Y Combinator2 min read
Blacksmith hits $1B valuation speeding up AI-era code testing
A YC-backed startup built a faster CI cloud using gaming CPUs, growing 20x in a year as AI coding tools create a testing bottleneck.
AI summary of “The $1B Company Fixing AI’s Software Bottleneck”
Key takeaways
- Blacksmith raised a $66 million Series C led by Sequoia at a $1 billion valuation.
- The company grew 20x in the last year as AI coding tools increase demand for faster code testing.
- Blacksmith initially rented gaming-focused servers from a German firm known for hosting Minecraft and Call of Duty.
- Customer LangChain cut CI wait times from 15-20 minutes on GCP to 10-15 seconds on Blacksmith.
- The team runs with just 30 people, 12 of them engineers, despite massive infrastructure scale.
From outsiders to a $1 billion CI cloud
Blacksmith builds infrastructure to speed up continuous integration (CI), the process developers use to test code before shipping it. The founders, who met as undergrads in Toronto, were engineers but had no background in DevOps or platform engineering. One founder said being "naive enough in the right way" helped them avoid killing the idea before it met the market. The company has grown 20x in the last year and recently closed a $66 million Series C led by Sequoia at a $1 billion valuation.
Their key insight was that CI workloads resemble desktop and video game workloads more than typical cloud computing tasks, since both prioritize single-thread execution speed over parallelism. They began by renting servers from a German data center company known for hosting Minecraft and Call of Duty servers, and have since scaled to buying megawatts of power directly from data center providers. An early investor, who backed both the YC round and the Series A, said:
"It was even kind of a shock to me that somebody would even put a bunch of these things in one place."
Winning customers and scaling for the AI coding era
Blacksmith's first 200 customers came through founder outreach to friends and cold calls to CTOs and engineering leaders, without a sales team. Customers like LangChain saw CI wait times drop from 15-20 minutes on GCP to 10-15 seconds on Blacksmith. The company now runs a large fleet with just 30 people, 12 of them engineers, by keeping the product's scope narrow and investing in bespoke infrastructure tooling.
A founder said each new large language model release causes a spike in CI usage as developers rush to test and ship code against it, straining capacity. A power surge in Phoenix once knocked out cooling at a major data center, pushing Blacksmith toward geographic distribution. The team is now building autonomous QA tools that gather screenshots and video artifacts to help developers trust their code changes faster:
"We want to remove that bottleneck and allow developers to basically bring shipping software as close as they can to their speed of thought."
Written by AI from the video's transcript. It can compress, misattribute or miss context — the original video is the source. Not investment advice.
