Software Asset Management Startup Xensam Raises $40 Million
Software Asset Management A Crucial Enterprise IT Field for Cost Savings, Still Attracting Major Investments
Xensam, a software asset management company, has secured $40M in funding for their AI technology after 8 years of bootstrapping.
Software asset management (SAM) is a crucial aspect of enterprise IT, helping companies keep track of their software usage and save money. In a recent development, Xensam, a Stockholm-based startup that provides AI-based tools for software tracking, has secured $40 million in its first-ever external funding. The investment comes from Expedition Growth Capital in London and will be used to further develop Xensam’s AI technology stack, expand its team, and enter the U.S. market.
📈 Growing Success
Xensam, founded eight years ago, boasts 200 customers, including renowned companies like Volvo’s Polestar and Northvolt. While the exact valuation remains undisclosed, CEO Oskar Fösker confirmed that he and his brother, Gustav Fösker, the CTO, remain majority shareholders. The company’s annual recurring revenue is growing at an impressive rate of 126%, although specific revenue figures are not public.
🌐 A Crowded Space
Software access management, also referred to as software expense management or license management, is a highly competitive arena. This is hardly surprising considering the scale of the challenge it addresses. Organizations worldwide spent nearly $900 billion on enterprise software in 2023, with larger enterprises often managing hundreds or thousands of different software licenses. This complexity can impact business spend, productivity, and security.
😅 The Birth of Xensam
Xensam emerged from this competitive landscape when its founders, Oskar and Gustav Fösker, recognized a gap in the market. Both had previously worked at Snow Software, a major player in software asset management. However, they felt that Snow was falling behind in cutting-edge developments such as utilizing AI to track software-as-a-service (SaaS) usage. Realizing the opportunity, they set out to create the first native SaaS player in the SAM industry.
🤖 AI-Powered Software Tracking
Xensam’s approach centers on leveraging AI to comprehensively scan and understand an organization’s network. With real-time insights, Xensam offers a holistic view of thousands of applications across cloud and on-premise environments. The company applies AI in various components of its technology, such as the software normalization process that transforms raw data into standardized applications enriched with metadata. Xensam also employs an AI-powered chatbot that interacts directly with the system, providing information and generating reports based on open specifications.
📈 Future Developments and Cultural Values
While details about Xensam’s upcoming products and market strategy are yet to be revealed, the company plans to launch additional offerings in the second quarter. As a bootstrapped startup, Xensam emphasizes its sustainable business model and financial stability. CEO Oskar Fösker believes that relying solely on funding rounds (Series A, B, C, etc.) can negatively impact company culture and focus. Therefore, Xensam decided to seek external funding once they had established a solid business model.
😎 The Right Partnership
Xensam found the perfect investment partner in Expedition Growth Capital, a firm experienced in working with bootstrapped startups. The compatibility of cultural values played a crucial role in the decision-making process. Expedition’s founder and managing partner, Oliver Thomas, praised Xensam as one of the most impressive European growth companies. The investment signifies Expedition’s confidence in Xensam’s critical solution for tracking, monitoring, and managing software usage.
🔗 Related Links – Xensam – Snow Software – Flexera – Apptio – AI in software asset management
🤔 Q&A: What More Do You Want to Know?
Q: How does software asset management impact business spend? Software asset management helps businesses optimize their software usage, ensuring they have the right licenses for their needs. By tracking software usage and avoiding unnecessary licenses, organizations can reduce costs and avoid overspending on unused software.
Q: Is software asset management only for large enterprises? No, software asset management is essential for businesses of all sizes, although the complexity and scale may vary. Small businesses can also benefit from SAM practices to control costs, ensure compliance, and enhance productivity.
Q: What are the main challenges of implementing software asset management? Implementing software asset management can be challenging due to the complexity of software licensing models, the sheer number of licenses in a large organization, and the constant changes and updates to software. Effective SAM requires dedicated resources, accurate data, and robust tools to track and manage licenses effectively.
Q: How is artificial intelligence used in software asset management? Artificial intelligence is increasingly employed in software asset management to automate various tasks, such as software discovery, license reconciliation, and usage tracking. AI can analyze large volumes of data and provide real-time insights, enabling organizations to make informed decisions and optimize their software assets.
Q: What is the future of software asset management? The future of software asset management is likely to involve even more advanced technology, including AI and machine learning. Automation will continue to play a significant role in optimizing software usage and ensuring compliance. Additionally, the expansion of cloud computing and the growing demand for software-as-a-service will influence how software assets are managed and monitored.
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