Code Metal, a startup based in Boston, has successfully raised $125 million in a Series B funding round to enhance the defense industry’s coding capabilities using AI. This funding follows their prior Series A round, which secured $36 million just months earlier and was led by Accel.
Founded in 2023, Code Metal aims to modernize software for defense contractors by translating and verifying legacy code. The company works with notable clients like L3Harris, RTX (formerly Raytheon), and the US Air Force. Additionally, they are collaborating with Toshiba and have discussions in progress with a major chip manufacturer regarding code portability.
The key function of Code Metal’s platform is to convert high-level programming languages, such as Python and C++, into lower-level languages that are more suited for specific hardware. Code Metal’s CEO, Peter Morales, emphasizes that the company addresses significant challenges in migrating old code to modern applications, which is critical for government and defense operations where quick turnaround is essential. Morales mentioned a notable observation by AI researcher Andrej Karpathy concerning the need for extensive rewriting of existing software, a task that Code Metal seeks to streamline.
While many startups in the AI realm focus on automating code generation and ensuring its quality, Code Metal stands out by providing a technology that not only translates but verifies code through a series of testing frameworks embedded in their process. This ensures customers are aware of the translation’s integrity at every step.
Despite being conservative about sharing technological specifics, Code Metal has developed a flexible pricing strategy that moves away from traditional "per seat" models. Instead, pricing is tailored based on the time saved, lines of code translated, or the efficiency gained through using their software.
With the recent funding, which included contributions from Salesforce Ventures and other investors, Code Metal’s valuation has reached $1.25 billion. Moreover, the company claims to be profitable, marking it as both a unicorn and a pioneer in its approach to modernizing the defense tech landscape. As the industry evolves and increasingly integrates AI into its operations, the long-term effectiveness of such startups remains to be seen.
