Raleigh-based enterprise automation startup Cycle Labs announced today a $2.5 million investment from Durham’s Jurassic Capital. This comes days after Jurassic said it finalized its inaugural fund with investor commitments of more than $20 million. [Editor’s Note: We first profiled Cycle Labs last June, and wrote about Jurassic’s fund on Tuesday.]
Cycle Labs, which was named a GrepBeat Startup to Watch last year, is headed by CEO Josh Owen. Owen co-founded Tryon Solutions in 2009 with Adam Downing to help companies increase productivity, manage risk and optimize operations across the supply chain. He then helped build Tryon Solutions’ Cycle, an enterprise automation software to supplement Tryon’s professional services.
The continuous testing platform gained so much interest as a licensed product that Owen proposed it as its own company. Cycle Labs spun out from Tryon Solutions and launched as a standalone startup in July of 2021 with 25 employees. Soon, it was time to find some fresh financing to fuel growth.
“I’ve always thought that we really shouldn’t go get cash until it was the one thing that was preventing us from scaling,” Owen said. “We’ve got an established product. We’ve got established processes. We’ve got incredible talent. And now we just need to put some more fuel in the engine to really allow us to speed up and scale at a much faster velocity.”
Now at 30 team members, with Jurassic’s funding in hand Cycle Labs is looking to hire another 20 this year.
Jurassic partner Kevin Mosley said the investment was natural after getting to know the Cycle Labs team over the last two years and watching them grow. Owen originally reached out to Mosley on LinkedIn for advice, and over time, trust built. Once Cycle Labs officially spun out in 2021, it was the catalyst to the $2.5 million investment.
Specifically, Jurassic was impressed by the concept for Cycle’s continuous test automation platform, how it could boost business confidence and the growth the startup sustained over the past couple of years. Although it’s still early, Cycle Labs is already a market leader, Mosley said.
“They come from this world of logistics implementation, which they just understand,” Mosley said. “They’ve been in their customers’ shoes. They totally get it.”
Meanwhile, with the operational expertise that Mosley and Bronto Software co-founders Joe Colopy and Chaz Felix—who are also part of the Jurassic team—can provide, the pieces all fell together. There were other investment firms interested in placing a bet on Cycle Labs, but Owen and his team went with Jurassic.
“It was an obvious cultural fit,” said Mosley. “It was an obvious fit from where we can add value. Where Jurassic shines is when we have a chance to add more value than just capital, where we get to offer a bit more and can offer some expertise from our background.”
The idea for Cycle Labs stems from the problem that, while many companies want to make changes to their operations in response to new challenges and opportunities, they are often unsure how those changes could impact the rest of their software system.
“Most organizations know which changes they want to make, but they don’t make them,” Owen said. “And they don’t make them because there’s a fear of change, because you don’t have the ability to sort of objectively measure the risk inherent in making these changes.”
There’s an inordinate number of open-source, free and commercial test automation solutions on the market today, Owen said, but none of them focus on testing packaged software. The downstream effects on other applications for businesses are largely unknown. That is where Cycle Labs comes into play.
“Ultimately, what we say is, we give our clients the ability to have freedom to choose to make the changes they seek to make when they seek to make them, and to have the confidence to feel good about it,” Owen said. “It’s a freedom to focus on business growth rather than business risk.”
If anything has proven true amid the ongoing pandemic, it’s that organizations can no longer be afraid to change. This translates to increased interest in a company like Cycle Labs, which can help companies more efficiently switch their systems to other vendors and solutions.
“I think a lot of organizations, specifically in the supply chain space, have realized that stagnation or an inability to change is a real detriment to their business,” Owen said.
Owen added, “They need to be agile. They need to be able to make decisions quicker. So I think it’s really opened up the door for a lot of organizations who may be more interested in being able to make changes like that. They now want to have those conversations.”
With the $2.5 million in tow, Cycle Labs will grow out its commercial side of the business, investing in sales, marketing, customer success and other structural initiatives internally, Owen said. Up to now, Cycle Labs only operated with one salesperson and one marketing person.
Moving forward, the startup will convert to a cloud-native version and scale its marketing presence while running more deals at the same time.
“They’ve got all the potential in the world,” Mosley said. “I think that’s one of the things that just makes it so exciting for us is that we see this being a company that can get a lot larger and has potential for even more.”