BetterAuth Raises $5M Seed Funding - Peak XV, YC

A Solo Founder's Rise in Developer Infrastructure

The creation of a widely utilized developer infrastructure tool by a single founder is an uncommon occurrence. This is particularly noteworthy when the founder originates from the African continent.

Bereket Engida, a programmer who is self-taught and hails from Ethiopia, is currently developing a solution that many developers consider to be the premier authentication tool available.

Introducing Better Auth

Engida’s company, Better Auth, provides an open-source framework designed to streamline the process of user authentication management for developers.

The project has garnered significant interest from prominent investors, recently securing approximately $5 million in seed funding.

Investors include Peak XV (previously Sequoia India and Southeast Asia), Y Combinator, P1 Ventures, and Chapter One.

Built in Ethiopia

Remarkably, Engida constructed the entire product while still residing in Ethiopia, prior to traveling to the United States.

Engida shared with TechCrunch that his programming journey began at the age of 18.

It was initiated after a friend was unable to assist him in creating an e-commerce search application, prompting him to undertake the project independently.

From Analytics to Authentication

He subsequently secured remote software development positions and ultimately developed a web analytics platform.

This platform enabled developers to monitor user activity on their websites.

However, throughout his professional experiences, Engida consistently encountered a recurring challenge: user authentication.

The Limitations of Existing Tools

Every application necessitates the management of user sign-in, sign-out, and password reset procedures.

Furthermore, administrators often require the ability to manage permissions and user roles.

Engida observed that current tools were either insufficiently flexible or overly restrictive.

Companies such as Auth0, Firebase, and NextAuth provide managed services, but these solutions involve storing user data externally, limiting customization options, and incurring substantial costs as usage scales.

The Need for Customization

“I specifically needed an organization feature, a common requirement for most SaaS applications, but it was unavailable from these providers,” Engida explained to TechCrunch.

“Consequently, I had to develop it independently, a process that took around two weeks.

This experience led me to believe there had to be a more efficient approach to resolving this issue.”

A New Framework Emerges

Engida then abandoned his previous project and began developing an authentication framework based on TypeScript.

This framework would allow developers direct access to user data through open-source libraries.

It would also natively support common permissions scenarios, such as teams and roles, and be designed for scalability through the use of plug-ins.

Simplicity and Efficiency

“The core concept was to enable the addition of advanced features with just a few lines of code,” Engida stated.

This approach aims to provide developers with a powerful yet streamlined authentication solution.

The Rise of Better Auth and its Appeal to Developers

Engida developed the initial iteration of what would become Better Auth over a period of six months, primarily working from his home in Ethiopia. Upon its release to GitHub in September 2024, the library rapidly gained recognition for its potential among developers.

The startup reports that Better Auth has since achieved over 150,000 weekly downloads, garnered more than 15,000 stars on GitHub, and fostered a community exceeding 6,000 members on Discord.

Core Functionality and Benefits

Better Auth offers a straightforward proposition: it empowers developers to implement authentication systems, ranging from basic flows to complex, enterprise-level setups, directly within their existing databases. This is achieved through embedding the functionality on the back end.

Unlike cloud-based authentication services, Better Auth is distributed as an open source library. This allows for direct integration into a developer’s codebase, ensuring all user data remains on-premise and within their control. This aspect is particularly attractive to organizations concerned about sharing sensitive user information with external parties.

Unexpected Adoption in the AI Sector

The library has also experienced significant uptake among nascent AI startups. These companies require the ability to construct customized authentication processes that seamlessly integrate with their unique APIs.

Secure token management and scalable solutions without incurring substantial costs are also critical needs for these businesses, and Better Auth effectively addresses them.

Arnav Sahu, a partner at Peak XV and former principal at Y Combinator, noted, “We initially learned about the product through several startups we collaborate with. Their authentication product has demonstrated remarkable adoption within the emerging generation of AI startups.”

Investment and Future Plans

Better Auth represents Peak XV’s inaugural direct investment in a founder originating from Africa.

Engida states that Better Auth, currently available for free, will prioritize enhancements to its fundamental features. A paid enterprise infrastructure, designed to integrate with its open source foundation, is also planned.

This approach will provide developers with the choice of self-hosting or utilizing Better Auth’s cloud-based add-ons as their requirements evolve.

Maintaining Community and Scaling

Engida is also focused on scaling the project while preserving its community-driven ethos. The roadmap includes the recruitment of a small team to assist with codebase maintenance, documentation expansion, and support for enterprise users.

Currently, Engida continues to be the primary contributor to the codebase.

Better Auth recently completed YC’s spring accelerator program, becoming the third Ethiopian startup to do so, following Avion, a drone-based digital health platform, and BeU Delivery, a food delivery service.

A Symbol of Possibility

“The significance of this project extends beyond its popularity; it represents a broader shift,” Engida explained. “Ethiopian founders are underrepresented in the realm of global product development, with many perceiving it as unattainable. The traction Better Auth has gained offers encouragement for others to pursue more ambitious endeavors.”