Ex-Infosys CEO Launches Startup Aiming to Disrupt the IT Services Industry
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The Rise of AI in IT Services: Hang Ten Systems Takes the Leap
For decades, IT services firms generated billions by enabling companies to outsource various technological functions, such as customizing, integrating, and maintaining enterprise software. However, Vishal Sikka, the former CEO of Infosys, one of the leading IT firms in India, is shifting gears. He believes that artificial intelligence (AI) can largely replace these roles.
Hang Ten Systems: A New Venture with Strong Backing
Sikka’s latest venture, Hang Ten Systems, recently secured a $32 million seed funding round, primarily led by Mayfield, along with a strategic investment from Aramco Ventures and contributions from angel investors. The startup, which boasts a board that includes Yahoo co-founder Jerry Yang, aims to assist enterprises in continuously building, modifying, and managing software through AI-driven development and automation.
Entering a Competitive Market
Hang Ten is stepping into a competitive market, where established IT services firms like Infosys are already racing to incorporate AI in their operations. These companies are forging partnerships with industry leaders like Anthropic and OpenAI to adapt to the changing technological landscape.
The launch of Hang Ten occurs amidst an ongoing debate about whether AI will broaden the industry’s addressable market or fundamentally transform how enterprise software is developed and maintained. Companies are increasingly interested in exploring AI-driven services, especially from someone as seasoned as Sikka, who has an extensive background in enterprise software from his tenure at SAP and Oracle.
Early Customer Engagement and Plans for Growth
According to Mayfield managing partner Navin Chaddha, Hang Ten has begun its journey with clients just a month after its inception. The startup is engaged with notable companies like Siemens Gamesa Renewable Energy and Fresenius on AI-native project delivery. In a recent blog post, Sikka noted that Hang Ten is poised to help large enterprises “hang ten on the biggest wave of our lifetimes.”
Based in the Bay Area, Hang Ten is actively hiring across various roles—delivery, engineering, sales, and leadership—and plans to expand to multiple global locations to meet increasing enterprise demand.
A Team with Proven Expertise
The initial team at Hang Ten includes seasoned executives who have collaborated with Sikka at SAP, Infosys, and his previous venture, VianAI. Key members include Navin Budhiraja, the startup’s CTO; Sanjay Rajagopalan, the chief design officer; and Tao Liu, the senior vice president of forward-deployed engineering.
After leaving Infosys in 2017, Sikka established VianAI, which emerged from stealth mode in 2019, raising $50 million in seed funding and later acquiring $140 million in a round led by the SoftBank Vision Fund 2 in 2021.
Differentiating Hang Ten from Previous Ventures
Chaddha emphasizes that Hang Ten is distinct from VianAI, which focused on enterprise AI applications and analytics tools aimed at enhancing business decision-making through AI. In contrast, Hang Ten positions itself as an AI services company centered around agentic code generation, reusable AI skills, and domain-specific expertise.
Mayfield’s investment in Hang Ten stems from their confidence in Sikka’s extensive experience, as well as their belief that the startup’s AI-native model can scale in ways that traditional service firms cannot. Mayfield stated, “Traditional services scale linearly with headcount. Hang Ten is designed for its leverage to grow with every project.”
Industry Disruption and Economic Impact
As Hang Ten emerges, debates around how AI will affect the economics of the IT services industry intensify. Analysts at Jefferies have suggested that IT services may be among the earliest sectors to experience significant disruption from AI. Conversely, Infosys chairman Nandan Nilekani recently claimed that AI could actually broaden the industry’s market potential.
Indeed, Infosys has been promoting AI as an opportunity rather than a threat, announcing to investors that “AI-first services” could represent a market size of $300 billion to $400 billion by 2030.
Conclusion: A New Era for IT Services
Investors are increasingly reassessing the outlook for traditional IT services firms, especially given that Infosys shares have plummeted by over 35% this year. Hang Ten Systems stands at the forefront of this evolving landscape, leveraging AI to redefine how enterprise software is built and maintained. As the startup continues to grow, it may very well play a key role in reshaping the future of IT services.
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