Resolve AI, a company creating an autonomous site reliability engineer tool designed to automatically maintain software systems, has secured a Series A funding round led by Lightspeed Venture Partners, according to three individuals with knowledge of the transaction. The reported valuation for this new round stands at $1 billion, sources indicated.

However, the company's actual blended valuation was lower due to a multi-tranched investment structure. Under this arrangement, investors bought a portion of equity at the $1 billion valuation but purchased the remainder—likely representing a larger share of the round—at a reduced price. This innovative funding strategy has recently gained popularity among the most in-demand AI startups, according to investors.

The startup's annual recurring revenue is approximately $4 million, two of the sources noted. The exact size of the funding round could not be determined. Resolve AI and Lightspeed did not respond to requests for comment.

Founded less than two years ago, the company is headed by former Splunk executive Spiros Xanthos and Mayank Agarwal, who previously served as Splunk's chief architect for observability. The pair's professional partnership spans two decades, originating from their graduate studies together at the University of Illinois Urbana-Champaign.

This collaboration represents their second joint venture; they previously co-founded Omnition, a startup that Splunk acquired in 2019.

While human site reliability engineers typically handle manual troubleshooting and system failure resolution, Resolve AI automates this entire process by independently identifying, diagnosing, and fixing production issues in real time. This automation tackles a significant and growing challenge for modern businesses.

As software systems grow increasingly complex and distributed across cloud infrastructure, organizations frequently face difficulties in recruiting and retaining enough skilled SREs to ensure systems operate smoothly. Automating these critical tasks can minimize downtime, reduce operational expenses, and allow engineering teams to concentrate on developing new features rather than constantly addressing production problems.

Last October, Resolve AI closed a $35 million seed funding round led by Greylock, with participation from World Labs founder Fei-Fei Li and Google DeepMind scientist Jeff Dean.

In the competitive landscape, Resolve AI faces Traversal, another AI SRE startup that recently raised a $48 million Series A round led by Kleiner Perkins, with Sequoia also participating.