Blacksmith's valuation jumps 10x in a year as AI coding creates a testing bottleneck

"Validating code is still a bottleneck, and it's an even bigger bottleneck because people are writing even more." That is Blacksmith co-founder and CEO Aditya Jayaprakash's frame for why a 30-person startup just raised a $45 million Series B at a $550 million valuation, nearly 10x its $60 million mark from less than a year ago.

Peak XV Partners led the round, with existing investors GV and Y Combinator also participating. Total funding now sits at $58.5 million.

Blacksmith was founded in 2024 as a continuous-integration cloud provider and has since expanded into Codesmith, an AI coding agent that auto-fixes failed code checks. The customer base grew from roughly 700 to more than 5,000 in under a year, including Mercury, Supabase, Clerk, Ashby, and Expensify.

Jayaprakash said Blacksmith hit a $10 million annualized revenue run rate with just 10 employees. Headcount has since grown to about 30 and revenue to "tens of millions of dollars," with some top customers now spending more than $1 million a year. Updated ARR was not disclosed in the round.

Jayaprakash argues AI coding tools have accelerated code generation, making validation the rate-limiting step. The lane is crowded: cloud-build offerings from AWS, Azure, and Google Cloud all sit alongside Blacksmith.