As the OpenAI COO himself admitted last February, “We’re yet to see AI really permeate enterprise business processes.” But the issue remains at the forefront of enterprise software giant SAP, whose stock price fell sharply in 2026, in part due to the SaaSpocalypse.
On Monday, a leading European company announced its intention to acquire German AI startup Prior Labs for an undisclosed sum. Pending regulatory approval, SAP plans to invest €1 billion (approximately $1.16 billion) in the business over the next four years to grow it into an AI lab focused on structured data (the tables and databases where company information typically resides).
SAP did not disclose how much it spent on the acquisition itself, but sources told PathFounders that it was a healthy exit. The “mostly cash” deal saw the startup’s founders Frank Hitter, Noah Holman and Sauraj Gambhir receive well over $500 million in cash upfront.
The trio co-founded Prior Labs just 18 months ago with a focus on tabular foundation models (TFM), AI models that can make predictions from data in tables and databases. This may be more suitable for enterprises than language models. For SAP, there is no doubt that its software products, which are widely used in accounting, human resources, procurement, and expense management, rely on databases.
But as the tech industry moves toward agent-like AI, Germany’s most valuable company also appears to be playing a defensive role. The company is working to establish its own AI lab, but is blocking OpenClaw and other agent technologies it doesn’t explicitly authorize, The Information first discovered.
In response to a request for comment, SAP’s press department referred TechCrunch to the company’s latest API policy, which states that SAP “prohibits” AI agents from accessing its products through APIs except on “SAP-approved architectures.”
Of course, the licensed architecture includes Joule Agents (still in beta), SAP’s own service that allows customers to create their own agents. Nvidia also announced in March that SAP’s Joule supports Nvidia’s Agent Toolkit, an agent management software. This toolkit is the foundation of NemoClaw, Nvidia’s enterprise-ready, security-focused OpenClaw competitor. Therefore, SAP customers are allowed to use the NemoClaw agent.
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For large incumbents like SAP, AI is both a threat and an opportunity. “It’s all about whether SAP can actually launch these technologies into its R&D portfolio as well, in order to maintain relative economies of scale,” CFO Dominik Asam told CNBC in January.
SAP isn’t sitting idle. The German company invests in generative AI companies that develop language models large and small. In 2023, it backed OpenAI rival Anthropic. It also backed Aleph Alpha and Cohere, which are now slated to merge to form a “global AI powerhouse.”
We also developed a relational pretrained transformer model, SAP-RPT-1. “SAP recognized early on that the biggest untapped opportunity in enterprise AI was not large-scale language models, but AI built for the structured data that runs the world’s businesses,” SAP CTO Philipp Herzig declared in a statement.
But the acquisition of Prior Labs is an important shortcut in that direction. Its TabPFN model series has attracted a lot of attention among developers. In a blog post about the deal, the startup’s founders said their open source model has been downloaded more than 3 million times.
SAP promised in a press release that Prior Labs will maintain an open source version. “While this lab will operate as an independent unit to ensure research velocity, SAP will provide long-term investment and a direct path to productization across the SAP portfolio, including SAP AI Core and SAP Business Data Cloud, as well as Joule’s agent layer.”
SAP and the Freiburg, Germany-headquartered startup hope this investment will lead to TFM, where SAP can take data in tables that reside and combine it with language, reasoning, and domain knowledge.
More than that, they hope Prior Labs will become the new “world-leading frontier AI lab for structured data, open in Europe” with this “massive boost” from SAP. Founder and CEO Frank Hutter celebrated in a post on X.
The startup had previously raised approximately $9.3 million in a pre-seed funding round led by Balderton Capital in February 2025. That’s more than competitor Neuralk-AI, but much less than Fundamental, which emerged from stealth with a $255 million Series A in February.
In a post on X, Balderton partner James Wise called the Prior Labs acquisition “one of the biggest venture achievements in German history.” As for SAP, the stock price is currently up slightly.
SAP, on the other hand, is very strict about the agents it allows into its ecosystem. This is a very different approach than Salesforce, another incumbent company caught up in SaaSpocalypse. The new Headless 360 architecture allows businesses to choose their own agents, including OpenClaw, if they wish.
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