From Research Project to $1.15 Billion SAP Exit in Just 18 Months

Jan de Vries · 2026-07-17

Berlin-based frontier AI lab Prior Labs just made a move that's turning heads across the tech world. They announced today that SAP has acquired them, backed by more than $1.15 billion in investment. That's right, over a billion dollars for an 18-month-old company. This isn't your typical startup story. Prior Labs will keep its own brand, leadership, and research agenda. They'll still publish their work and make their models openly available. All of this comes after their $10.5 million pre-Seed round back in 2025. ### The Backstory Frank Hutter, co-founder and CEO, puts it simply: "Eighteen months ago, Prior Labs was a research project. Today we're beginning our next chapter as an AI lab with the resources to tackle problems we simply couldn't before." Hutter explains that taking tabular foundation models to the next level requires better data environments, deployment surfaces, and long-term research investment. SAP is uniquely positioned to provide all of that. ### What's the Big Deal? Prior Labs isn't just another AI company. They pioneered tabular foundation models (TFMs), a category of AI built specifically for enterprise data. Instead of training a separate model for every dataset, their TabPFN uses one pre-trained foundation model. It can handle prediction tasks like payment delays, churn, supplier risk, and demand forecasting directly from structured enterprise data. Their technology is already making a difference. It's helping Hitachi prevent train failures. It's improving financial forecasting with TD. And it's been applied across hundreds of published research projects, from pancreatic cancer diagnosis to wildfire prediction to next-generation battery materials. ### The Bigger Picture SAP's acquisition follows substantial investment in European infrastructure for training, deploying, and governing enterprise AI. EU-Startups' 2026 coverage includes roughly $2.25 billion across comparable companies. The biggest rounds include: - Nscale's $1.98 billion AI-compute round - Verda's $116 million financing - Investments in enterprise data, memory, and ERP infrastructure at Conduct, OpsMill, and Modern Relay Germany has produced several direct comparisons too, including Berlin-based SPREAD, Cognee, and Qorelo, as well as Stuttgart's Blockbrain and Munich's Interloom. ### What SAP Sees Philipp Herzig, CTO of SAP, explains their thinking: "Early on, SAP recognised that the greatest untapped opportunity in enterprise AI wasn't large language models; it was AI built for the structured data that runs the world's businesses." He adds that Prior Labs has defined the category of TFMs and built the world's strongest research team in this space. They've topped public benchmarks since day one. ### What's Next This acquisition lets Prior Labs pursue multi-year frontier research programs that would have been impossible for an 18-month-old company. They'll have access to enterprise data environments and long-term investment. The team plans to push into enterprise AI, scientific discovery, causality, relational data, and agentic systems. They're even talking about "moonshots" toward solving some of the biggest problems of our time, like medical data and material sciences. Founded in 2024 by Frank Hutter, Noah Hollmann, and Sauraj Gambhir, Prior Labs has come a long way fast. With SAP's backing, they're positioned to take enterprise AI to places we haven't seen before.