UPDATED 06:00 EDT / JANUARY 23 2017

APPS

Tricentis hauls in huge $165M funding round to automate software testing

The software testing market isn’t generally thought of as a hotbed of venture capital investment, but Tricentis GmbH is aiming to put that image to rest with today’s announcement of a massive $165 million series B financing round led by Insight Venture Partners.

The announcement is all the more remarkable given that the Vienna, Austria-based firm’s previous funding round was only $9 million and that the company claims to already be operating on a break-even basis, with more than 400 paying customers on its books.

Tricentis is betting that the large-scale shift to agile programming and DevOps methodologies will turbocharge the market for automated testing tools. Despite the automation of nearly everything else in today’s information technology environments, software testing remains a largely manual process, with test scripts painstakingly developed to the specifications of individual projects.

That worked well enough when release schedules were measured in months, but DevOps compresses that those timeframes to days. “Traditional techniques can’t keep up with the level of assessment that’s required to understand the risk of a software release candidate,” said Wayne Ariola, chief marketing officer at Tricentis.

‘Testing manually seems asinine’

The company calls its scriptless approach “model-based automation,” and says its technology can create up to 90 percent of the tests needed for a typical software project without human intervention. Traditionally, scripts have been used to put an application under construction through its paces, such as clicking certain items on a drop-down menu or entering values in fields. Hiring developers to write scripts is costly, said Chief Executive Sandeep Johri. “Scripts are also fragile, so anything that changes can break them,” he said. The constant change of a DevOps environment is fundamentally incompatible with traditional manual processes, Johri said. “Testing manually seems asinine.”

Tricentis’ approach is to interpret the application and build a functional model of it, including the graphical user interface and application program interfaces. Instead of executing rote commands to, for example, click on the third item in a drop-down menu, the software builds a logical view and automatically adapts to changes in the code. “In effect we are re-reading the application and the API” whenever the code changes, Johri said.

DevOps has gotten off to slow start because of the process and culture changes it involves. Long planning and development timelines are replaced by frequent releases and continuous feedback, with developers taking greater control over the environment in which their application will run.

DevOps at a tipping point

There is evidence, however, that DevOps is reaching a tipping point. Puppet Inc.’s fifth annual State of DevOps Report, which was released in June, found that 22 percent of respondents say they are part of a DevOps team, up from 16 percent in 2014. Research and Markets expects adoption to proceed at a 20 percent compound annual growth rate through the end of the decade.

Thus the big funding round. “The amount was mostly driven by the fact that our investor believes this is a huge opportunity,” Johri said. The company expects to invest in building its U.S. sales force – which currently numbers just five people – and building its marketing presence as it expands globally. Tricentis currently has offices in Australia, Germany, India, Netherlands, Switzerland, Poland, the U.S. and the United Kingdom. It also expects to up its spending on research and development and make acquisitions.

Tricentis may be helped by favorable headwinds from its competitors. In its most recent Magic Quadrant for Software Test Automation, research firm Gartner Inc. put Tricentis in the “leader” category along with Hewlett Packard Enterprise Co. and IBM Corp. However, HPE has announced plans to sell much of its software business to Micro Focus International plc, and IBM’s current strategic push is in other areas.

Image by Byron Villegas via Flickr CC

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