Datadog is doubling down on product experimentation and analytics. Just weeks after acquiring Metaplane, an AI-driven observability startup, the cloud monitoring giant has snapped up another key player—Eppo, a San Francisco-based platform focused on feature flagging and experimentation.
The deal will see Eppo continue to operate under the new brand “Eppo by Datadog,” supporting current customers while welcoming new ones. While Datadog hasn’t confirmed financial details, Upstarts Media recently reported a price tag of around $220 million.
This acquisition signals Datadog’s commitment to making experimentation infrastructure more accessible. Although developers increasingly need tools to test app variations and optimize performance, building the backend for rigorous testing—especially in AI workflows—is often technically challenging. From setting up data pipelines to running advanced statistical analyses, many teams struggle to scale experimentation effectively.
Eppo’s platform addresses this by providing a more intuitive way to run randomized tests. It includes “confidence intervals” that help teams clearly interpret results. The tool also supports real-time testing for AI and machine learning models, allowing users to see which model outperforms another as experiments run live.
From Airbnb to AI: Eppo’s Growth Story
Eppo was born from firsthand frustration. Its co-founder and CEO Che Sharma, a former data scientist at Airbnb and Webflow, saw the limitations of traditional experimentation tools. He built Eppo to streamline testing for modern product teams—particularly those working with AI.
Before the acquisition, Eppo had raised $47.5 million from top-tier investors including Innovation Endeavors, Menlo Ventures, and Amplify Partners. As of mid-2022, it operated with a lean team of around 15 employees and served brands like Goldbelly, Netlify, and Kumu.
What made Eppo stand out in a competitive space filled with companies like Split, Statsig, and Optimizely? According to Sharma, it’s the platform’s ability to foster a high-velocity, experiment-first culture, regardless of a company’s size or stage.
In a joint statement, Sharma emphasized how the acquisition will amplify that mission:
“With Datadog, we are uniting product analytics, feature management, AI, and experimentation capabilities for businesses to reduce risk, learn quickly, and ship high-quality products.”
A Strategic Move in a $27B Market
This acquisition also gives Datadog an edge in the booming product analytics market, which was valued at $9.09 billion in 2024 and is projected to reach $27.01 billion by 2032, according to Fortune Business Insights.
Datadog’s VP of Product, Michael Whetten, noted that as companies deploy multiple AI models, it becomes increasingly complex to track performance and impact.
“Experimentation solves this correlation and measurement problem. It lets teams evaluate models side-by-side, analyze user engagement versus cost, and build AI products that deliver measurable value,” he said.
As Datadog continues to evolve its product suite, integrating Eppo’s experimentation engine could give developers and data teams powerful new ways to test, iterate, and deploy confidently in production—especially in the age of AI.
