Sawmills Exits Stealth with $10M to Tackle Skyrocketing Observability Costs Using AI

SAN FRANCISCO, Feb. 19, 2025 — Sawmills, the first smart telemetry data management platform, emerged from stealth today with $10 million in seed funding. The highly oversubscribed round was led by Team8, with participation from Mayfield and Alumni Ventures.

Founded by enterprise software veterans who were previously executives at New Relic, CloudBees, and Tricentis. Sawmills’ AI-powered platform allows enterprises to manage the data flowing from engineering teams to their observability tools, identifying opportunities for cost reduction while enhancing critical monitoring capabilities.

As modern software architectures grow more complex, observability has become critical for maintaining reliable systems – but organizations face dual challenges of unsustainable costs and data quality issues. The median company now spends nearly $2M annually on observability, and the majority of companies report experiencing unexpected cost spikes on a monthly basis. The scale of the problem was highlighted when a financial services firm was famously hit with a staggering $65M observability bill from Datadog.

“Engineering teams are grappling with both cost and quality challenges in their observability data,” said Ronit Belson, CEO of Sawmills, who founded the company alongside Amir Jakoby and Erez Rusovsky. “Missing data points, inconsistent formats, and duplicate data drive up costs and make root cause analysis unreliable and time-consuming. Observability has become the second-largest expense after cloud costs for most companies. In our conversations with VPs of Engineering at leading companies, they consistently tell us that up to 90% of their observability data is useless – yet they’re still paying to collect, process, and store all of it.

“Unpredicted spikes are another major challenge. We recently spoke with one company where a single developer’s mistake led to $250,000 in additional fees in just one day. Engineering teams need intelligent telemetry data management that not only improves data quality but also prevents costly mistakes before they happen. Sawmills automatically identifies optimization opportunities and implements guardrails to protect against unexpected cost spikes while ensuring you capture the data that matters.”

Sawmills enables companies to optimize their observability practices through intelligent data management. The platform uses AI models to analyze telemetry data as it streams through the system, automatically identifying opportunities to reduce spending, improve data quality, and prevent observability system outages. Companies can implement Sawmills’ recommendations with a single click and set automated policies to prevent unexpected cost spikes and availability issues. The platform’s intelligent routing capabilities not only direct data to cost-effective storage solutions but also provide organizations with the freedom to switch between observability vendors without disrupting their monitoring infrastructure.

The impact of Sawmills’ approach is already evident among early adopters. Edi Buslovich, a VP of Engineering at Via, said: “Partnering with Sawmills has set us on a path toward optimizing our telemetry data—paving the way for streamlined costs, improved observability resource allocation aligned with our business needs, and enhanced data governance.”

“Telemetry data management is emerging as a critical new category in enterprise cloud infrastructure,” said Liran Grinberg, Managing Partner at Team8. “The Sawmills team has a deep understanding of the problem and a comprehensive vision that perfectly positions them to own this new category. This isn’t just about cost reduction; we believe Sawmills’ approach to intelligent telemetry data management will massively improve observability and become essential infrastructure for modern enterprises.”

Built on the OpenTelemetry Collector, Sawmills enhances this widely adopted open-source standard with advanced AI-powered capabilities to deliver:

• Real-time Processing: The platform’s AI-powered engine processes logs, metrics, and traces as they stream in, automatically detecting and fixing issues like missing data points and inconsistent formats while optimizing costs through smart sampling, routing, dropping, aggregation and more.
• Comprehensive Control: Organizations gain complete control over their observability strategy through smart policies that automatically enrich telemetry data, improve data quality, and protect against unplanned data spikes and system outages.
• Vendor Flexibility: Sawmills’ architecture ensures enterprises can maintain robust observability while having the freedom to adapt and switch between observability vendors as their needs evolve.

To learn more about how Sawmills can help your organization optimize observability costs and improve data quality, visit www.sawmills.ai.

About Sawmills

Sawmills empowers engineering teams to manage, optimize, and act on their telemetry data. By addressing inefficiencies, mitigating costly data spikes, and improving data quality, Sawmills enables businesses to reduce expenses and enhance the effectiveness of their observability systems.

Source: Sawmills