SAP acquires AI startup Prior Labs to supercharge business intelligence tools
SAP has agreed to buy Freiburg-based AI startup Prior Labs in a deal aimed at boosting its business intelligence tools. The acquisition focuses on advancing Tabular Foundation Models (TFMs), a new approach to analysing enterprise data. Regulatory approval is still required, with completion expected in 2026. Prior Labs was founded by Frank Hutter, Noah Hollmann, and Sauraj Gambhir, with backing from AI pioneer Yann LeCun. The startup specialises in TFMs, which help businesses extract deeper insights from structured data. SAP sees this technology as a key area for growth in business AI.
The deal is part of SAP’s broader strategy to strengthen its position in artificial intelligence. Over the next four years, the company plans to invest more than one billion euros into Prior Labs. Despite the acquisition, the startup will continue operating independently.
SAP’s move signals a major bet on TFMs, a category of AI designed specifically for enterprise applications. The Prior Labs team will play a central role in accelerating the development of these models within SAP’s existing product range. If approved, the acquisition will expand SAP’s AI capabilities with a focus on tabular data analysis. The investment of over one billion euros highlights the company’s commitment to this emerging field. Prior Labs will remain a separate entity while contributing to SAP’s long-term AI strategy.
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