Incredibuild, an Israeli startup that has picked up a lot of traction in the worlds of gaming and software development for a platform that drastically speeds up (and reduces the cost of) the shipment of code and related collateral during building and testing — has raised some capital to speed up its own development. The company has picked up $35 million in a Series B round of funding — money that it will be using for product development, as well as to strengthen its ecosystem with more investment into community, developer relations and cloud programs across more markets.

This all-equity round is being led by Hiro Capital, with past backer Insight Partners also participating. We understand from sources close to the startup that the money is coming with a doubling of its valuation: when Incredibuild last raised funds — $140 million in March 2021 led by Insight, which took a big stake in the company at the time — it was at a valuation of $300 to $400 million. The company has doubled its ARR in the last year, and although it doesn’t disclose the actual figure, this round likely puts its current valuation at close to $800 million.

If it sounds odd that a Series B would be so much smaller than the Series A, that’s in part because that previous round was a mix of debt and equity: the company had raised very little since being founded in 2000 and was profitable.

These more recent rounds have been to give the business — which counts companies like Epic, EA, Nintendo, Sony, Microsoft, Adobe and Citibank among its 1,000 customers — capital to build new products on top of those that were already doing well. (Hiro is a VC that focuses on gaming, creator platforms and metaverse technology; and so it can potentially help on that front.)

One example of how Incredibuild has been evolving its product is the company’s deeper move into the cloud. Incredibuild’s first iterations, and still one of the biggest use-cases, were aimed at helping organizations distribute compute across their own on-premise machines.

In a concept not unlike (but not exactly like) peer-to-peer networking, the idea is that there is idle CPU in organizations’ network at any given time, and so Incredibuild has built a way both to identify those idle gaps, and to effectively divide up heavy code and distribute it to run across those CPUs in real time, and to then be reintegrated at a final end point. Over time, that also incorporated cloud compute.

“It’s a flavor of grid computing,” Tami Mazel Shachar, the CEO, in an interview, “but the secret sauce is Incredibuild’s approach to parallelization and virtualization. Nothing needs to be installed on the remote computer.”

And most recently, in the last year, following what some of its customers are doing, it has made an even deeper move into cloud: it has now inked partnerships with AWS and Microsoft integrating the Incredibuild tech directly into gaming stacks run in those companies’ respective cloud platforms, the idea being that using many pieces of small compute in the cloud simultaneously works out to be cheaper and now faster than simply running a process over a platform’s biggest single compute platform. 

“If I have a heavy process, millions of lines of code, that would take a 64-core machine to process, it’s considered expensive and will run 10 hours,” said Shachar. “But if I take 400 4-core machines and run that for five minutes it is cheaper, shorter and running in less time.”

She added that it has yet to provide tools to companies to run compute over different cloud providers, and has yet to build a similar deep integration with Google’s cloud platform: the demand from customers for either of those use cases is not there (not yet, at least).

And although cloud is growing in use, the real story still seems to be a lot of motivation to get the most out of on-premise equipment.

“Most of our users are on-prem and then burst to cloud when they have a peak or need,” she said.

The bigger picture for why Incredibuild has been growing well is because its product addresses three key factors in the market today, Shachar said.

The first is that, if you believe that “the metaverse” is more than just a marketing concept, it will require significantly more compute power, and as many organizations are coming to realize, the solution to that will not rely on hardware alone, but also software that can intelligently optimize the usage of existing hardware.

That is related to the second factor, which is that it’s going to be hard to continue relying on hardware because of the chip shortage.

The third factor is that the growing drive for more media-heavy code and more digitized services overall is seeing a massive strain in terms of human capital: there are not enough software developers out there. That is driving a market for more software automation, to take out some of the busy work.

Interestingly, the other big theme in distributed computing has been the big push around decentralization in finance, specifically in areas like cryptocurrency. This is not something that Incredibuild has really touched yet, but I asked if its cheaper and more efficient approach to distribution could ever be applied there, given what a bad rap crypto mining has had for the energy and other resources that it consumes.

“The idea of crypto has been looked at,” Shachar said. “It’s not in our near future, but definitely an option. It’s a question of focus.”

The fact that its focus so far has gotten Incredibuild to a pretty good place as a startup and cash-generating business is an indication that it could well be on the right track.

“Games companies are feeling the squeeze in developer capacity. Incredibuild gives developers back precious time by accelerating build compilation,” said Cherry Freeman, co-funding partner at Hiro Capital, in a statement. “Amazing games companies like Tencent, Take Two, EA, Konami, Nintendo, Capcom, and WB Games are already reaping the benefits of Incredibuild and our hope is that more companies will discover and take advantage of their brilliant technology. As always, Games are the cutting edge for technological advancement, and we envisage a future where Incredibuild will be the de facto distributed supercomputer on every machine in every company.”