Code Metal raises $125 million to rewrite defense industry code with AI

Code Metal, a Boston-based startup that uses AI to write code and translate it into other programming languages ​​just closed a $125 million Series B funding round from new and existing investors. The news comes just a few months after the startup raised $36 million in Series A funding led by Accel.

Code Metal is part of a new wave of startups aiming to modernize the tech industry by using AI to generate code and translate it across programming languages. One of the lingering questions about AI-assisted code, however, is whether the output is good — and what the consequences might be if it’s not.

Over the past two years, companies like Antithesis, Code Rabbit, Synthesized, Theorem, and Harness have all received millions in venture capitalist backing for their approaches to automating, validating, testing, and securing AI-generated code. These startups are selling the “picks and shovels” of the AI ​​gold rush—tech tools that serve a larger industry. While some of the methodologies behind their technology remain unproven, investors are willing to gamble that at least a few will pan out.

Founded in 2023, Code Metal has focused its efforts on code translation and code verification for the defense industry. It boasts L3Harris, RTX (formerly known as Raytheon), and the US Air Force as early customers. The startup is also working with Japanese electronics company Toshiba and says it is in talks with a major chip company to work on code portability across chip platforms, though the company declined to say which one.

The startup’s software platform translates code from high-level programming languages ​​like Python, Julia, Matlab, and C++ to lower-level languages ​​or code that runs on specific hardware, like Rust, VHDL, and chip-specific languages ​​like Nvidia’s CUDA.

Code Metal CEO Peter Morales, who previously worked at Microsoft and the MIT Lincoln Laboratory, says the market is beginning to recognize “the big tentpole problems” in an industry that could be supported by AI-generated code in the not-so-distant future. One of those problems is porting old code to new applications. If a government agency or defense contractor needs to do coding work quickly, Morales says, but only has access to engineers who specialize in a legacy programming language, it slows everyone down.

Morales quotes a recent post on X from the well-known AI researcher Andrej Karpathy, who observed, among other things, the “rising momentum behind the transfer from C to Rust”. Karpathy concluded, “It feels likely that we’ll end up rewriting large chunks of all software ever written many times over.”

“That’s all we do in one tweet,” Morales says.

One of Code Metal’s investors, Yan-David Erlich, a general partner at B Capital, says the reality is that some of the code that controls essential communications infrastructure, and even satellites, “is old, it’s dodgy, it’s written in programming languages ​​that people may not use anymore. It needs to be modernized.”

“But in the course of translation,” Erlich added, “you might have errors in—which is catastrophically problematic.”

That’s where Code Metal says its proprietary technology comes in. Morales says that at each step of translation, Code Metal’s software generates a series of test harnesses—a virtual container of data and tools—that evaluate the code and show customers along the way that it works. Asked about Code Metal’s error rate for translation, Morales says it largely depends on how difficult the code conversion is, but that for the Code Metal pipelines currently running, “there’s no way to generate an error. The software will just say, ‘There is no solution for this’ if we can’t complete the translation.”

The startup is shy about sharing too many details about its methodology. However, one element of the business it is not shy about talking about is its approach to pricing.