Legato raises $7M to let business users build AI apps inside SaaS platforms

Legato is betting that the next wave of AI innovation inside enterprise software won’t come from engineers. It will come from everyday business users.

The Tel Aviv–based AI startup has raised a $7 million seed round led by an Israel-based early-stage venture capital firm S Capital VC, with participation from Cerca Partners, to embed an AI app builder directly inside SaaS products. The goal is simple: let non-technical users create custom workflows, tools, and agents using plain language, right where they already work.

Led by co-founders Dana Rochman and Shlomit Tennenbaum, Legato positions itself as the first platform built to turn SaaS customers into in-product builders without sacrificing governance or security. The company plans to use the funding to scale R&D and grow its AI team.

This Israeli AI startup Wants Every SaaS User to Build Their Own AI Tools

For many SaaS vendors, customization remains a painful bottleneck. Large customers often spend months waiting for changes, paying consultants to tweak systems that were supposed to be flexible in the first place. In some cases, professional services swallow more than half of a company’s software budget. Even after that investment, adoption still stalls, churn creeps in, and expansion deals slip away.

That friction is pushing users to outside AI tools. Teams now spin up their own solutions with third-party agents and automation platforms, cutting vendors out of the loop. For SaaS companies, that means less visibility, weaker retention, and fewer ways to monetize their ecosystem.

Some vendors tried to solve this with no-code tools. Others rolled out features for vibe-coding aimed at admins and developers. Legato thinks those efforts miss the point.

“SaaS platforms are realizing that equipping developers and admins with better no-code or vibe-coding builders is no longer enough,” said CEO Dana Rochman. “The next battleground in the vendor AI race will be about empowering business users, the people closest to the problems, to build what they need themselves.”

Legato runs a multi-agent AI system behind the scenes that acts like a virtual professional services team. Users describe what they want in plain language. The system then generates production-ready apps, workflows, or agents inside the platform itself. Vendors keep full oversight, control, and data governance.

Rochman says the result flips the traditional services model on its head. Instead of waiting months for a ticket to be completed, users ship solutions in minutes. Platforms stay sticky. Customers feel ownership.

S Capital managing partner Aya Peterburg sees this as a missed revenue stream finally being unlocked.

“The professional services market is worth billions, driven by customization demand,” she said. “SaaS vendors have been leaving money on the table. Legato compresses months of work into hours. That shift changes unit economics for platforms facing growth slowdowns.”

Peterburg says the founders know this pain firsthand. Both Rochman and Tennenbaum come from enterprise backgrounds where customization was slow, costly, and tied to long consulting cycles. That experience shaped Legato’s product from day one.

The company calls its model the “Platform Creator Economy.” Instead of vendors shipping every feature, users build vertical apps inside the platform and publish them to marketplaces. Partners join in. New revenue flows back to the platform owner. Growth becomes community-driven.

Legato is already working with SaaS companies across CRM and HR tech. The team plans to move beyond software platforms into regulated sectors like finance, healthcare, telecom, and energy. Any system with APIs is a candidate for in-product AI.

Founded in 2025, Legato wants to make adaptability native to enterprise software. Its mission is straightforward: turn every user into a creator and every platform into a self-growing ecosystem.

For SaaS vendors fighting to stay relevant in an AI-first market, that pitch lands at the right moment.