Lacework raises $1.3 billion at an $8.3 billion valuation, making it the largest-ever round in cybersecurity history
With daily headlines of data breaches and new waves of security challenges, investors are pouring billions of dollars into promising cybersecurity startups. One of the leading startups in the cybersecurity space is Lacework, a provider of the data-driven security platform for the cloud. With its patented Polygraph technology, Lacework takes millions of incoming data points, correlates them into behaviors, detects all potential security events, and then helps customers focus on the critical security risks that need action.
Today, Lacework announced it has raised a whopping $1.3 billion in Series D growth funding at a valuation of $8.3 billion, making the San Jose, California-based cybersecurity startup a member of the highly coveted unicorn club.
The round, which is the largest-funding round in cybersecurity history, was led by existing investors Sutter Hill Ventures, Altimeter Capital, D1 Capital Partners, and Tiger Global Management with participation from new investors including Counterpoint Global (Morgan Stanley), Durable Capital, Franklin Templeton, General Catalyst, and XN. Coatue, Dragoneer, Liberty Global Ventures, and Snowflake Ventures, all existing investors, also participated.
Lacework will use the funding proceeds to continue to invest in rapidly scaling its business globally, building on the recent momentum of more than 3x year-over-year revenue growth, a 3.5x year-over-year increase in new customers, including LogicMonitor, Hypergiant, Sprinklr, and more than 3x year-over-year employee growth worldwide.
Founded in 2015 by Mike Speiser, Sanjay Kalra, and Vikram Kapoor, lacework enables organizations to uncover threats before they become problems. Lacework collects, analyzes, and accurately correlates data across an organization’s AWS, Azure, GCP, and Kubernetes environments, and then narrows it down to the handful of security events that matter. Customers all over the globe depend on Lacework to drive revenue, bring products to market faster and safer and consolidate point security solutions into a single platform.
Lacework will also use this funding to extend its lead in the cloud security market by fueling product innovation that expands the company’s total addressable market and pursuing additional strategic acquisitions, like the recently announced Soluble transaction.
The ecosystem surrounding Lacework, including IaC, CI/CD, and workflow integrations such as Kubernetes, Terraform, and Jira, strong and growing alliances with partners like Snowflake, New Relic, Amazon Web Services, Google Cloud Platform (GCP), Microsoft Azure and growing channel partnerships with companies including Presidio, EVOTEK, Guidepoint, GlobalDots, and Katana1 are continuing to drive outsized momentum. Today partners influence more than 60 percent of the company’s new business and are helping to scale go-to-market at an ever-increasing pace.
“Our growth over the last 36 months reflects the pain many businesses endure as they attempt to navigate the cloud using security products that simply aren’t designed for it. This investment, and the partnership of these long-term investors, will help us realize Lacework’s promise of becoming the most trusted cloud security platform,” said David Hatfield and Jay Parikh, Co-CEOs, Lacework.
“As organizations of all sizes continue building applications in the cloud, more critical data will be exposed and exploited. Lacework is building an impressive business by offering companies a transformative approach to securing their data in the cloud. That approach is already driving 3x year-over-year revenue growth, and we believe there is still substantial opportunity ahead. We’re excited to partner with Lacework as it pursues its strategy for long-term sustainable growth,” said Dennis Lynch, Head of Counterpoint Global (Morgan Stanley).
“Lacework’s judicious application of AI and ML to generate and surface the most critical events is what sets the platform apart,” said Bren Biggs, VP of DevOps and Cybersecurity at Lacework customer, Hypergiant.
“Business and technology leaders understand that security and governance are important issues, but they continue to struggle with solutions that can’t keep up with the enormous scale, IT complexity, evolving technologies and constantly changing hybrid cloud landscape. There is a growing need for organizations like Lacework that look at cloud security through a new lens and adapt data-driven technologies that enable security efficacy and delivery efficiency,” said Frank Dickson, IDC Program Vice President, Security & Trust.