Manny Medina’s AI Startup Paid Secures $21.6 Million for Revolutionary Results-Based Billing, Valued Over $100 Million

Entrepreneur Manny Medina, renowned as the founder of sales automation startup Outreach valued at $4.4 billion, has generated buzz among investors with his burgeoning venture, Paid.

Paid recently concluded an oversubscribed $21.6 million seed funding round spearheaded by Lightspeed. With the €10 million pre-seed funding raised in March, London-based Paid has amassed a total of $33.3 million, prior to reaching its Series A. Sources close to the deal suggest the startup’s valuation surpasses $100 million.

Emerging from stealth mode in March, Paid introduces an intriguing proposition to the AI-driven world: The company doesn’t offer AI agents, instead providing a means for agent creators to bill their clients based on the value these work algorithms deliver. This strategy, often termed “results-based billing,” is gaining traction in the AI sector.

Paid aims to empower agent creators to start charging for “points of margin saved by their customers,” as Medina describes. This marks a shift in software pricing models, moving away from unlimited use or per-user fees typical of the SaaS era, and the buy-it-once-and-install-it fees common in the client/server era.

Per-user fees pose issues for agent creators since they pay usage fees to model providers as well as cloud providers. Unlimited use could lead to financial losses. The AI development sphere tends to struggle with this issue.

Agent providers, Medina explains, “need to demonstrate the value the agent is delivering to your customers because agents are primarily operating in the background.” Effective agents will be assigned more tasks, their growing workloads often going unnoticed.

“If you’re a silent worker, you don’t get compensated,” Medina notes. “You need an infrastructure that enables the agent to charge for the additional work it performs.”

Charging a monthly fee for a limited number of credits mirrors the models used by model makers and vibe coders, but carries risks for agent creators. This is because companies are wary of paying for AI outputs lacking value, with recent MIT research indicating that 95% of enterprise AI projects have no value, with only 5% being implemented.

Companies are reluctant to pay for AI-generated content that goes unread. One of Paid’s early customers, for example, is Artisan, the high-profile sales automation startup. (Artisan’s CEO Jaspar Carmichael-Jack will speak on this topic at TechCrunch Disrupt next month.)

Paid is also experiencing success with SaaS companies exploring AI agents as a growth strategy. The startup recently secured ERP vendor IFS as a new client, according to its announcement.

Lightspeed’s Alexander Schmitt states that the venture firm has invested over $2.5 billion in AI infrastructure and application layer companies over the past three years, and has witnessed firsthand that most AI pilots fail.

“The core issue is that no one can assign value to what agents are doing today,” Schmitt says. He believes Paid presents a unique approach, stating, “this is something we haven’t seen someone else build.” As competition in the results-based billing market for AI agents grows, it’s likely more players will emerge if Paid’s strategy indeed helps agents join the workforce en masse.

New investor FUSE and existing investor EQT Ventures also took part in the funding round.