Opkey, an AI-based ERP testing platform, raises $47M

Companies are experimenting with services like ChatGPT to help workers write memos, answer questions, and much more, yet one of the clearest signs of how much traction AI is really getting in the world of enterprise IT is how often it figures in the more routine applications that organizations use. Today, a startup that exemplifies that axiom is announcing funding, underscoring that pace of enterprise AI adoption.

Opkey has built an AI platform to help organizations continuously test finance, HR and other enterprise resource planning (ERP) software. Now, on the back of some strong customer traction — more than 200 large enterprise customers; partnerships with system integrators like KMPG and PwC — it’s closed a Series B of $47 million. 

PeakSpan Capital is leading the round, with participation from previous backers, with current investors including UST Global, Verica, Vertical and India’s YouNest. This Series B is a big step up for Dublin, CA-based Opkey: prior to it, the company had only raised $12 million. It’s not disclosing valuation. 

Opkey’s platform may not be at the most visible end of the enterprise IT stack, but it’s addressing a gap in the market that is critical to how enterprises operate.

Cloud architecture and SaaS are at the bedrock of how all new business services are built, but they have also found a lot of footing with more legacy organizations undergoing digital transformation processes. They can be faster and cheaper to use and easier to deploy to a user base, but they can also come with a ton of problems, including the fact that any vulnerabilities or inconsistencies between software can take down entire networks. This is where Opkey comes into the picture. 

Pankaj Goel, the CEO, co-founded the company with his childhood friends Avinash Tiwari and Lalit Jain. All three are ERP industry veterans with experience at big companies like Adobe and Oracle. Their time there gave them experience in software testing, and it also gave them a front-row seat to how disastrous it could be if not done correctly. ERP systems typically do not exist in siloes: they integrate with each other to work, which means if one conflicts with another, or is not working correctly, the whole ERP stack can crash. 

“Cloud applications are continuously giving updates, which was not the case with traditional software,” Goel said in an interview. “That functionality breaks existing functionality.” He estimates that typically an organisation might integrate seven or eight ERP systems together. “Any change in the ecosystem and you need to test it again. It means enterprises are in testing hell.”

Testing and data hell are in fact classic use cases for AI-based automation to resolve, something that cybersecurity and DevOps software companies have also come to realise. In the case of Opkey and ERP, it’s continuously tracking areas like integrations, updates, upgrades and something they describe as “user acceptance” — which involves how well end users are interacting with new features they are supposed to be using. Packages and platforms that Opkey currently covers include Oracle, Workday, Coupa, Veeva, Salesforce, SAP, Microsoft Dynamics, UKG and Trackwise.

Sanket Merchant, the partner at PeakSpan who led on the investment, believes that there will continue to be a very strong funnel of business interest for services like Opkey’s given the way IT is moving. (Will that be enough to stave off competition from others in the same space such as Leapwork and Katalon is one question, ditto whether bigger ERP players may look to take this business on themselves.)

“For businesses, the most expensive IT spend is related to critical enterprise apps, their ERP apps,” he said, citing figures that say that some $73 billion is spent on ERP software for billing, accounting, people management, software deployment and more annually across both smaller businesses but especially massive, multinational organizations. These in turn can have as many as 52 different other apps that rely on ERP integrations to work. “Automated testing is important to drive assurance around that investment, to make sure it behaves as intended. A failed SAP deployment or Workday migration can have a huge impact a business’s revenue, and its brand.”