Beacon Software Raises $250 Million to Fuel AI-Driven Software Company Roll-Ups

Beacon Software has raised $250 million in a Series B funding round to accelerate its ambitious strategy of acquiring and transforming smaller software businesses using artificial intelligence. The round was led by prominent investors including General Catalyst, Lightspeed Venture Partners, and D1 Capital, valuing the company at $1 billion. Since its launch last year, Beacon has raised a total of $335 million, underscoring strong investor confidence in AI-driven automation’s potential to reshape traditional software markets.

Founded by former Instacart President Nilam Ganenthiran and ex-Sequoia Capital Partner Divya Gupta, Beacon focuses on acquiring profitable, niche software companies that serve “Main Street” customers in often overlooked sectors such as youth sports leagues, campgrounds, manufacturers, and labor unions. These businesses typically generate less than $20 million in annual recurring revenue yet consistently maintain profitability.

Beacon’s model involves buying a new software company approximately every two weeks and equipping it with a modern, AI-powered software technology stack. Unlike traditional private equity firms that often emphasize cost-cutting and quick exits, Beacon brands itself as an “anti-private equity firm.” It prioritizes permanent ownership, reinvestment, and sustainable growth to modernize traditional industries over the long term.

The company’s AI-driven approach aims to optimize operations, improve product offerings, and unlock new revenue streams for acquired companies. By integrating AI technologies, Beacon helps these businesses scale efficiently and compete more effectively in digital-first marketplaces.

Beacon’s latest funding will fuel further acquisitions and technology investments, positioning it as a key player leveraging AI in the software roll-up space. With growing demand for niche software solutions and increasing interest in AI automation, Beacon’s strategy reflects a new wave of innovation blending investment with advanced technology to drive lasting business transformation.