In the bustling tech hub of Seattle, a new player is emerging to tackle one of software engineering’s thorniest challenges: managing the human side of code creation. Actual AI, a startup founded by industry veterans Ethan Byrd and John Kennedy, has secured $3.2 million in seed funding to develop AI agents specifically designed for engineering managers. This investment, led by Madrona Venture Group with participation from PSL Ventures and notable angels like Amazon Web Services executive Matt Wood, underscores a growing interest in tools that bridge the gap between automated coding and team leadership.

The company’s vision, as detailed in a recent report from GeekWire, centers on creating AI assistants that handle the “soft skills” often overlooked by existing coding bots. While tools like GitHub Copilot excel at generating code snippets, Actual AI aims to assist managers with tasks such as reviewing pull requests, optimizing team workflows, and even providing feedback on code quality in a nuanced, context-aware manner.

The Founders’ Bet on Managerial AI

Byrd and Kennedy bring complementary expertise to the table. Byrd, previously a product leader at Meta, witnessed firsthand the bottlenecks in engineering teams during rapid scaling. Kennedy, with his background in AI at startups like Polyverse, saw an opportunity to apply agentic AI—systems that can act autonomously—to managerial duties. Their pitch: AI agents that don’t just write code but help orchestrate the people who do.

This approach comes at a time when AI is reshaping software development. According to insights from GeekWire‘s survey of top Seattle startups, nearly all respondents report productivity gains from AI, yet many struggle with integration into leadership roles. Actual AI’s agents are built to integrate with existing tools like Jira and Slack, potentially reducing the managerial overhead that can bog down fast-growing tech firms.

Seattle’s AI Funding Surge

The funding round positions Actual AI amid a wave of AI investments in the Pacific Northwest. Seattle’s startup ecosystem has seen over $679 million poured into AI ventures this year alone, as noted in a Greater Seattle economic overview. Competitors like Bridgetown Research, which raised $19 million for AI-driven research automation, highlight the region’s focus on specialized AI applications.

For engineering managers, the promise is transformative. Imagine an AI that not only flags inefficient code but also suggests team reassignments based on performance data, all while maintaining ethical boundaries around privacy. Byrd emphasized in the GeekWire profile that their agents are trained on anonymized datasets to avoid biases, drawing from lessons learned in his Meta tenure.

Challenges and Broader Implications

However, scaling such technology isn’t without hurdles. Critics in the industry point to potential over-reliance on AI for decisions that require human empathy, such as mentoring junior developers. Actual AI plans to address this by incorporating feedback loops where managers can refine agent behaviors, ensuring the tool augments rather than replaces human oversight.

Looking ahead, this funding could catalyze further innovation in AI for enterprise management. As Seattle vies to become a leader in the AI era—a topic explored in a GeekWire roundtable with investors—the success of startups like Actual AI will test whether the city can nurture tools that evolve beyond code generation to true organizational intelligence.

Investor Confidence and Market Potential

Madrona’s involvement signals strong belief in the model’s viability. Tim Porter, a managing director at the firm, told GeekWire that Actual AI addresses a “critical pain point” in software engineering, where managers spend up to 40% of their time on administrative tasks. With the global market for AI in project management projected to explode, the startup’s early traction—already piloting with select tech companies—suggests a path to rapid adoption.

Ultimately, Actual AI represents a microcosm of Seattle’s AI ambitions: leveraging local talent from giants like Amazon and Microsoft to build niche solutions that could redefine industries. As the company moves toward a beta launch later this year, industry watchers will be keen to see if its agents can truly empower managers without disrupting the human element at the heart of innovation.