Eight salespeople from ServiceNow and its newly acquired subsidiary, Moveworks, have jumped ship to rival startup Serval in recent months, Business Insider has learned.
ServiceNow is a cloud computing software company whose stock has tumbled 40% in the last six months in the so-called SaaS-pocalypse, as investors fear AI could decimate the profit margins of software giants. In an effort to stay one step ahead in the AI race, ServiceNow closed an all-cash $2.85 billion acquisition of Moveworks in December to create an "AI-native front door."
The same month, Serval closed a $75 million Series B funding round led by Sequoia Capital, valuing the rapidly growing AI-powered IT support startup at $1 billion. Sequoia was also an early investor in ServiceNow.
Eight employees represent a fraction of ServiceNow's 29,000-person workforce. Still, the exodus shows how difficult it can be for tech companies with falling valuations to retain talent when buzzy, well-funded AI companies come calling. A ServiceNow spokesman declined to comment.
The highest-level departure is Brad Patterson, who had been a ServiceNow sales VP for nearly two years.
"AI is really making serious moves," Patterson said in an interview. "In a similar way, market sentiment is responding; I think people are responding in the same way."
Every incumbent tech company is facing a similar talent drain, according to Jules Levy, ServiceNow's former head of enterprise generative & enterprise AI, who is also among those joining Serval.
"I don't think this is unique to ServiceNow," he said in an interview. "Many folks within those incumbents are looking to jump to AI-native platforms that will be able to move really fast and take advantage of this technological wave."
"I think everyone's trying to figure out what comes next," he added.
Serval is not specifically targeting ServiceNow employees, but when one employee leaves, it can have a ripple effect, according to Tatiana Birgisson, Serval's chief operating officer.
"If you hire really good people, other really good people in their network want to follow them," she said, citing Chris Comes, who became a Serval VP of Sales in November after more than three years at MoveWorks. "Multiple people got excited about seeing the announcement of his going to Serval."
Startups have usually offered less job security and lower cash compensation than public tech companies, but Birgisson says tech downsizing has made it easier to recruit candidates.
Block CEO Jack Dorsey cut roughly 40% of his workforce in February, citing the rise of AI. Meta could reportedly lay off a fifth of its staff amid skyrocketing AI costs.
"Big Tech no longer feels as safe as it once did," Birgisson said. "We are starting to see more candidates who, 5-10 years ago, would not have considered working at a startup, but are now more open to it because there isn't the clear divide between 'secure' and 'risky' jobs."
