The IT services industry is built on a simple idea: large companies are bad at managing their own software, so they outsource it. Setting up an ERP system, connecting it to other tools, writing custom code to make it fit your specific process, then maintaining all of it year after year: that work goes to firms like Infosys, Accenture, TCS, or Wipro. They hire thousands of people, bill clients for their time, and grow by hiring more.
Vishal Sikka spent years inside that world. He was SAP's first-ever chief technology officer, where he spent 12 years leading product development and is credited with building SAP HANA, the database platform that became one of SAP's fastest-growing products. He then ran Infosys from 2014 to 2017 as its first non-founder CEO, trying to push the firm toward AI and automation before leaving amid a dispute with the founding family.
His new startup, Hang Ten Systems, launched today with $32 million raised from venture firm Mayfield and Aramco Ventures, the investment arm of Saudi Arabia's state oil company. The company describes itself as doing enterprise AI services: building, modifying, and running software using AI-generated code and automated processes rather than large teams of consultants. It already has customers including Siemens Gamesa and Fresenius, despite being only one month old.
The argument Hang Ten is making is not subtle. Traditional services firms charge more when they add more people. AI, in theory, breaks that link. One small team with the right AI tools can potentially handle what previously required hundreds of consultants. Mayfield, its lead investor, put it directly: "Traditional services scale linearly with headcount. Hang Ten is built so its leverage grows with every project."
The backdrop for this launch is rough for the incumbents. Accenture's stock fell around 18% in a single session last week after it cut revenue guidance, a record single-day drop that dragged Infosys, Capgemini, and others down with it. Infosys and Capgemini are both down more than 30% this year. A Microsoft executive recently said publicly that Accenture probably does not need 750,000 employees, and TCS does not need its 600,000. Analysts at Bloomberg Intelligence wrote that "AI is disrupting demand across consulting and managed service."
The disruption is not yet visible in the revenue numbers of the big firms. Accenture still grew 3% and posted strong earnings. But investors are pricing in what they think happens next, not what happened last quarter. The fear is structural: if AI agents can compress the amount of human work needed for a typical software integration by ten to fifteen times, the economics of these firms break, not immediately, but permanently.
For business operators who buy these services, this is worth watching closely. The IT services market is entering a period where prices are under pressure, new competitors are entering with fundamentally different cost structures, and the large incumbents are scrambling to reposition. Hang Ten is one startup among several trying to prove the AI-native model works. If it does, even partially, it shifts negotiating power toward the buyer.
Sikka's previous AI venture, VianAI, raised $190 million and focused on AI decision-making tools for enterprises. Hang Ten is a different bet: not AI tools on top of existing work, but AI replacing the work itself. The $32 million seed round is large for a one-month-old company. The Aramco Ventures participation suggests interest from the energy sector, which relies heavily on complex enterprise software and has historically been a big buyer of IT services. Whether Hang Ten can scale beyond its first handful of customers is an open question, but the signal it sends to anyone currently renewing a large IT services contract is clear: the price of this work is going down.