AI Agents for IT Service Management: Our Investment in Serval

“One of ServiceNow’s largest moats is how customizable their product is. Today, humans do all the configuration and setup for workflows in ServiceNow. A next-generation IT service management platform should use LLMs to generate code for custom applications on the fly.”

That line comes from a memo we wrote in June 2024 about the opportunity to disrupt ServiceNow. We had strong conviction that code generation would be the wave that finally enabled a startup to challenge such a deeply entrenched incumbent.

For more than three years, we met nearly every company in ITSM and even explored incubating one ourselves but never found the right combination of team and product. That changed when we met Jake Stauch and Alex McLeod, the founders of Serval.

The Team: Deep Domain Expertise Meets Relentless Execution

Jake and Alex saw the ITSM pain point firsthand at Verkada and developed a clear vision for how AI agents should work. In our first meeting, Jake showed us how automating a task permanently in Serval should take less time than doing that task once manually.

Their ambition quickly attracted incredible talent. Several former colleagues joined from Verkada on the engineering side, and Tatiana Birgisson came on as COO after scaling marketing at Rippling. Since then, even more Rippling alumni have joined to build out a world-class GTM team. That kind of talent gravity is one of the strongest signals we see in great early-stage companies.

System of Record + System of Intelligence

Serval’s core insight is simple but powerful: to build great AI agents, you must own the workflow and the data.

They built their own ticketing system (System of Record) and layered AI agents directly on top (System of Intelligence). Serval gives customers the flexibility to adopt their AI agents on top of existing tools and transition to their ticketing system over time or adopt the whole platform from the beginning. By controlling the full stack, Serval isn’t limited by legacy data models like ServiceNow or Jira and can automate IT tasks with far more intelligence.

Whoever has the best data will have the best AI. Serval’s architecture gives them that advantage and customers including Perplexity, Clay, Owner, Mercor, Together, and Cribl are already seeing the impact.

Opportunity to Disrupt a Massive Incumbent

At Redpoint, we’ve been fortunate to partner with many startups going after large incumbents like Snowflake (DW), Attio (CRM), Everest (ERP) and many more. The most attractive markets often have the largest incumbents but get reinvented over time with new shifts in technology.

Code generation is that shift for ITSM.Serval was built to be code-native from day one. Every workflow is code generated by an LLM, not manually wired together by humans. This gives IT teams more flexibility and power without losing control. This foundation isn’t just a UX improvement, it’s a fundamental shift in how enterprise automation is built.

There is a tremendous amount of budget up for grabs as AI enters ITSM. ServiceNow alone does more than $12.5B in ARR and the ITSM market is expected to grow to over $32B by 2032. As AI reshapes IT, Serval is leading the charge.

Series A and Beyond

After looking at the ITSM market for over three years, we couldn’t be more excited to partner with Jake, Alex, Tatiana, and the Serval team as they reimagine IT for the AI era.

They’re tackling one of the largest, most entrenched categories in enterprise software with world-class execution and a truly AI-native foundation. If that sounds interesting to you, check out their careers here.

Congratulations to the Serval team and thanks for trusting us to be part of your journey.