SAP bets $1.16 billion on 18-month-old German AI lab and says yes to NemoClaw

“We have yet to really see AI penetrate enterprise business processes,” the OpenAI COO admitted last February. But for enterprise software giant SAP, whose shares fell dramatically in 2026 in part because of the “SaaSpocalypse,” the issue is still at the forefront.

The European heavyweight announced on Monday its intention to acquire German AI startup Prior Labs for an undisclosed sum. Pending regulatory approval, SAP plans to invest 1 billion euros (about $1.16 billion) in the business over the next four years to develop it into an artificial intelligence laboratory focused on structured data — the tables and databases where enterprise information typically resides.

SAP declined to disclose how much it spent on the acquisition itself, but sources told Pathfounders that this was a healthy exit: an “almost all-cash” deal, with more than half a billion dollars in cash provided to the startup’s founders — Frank Hütter, Noah Holman, and Suraj Gambhir.

The trio co-founded Prior Labs just 18 months ago with a focus on tabular basis models (TFMs) — artificial intelligence models that can make predictions from data in tables and databases. This is probably more relevant to organizations than linguistic models. It is certainly a better fit for SAP, whose widely used software products for accounting, human resources, purchasing and expense management rely on its database.

However, Germany’s most valuable company appears to be playing a defensive role as the tech industry moves toward agentic AI. As it worked to build its AI lab, the company blocked OpenClaw and any other proxy technology it didn’t explicitly allow, which The Information was first to spot.

In response to a request for comment, SAP’s press department referred TechCrunch to the company’s latest API policy, which states that SAP “prevents” AI agents from accessing its products through its API except for those that are “SAP-certified builds.”

Approved architectures of course include SAP’s own offering, Joule Agents, still in beta, which allows customers to create their own agents. Nvidia also announced in March that SAP’s Joule software supports Nvidia Agent Toolkit, a software for managing agents. This toolset is the foundation for Nvidia’s enterprise-ready, security-focused OpenClaw competitor, NemoClaw. SAP customers will then be allowed to use NemoClaw agents.

For an existing giant like SAP, AI represents both a threat and an opportunity. “It’s all about how fast [we can] SAP is actually legislating as well [on] These technologies are in our R&D portfolio to maintain the advantage of relative economies of scale,” CFO Dominic Assam told CNBC in January.

SAP was not sitting on its hands. The German company has invested in generative AI companies that develop large and small language models: in 2023, it backed OpenAI competitor Anthropic – as well as Aleph Alpha and Cohere, which now intend to merge to form a “global AI powerhouse.”

It also developed SAP-RPT-1, a pre-trained relational transformer model. “Early on, SAP recognized that the greatest untapped opportunity in enterprise AI was not big language models; it was AI designed for the structured data that runs the world’s businesses,” SAP CTO Philip Herzig announced in a statement.

But the Prior Labs acquisition is an important shortcut in that direction. Its TabPFN template series has seen a lot of traction among developers. In a blog post about the deal, the startup’s founders said that its open source models have been downloaded more than three million times.

In a press release, SAP promised that Prior Labs would keep the releases open source: “The lab will operate as an independent unit to ensure research speed while SAP provides long-term investment and a direct path to production across the SAP portfolio using SAP AI Core and SAP Business Data Cloud as well as the agent layer with Joule.”

SAP and the startup, which is headquartered in Freiburg, Germany, hope this investment will lead to TFM devices capable of collecting data in the tables in which it resides, and combining it with language, reasoning, and domain knowledge.

What’s more, they hope that, with this “massive push” from SAP, Prior Labs will become “the world’s leading AI lab for structured data — in Europe, openly,” as founder and CEO Frank Hütter celebrated in a post on X.

In February 2025, the startup had previously raised about $9.3 million in a pre-seed funding round led by Balderton Capital — more than rival Neuralk-AI, but significantly less than Fundamental, which emerged from stealth with a $255 million Series A in February.

In a post on X, Balderton partner James Wise described the Prior Labs acquisition as “one of the largest venture outcomes in Germany ever.” As for SAP, its stock is currently trading slightly higher.

At the same time, SAP has become very strict about which agents it will allow into its ecosystem. This is a very different approach from Salesforce, which is another concern that fell into SaaSpocalypse. It allows organizations to choose their agents, including OpenClaw if they wish, through its new headless 360 architecture.