Columbia University and Cornell Tech. Traversal emerged from stealth in June 2025 with $48 million from Sequoia and Kleiner Perkins, and Amex Ventures invested in December 2025. The company plans to hire across research, engineering and go-to-market teams. Kleiner Perkins partner Mamoon Hamid told Forbes that AI has "created acuteness around the problem of cyber reliability."
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