Why Datadog’s Acquisition of Eppo Is a Bet on Product-Led Observability
PLUS: Highlights from last week’s top venture funding rounds across AI, climate tech, health, and aerospace.
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Venture Radar
Datadog Expands from Observability to Product Impact
It was announced that Datadog will be acquiring Eppo, a platform focused on feature flagging, A/B testing, and product experimentation. The deal signals a strategic evolution for Datadog - from a platform that helps engineering teams monitor infrastructure health, to one that enables full-cycle product delivery and validation. While Datadog has long excelled at showing teams what’s happening across their systems, it hasn’t addressed whether those changes drive positive outcomes for users or the business. That’s where Eppo fits in. By integrating experimentation directly into the observability workflow, Datadog empowers teams to not only ship features confidently, but also to test, measure, and iterate based on actual user behavior - all without leaving their existing stack.
This is a critical move in a software development landscape that increasingly values speed paired with accountability. Feature rollouts are no longer just a technical deployment decision; they’re strategic business bets. Eppo’s experimentation tools allow companies to de-risk those bets in real time, and with Datadog now bringing this capability in-house, it becomes a true end-to-end platform for both engineering and product teams.
A Competitive Moat for the Product-Led Era
The acquisition also reflects a broader shift in how successful software companies operate. Today’s high-performing teams aren’t just focused on uptime or performance metrics - they want to understand impact. In this product-led era, experimentation is becoming core infrastructure, and Datadog is positioning itself accordingly. By acquiring Eppo, it’s able to offer a unified experience that ties together observability, experimentation, and feature delivery - three pieces that are typically fragmented across tools like LaunchDarkly, Optimizely, and Amplitude.
Strategically, this also allows Datadog to expand its reach beyond DevOps into the product organization, increasing stickiness across departments. It strengthens its platform defensibility at a time when adjacent players are creeping into engineering workflows from the product and analytics side. Most importantly, it reflects a deeper philosophical shift: observability is no longer just about detecting failures - it’s about understanding success. And in that light, the acquisition of Eppo isn’t just a smart bolt-on - it’s a forward-looking bet on how modern teams will build, test, and scale products in the years ahead.
Geeks of the Week
Startup Name: SynthLabs
Geography: US
One-liner: Advancing research on AI alignment with built-in transparency and accountability.
Founder(s) Background: Chief of Staff at Stability AI, Research Director at Stability AI.
Thoughts:
SynthLabs is developing infrastructure to align advanced AI agents, focusing on systems that are autonomous, open-ended, and capable of long-term reasoning and interaction.
Their platform includes modular tools for interpretability, behavioral auditing, and agent control, enabling developers to observe and influence how LLMs operate in real time.
Alignment is approached as an ongoing process, not a one-time evaluation - emphasizing continuous feedback, testing, and adaptability as models are deployed in increasingly dynamic environments.
Use cases include safety-critical simulations, monitoring of agent behavior over time, and mechanisms for real-time intervention, which are essential for ensuring reliability in complex, real-world applications.
By focusing on practical, testable alignment infrastructure, SynthLabs is aiming to fill a critical gap between AI research and deployment, offering teams the tools they need to build more transparent and controllable systems.
Founder(s) building in stealth
Deals of the Week
Venture funding remained active during the week, with significant investments across AI, aerospace, climate tech, fintech, and health tech sectors. Here's a summary of the notable deals:
Anysphere – The developer of AI coding assistant Cursor raised $900 million at a valuation of approximately $9 billion. The round was led by Thrive Capital, with participation from Andreessen Horowitz (a16z) and Accel. Cursor is an AI-native development environment aimed at improving productivity for software engineers through code generation, refactoring, and collaboration features.
Apex – A Los Angeles-based satellite bus manufacturer, Apex raised $200 million in Series C funding. The round was co-led by Point72 Ventures and 8VC, with participation from a16z, Washington Harbour Partners, and StepStone Group. The funding will help Apex scale production of its Aries satellite buses and support the launch of new models for commercial and government customers.
Rainmaker – A climate tech startup using drones to stimulate rainfall, Rainmaker secured $25 million in Series A funding. The round was led by Lowercarbon Capital, with participation from Starship Ventures, 1517 Fund, Long Journey Ventures, Garry Tan, and Naval Ravikant. The company aims to address water scarcity by enabling localized, on-demand rainfall through atmospheric seeding technology.
Dawn Health – Based in Copenhagen, Dawn Health, a software-as-a-medical-device (SaMD) company, raised €11.5 million from Chr. Augustinus Fabrikker, the Export and Investment Fund of Denmark, and other Nordic investors. The company develops digital therapeutics and compliance tools used in chronic disease management.
Ace Aquatec – A Scotland-based aquaculture technology startup, Ace Aquatec raised £7.5 million in a round led by Stolt Ventures, with support from Scottish Enterprise and Aqua-Spark. The company provides sustainable solutions for fish farming, including humane stunning systems and AI-powered biomass management.
FoodHealth – San Francisco-based FoodHealth, a nutrition intelligence platform, raised $7.5 million in Series A funding, co-led by SpringTide Ventures and Better Ventures. The company provides personalized nutrition recommendations and products based on real-time biomarker data and lifestyle inputs.
Solena Materials – A London-based synthetic biology startup, Solena Materials raised $6.7 million in seed funding led by David Rowan’s VOYAGERS HealthTech Fund, with participation from SynBioVen, Insempra, and several strategic angels. The company engineers synthetic protein fibers for use in performance textiles and medical applications.
Skillvue – An Italian HR tech platform, Skillvue raised $6.3 million in seed funding led by 360 Capital, with participation from Italian Founders Fund, LVenture Group, and Business Angels Network. The platform uses AI to help employers assess soft skills and team compatibility during the hiring process.
Notable Mergers and Acquisitions
Strategic consolidation continues to shape the technology sector, as companies pursue acquisitions to gain competitive advantages, enhance capabilities, and scale faster in an increasingly AI-driven and data-intensive landscape. The past week featured notable M&A activity in AI cloud infrastructure, enterprise software, fintech, and automotive semiconductors.
One standout deal came from CoreWeave, which announced its acquisition of Weights & Biases, a widely used developer tools company for machine learning experiment tracking and model versioning. The move positions CoreWeave as a more comprehensive AI cloud platform, combining massive GPU infrastructure with enterprise-grade model management - key to meeting the needs of AI labs and startups scaling foundation models.
In the fintech sector, Apax Partners emerged as the lead bidder for Finastra’s Treasury and Capital Markets (TCM) business, in a deal reportedly valued at around $2 billion. The TCM division provides mission-critical infrastructure to banks and financial institutions globally. With Finastra majority-owned by Vista Equity Partners, the partial carve-out reflects a broader trend of PE firms refocusing on core assets while monetizing high-performing business lines.
Meanwhile, private equity powerhouse Thoma Bravo made headlines by acquiring Boeing’s Digital Aviation Solutions division for $10.55 billion. The deal underscores Thoma Bravo’s continued push into vertical enterprise software, especially in areas such as aviation analytics, fleet management, and digital air traffic systems. It also highlights how industrial conglomerates like Boeing are increasingly spinning off digital units to streamline operations and unlock value.
In Europe, Datatonic, a leading AI and cloud consultancy, acquired Syntio, a data engineering firm with strong footholds in telecommunications and central banking. The combined firm aims to accelerate enterprise AI adoption across regulated sectors in the EU, blending Datatonic’s genAI capabilities with Syntio’s technical implementation muscle.
Finally, Infineon Technologies deepened its push into autonomous mobility by acquiring Marvell’s automotive Ethernet business for $2.5 billion. As software-defined vehicles become more prevalent, Ethernet connectivity is essential for high-throughput sensor data and in-vehicle computing. This move fortifies Infineon’s ambition to lead the semiconductor backbone of next-gen vehicles.
These transactions reflect a broader pattern where strategic buyers - not just hyperscalers - are doubling down on capabilities that support cloud-native architectures, domain-specific analytics, and AI readiness. M&A is no longer just about scale - it’s increasingly a race for relevance in a rapidly transforming tech economy.
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