Moderne, a startup founded in 2020, has raised $30 million in Series B funding to tackle the growing problem of technical debt in software development. The company's platform uses AI-powered code refactoring to help businesses modernize their software stacks, reducing the complexity and costs associated with technical debt.

Technical debt refers to the consequences of taking shortcuts in software development, prioritizing speed over quality and long-term scalability. As codebases grow, they become increasingly complex, costly to maintain, and difficult to add new features. Moderne's solution analyzes a company's entire software stack, handles framework and library migrations, fixes security vulnerabilities, and upgrades older technology to modern cloud-native equivalents.

The company's founders, Jonathan Schneider and Olga Kundzich, bring extensive experience in senior engineering and product management roles at Pivotal, which VMware acquired for $2.7 billion in 2019. Schneider was also a senior software engineer at Netflix, where he helped create Rewrite, an internal project focused on automating the refactoring of Java code. This project eventually became OpenRewrite, an automated code refactoring ecosystem that has been adopted by big-name companies like Microsoft and Amazon.

Moderne's platform builds upon OpenRewrite, adding features to make it more scalable across enterprise settings. The startup offers support for multiple repositories and complex workflows, collaboration via a web-based user interface, and reporting and analytics. With this new funding, Moderne plans to expand its capabilities, particularly in application security (AppSec), and has recently hired its first chief information security officer.

The $30 million Series B round was led by Acrew Capital, with participation from Allstate, Amex Ventures, Intel Capital, Mango Capital, Morgan Stanley, TIAA Ventures, and True Ventures. Moderne has now raised a total of $50 million in funding since its inception. The company's employee base of 50 "seasoned experts" will also be expanded to cater to specific domains like AppSec.

Schneider notes that Moderne's goal is to address the "multi-billion-dollar problem" of technical debt across the industry. The company's solution is designed to replace manual work carried out by consultancy firms, which can be time-consuming and costly. Moderne's AI-assisted auto-refactoring capabilities, powered by OpenRewrite's Lossless Semantic Tree (LST) code representation, enable the company to transform code at scale across multiple repositories with high accuracy and efficiency.

The company's customer base includes large enterprises like Walmart and Allstate, as well as smaller businesses with as few as six developers. Moderne's investor base also includes strategic investors from the enterprise world, such as American Express and Morgan Stanley. Schneider emphasizes that technical debt is a perpetual problem, as companies continually evolve their tech stacks to keep pace with changing best practices and new components.

"Codebases are in a constant state of evolution, requiring updates, security fixes, consolidation, improvements — modernization never ends," Schneider said. "Ironically, the most modern tech stacks are the ones most susceptible to breakage from the rapid iteration of third-party and open-source dependencies on which they rely."

Moderne's solution is designed to help companies achieve "tech stack liquidity," enabling them to make changes across their entire codebase with ease. As the company continues to grow and expand its capabilities, it is well-positioned to address the growing problem of technical debt and help businesses modernize their software stacks for the long term.