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April 6, 2023

Honeycomb Taps Observability Buzz to Raise $50M Series D

Honeycomb, a cloud application observability platform, announced it has raised $50 million in Series D funding for a total of nearly $150 million.

“The future of observability has never been more exciting, and this latest round ensures we can continue to invest—with conviction—in improving the lives of software engineering teams. We hope this is a moment of welcome change from the soul-crushing headlines plaguing the tech industry these past few months,” Honeycomb CEO Christine Yen said in a blog post.

Honeycomb asserts that legacy APM tools were not built for the complex distributed cloud environments of today. Honeycomb has built its datastore to be datatype agnostic, and the company says this difference makes it the only observability company to entirely sidestep the data correlation problem across logs, metrics, and traces.

“High-performance engineering teams need accessible, intuitive observability workflows. While our competition is busy rearchitecting their data stores, we’re once again leading the pack by delivering innovative, developer-centric features that scale the power of knowledge across teams,” said Yen in a statement. “Too often, a prospect using a traditional APM tool comes through our door after being slapped with surprise overage bills or frustrations regarding incident visibility. Organizations should never be subjected to gaps in visibility just to save on cost—Honeycomb makes good on that promise.”

With the growing complexity of software environments and applications, unforeseen bugs and anomalies can arise, making it crucial for teams to analyze high-cardinality data to discover these novel problems. Honeycomb says its platform gives engineering teams the power to detect patterns in seconds across billions of data points representing how users are experiencing their code in real time, while never aggregating or discarding data.

CEO Yen and CTO Charity Majors, former Facebook engineers, founded Honeycomb in 2016 after being dissatisfied with available APM tech. “Christine and I started Honeycomb after trying every monitoring and logging solution under the sun and realizing that they were fine for answering simple known-unknowns, but wretchedly horrible for answering unknown-unknowns. Observability changed our lives (and sleep schedules) dramatically, transformed how we used systems, made us better engineers, and made us want to give that to our entire industry,” wrote majors in a 2021 blog post.

(Source: Honeycomb)

Honeycomb has found success in a crowded observability space with competition from established firms like Splunk and Elastic. The company saw a second consecutive year of 2x revenue growth, as well as a 160% net revenue retention for 600+ customers. Honeycomb was also named a leader in the Gartner Magic Quadrant for APM and Observability. The company counts investing app Robinhood, digital infrastructure firm Equinix, and the communications platform Slack among its customers.

The latest Series D round was led by Headline, a Honeycomb backer since 2018, with participation from Insight Partners and Scale Venture Partners. Customer angel investments include those from HelloFresh CEO Dominik Richter and Vercel CEO Guillermo Rauch. Kelly Watkins, former VP of Global Marketing at Slack and CEO of Abstract, has joined the Board of Directors.

Honeycomb says this funding will propel its global expansion, as well as its support for the OpenTelemetry framework. The company will also be focusing on building a cohesive integration strategy across the entire software development ecosystem.

“Software is the genetic makeup of our modern global society. We rely on it for everything—so if your apps and services aren’t performing how they were intended to, users will leave them to find ones that work,” explains Tom Gieselmann, founding partner at Headline. “This makes the mission and value that Honeycomb’s observability platform provides to engineering teams business-critical, and we couldn’t be more thrilled to help them scale to win big on a global level.”

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