Factory jumps to $5B in 5 months with $200M for its AI ‘Droids’

Factory just turned a $200 million funding round into a $5 billion valuation, a leap that would look silly if it weren’t so neatly timed with the AI coding rush. The company says the new money comes from Khosla Ventures, Blackstone and Sequoia Capital, with three angel backers including Salesforce chief executive Marc Benioff, Altimeter founder Brad Gerstner and Nico Rosberg.

That valuation matters because it keeps climbing fast. Five months ago, Factory was valued at $1.5 billion. In July, a $120 million extension pushed it to $4 billion. Before that, a $150 million Series C in April set the earlier mark. Three jumps, one after another, and now the total funding has moved past $400 million.

Factory was founded in 2023 by Matan Grinberg and Eno Reyes. Its product, Droids, is not the usual coding assistant that tosses out a line or two in an editor. The agents are meant to write, test, review, document and deploy code, with the goal of handling engineering work end to end for enterprise teams.

The company is already selling into some very large names: Nvidia, Adobe, Morgan Stanley, Royal Bank of Canada, Palo Alto Networks and Ernst & Young. Its pitch also leans on flexibility. Droids can switch between models from providers such as Anthropic’s Claude and DeepSeek, which Factory frames as a way to avoid being trapped by one AI lab. That is a practical sell in a market where the prices are racing upward almost as fast as the hype.