Sep
10
2020
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StackRox nabs $26.5M for a platform that secures containers in Kubernetes

Containers have become a ubiquitous cornerstone in how companies manage their data, a trend that has only accelerated in the last eight months with the larger shift to cloud services and more frequent remote working due to the coronavirus pandemic. Alongside that, startups building services to enable containers to be used better are also getting a boost.

StackRox, which develops Kubernetes-native security solutions, says that its business grew by 240% in the first half of this year, and on the back of that, it is announcing today that it has raised $26.5 million to expand its business into international markets and continue investing in its R&D.

The funding, which appears to be a Series C, has an impressive list of backers. It is being led by Menlo Ventures, with Highland Capital Partners, Hewlett-Packard Enterprise, Sequoia Capital and Redpoint Ventures also participating. Sequoia and Redpoint are previous investors, and the company has raised around $60 million to date.

HPE is a strategic backer in this round:

“At HPE, we are working with our customers to help them accelerate their digital transformations,” said Paul Glaser, VP, Hewlett Packard Enterprise, and head of Pathfinder. “Security is a critical priority as they look to modernize their applications with containers. We’re excited to invest in StackRox and see it as a great fit with our new software HPE Ezmeral to help HPE customers secure their Kubernetes environments across their full application life cycle. By directly integrating with Kubernetes, StackRox enables a level of simplicity and unification for DevOps and Security teams to apply the needed controls effectively.”

Kamal Shah, the CEO, said that StackRox is not disclosing its valuation, but he confirmed it has definitely gone up. For some context, according to PitchBook data, the company was valued at $145 million in its last funding round, a Series B in 2018. Its customers today include the likes of Priceline, Brex, Reddit, Zendesk and Splunk, as well as government and other enterprise customers, in a container security market that analysts project will be worth some $2.2 billion by 2024, up from $568 million last year.

StackRox got its start in 2014, when containers were starting to pick up momentum in the market. At the time, its focus was a little more fragmented, not unlike the container market itself — it provided solutions that could be used with Docker containers as well as others. Over time, Shah said that the company chose to hone its focus just on Kubernetes, originally developed by Google and open-sourced, and now essentially the de facto standard in containerisation.

“We made a bet on Kubernetes at a time when there were multiple orchestrators, including Mesosphere, Docker and others,” he said. “Over the last two years Kubernetes has won the war and become the default choice, the Linux of the cloud and the biggest open-source cloud application. We are all Kubernetes all the time because what we see in the market are that a majority of our customers are moving to it. It has over 35,000 contributors to the open-source project alone, it’s not just Red Hat (IBM) and Google.” Research from CNCF estimates that nearly 80% of organizations that it surveyed are running Kubernetes in production.

That is not all good news, however, with the interest underscoring a bigger need for Kubernetes-focused security solutions for enterprises that opt to use it.

Shah says that some of the typical pitfalls in container architecture arise when they are misconfigured, leading to breaches; as well as around how applications are monitored; how developers use open-source libraries; and how companies implement regulatory compliance. Other security vulnerabilities that have been highlighted by others include the use of insecure container images; how containers interact with each other; the use of containers that have been infected with rogue processes; and having containers not isolated properly from their hosts.

But, Shah noted, “Containers in Kubernetes are inherently more secure if you can deploy correctly.” And to that end that is where StackRox’s solutions attempt to help: The company has built a multi-purposes toolkit that provides developers and security engineers with risk visibility, threat detection, compliance tools, segmentation tools and more. “Kubernetes was built for scale and flexibility, but it has lots of controls, so if you misconfigure it, it can lead to breaches. So you need a security solution to make sure you configure it all correctly,” said Shah.

He added that there has been a definite shift over the years from companies considering security solutions as an optional element into one that forms part of the consideration at the very core of the IT budget — another reason why StackRox and competitors like TwistLock (acquired by Palo Alto Networks) and Aqua Security have all seen their businesses really grow.

“We’ve seen the innovation companies are enabling by building applications in containers and Kubernetes. The need to protect those applications, at the scale and pace of DevOps, is crucial to realizing the business benefits of that innovation,” said Venky Ganesan, partner, Menlo Ventures, in a statement. “While lots of companies have focused on securing the container, only StackRox saw the need to focus on Kubernetes as the control plane for security as well as infrastructure. We’re thrilled to help fuel the company’s growth as it dominates this dynamic market.”

“Kubernetes represents one of the most important paradigm shifts in the world of enterprise software in years,” said Corey Mulloy, general partner, Highland Capital Partners, in a statement. “StackRox sits at the forefront of Kubernetes security, and as enterprises continue their shift to the cloud, Kubernetes is the ubiquitous platform that Linux was for the Internet era. In enabling Kubernetes-native security, StackRox has become the security platform of choice for these cloud-native app dev environments.”

May
20
2020
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FireHydrant lands $8M Series A for disaster management tool

When I spoke to Robert Ross, CEO and co-founder at FireHydrant, we had a technology adventure. First the audio wasn’t working correctly on Zoom, then Google Meet. Finally we used cell phones to complete the interview. It was like a case study in what FireHydrant is designed to do — help companies manage incidents and recover more quickly when things go wrong with their services.

Today the company announced an $8 million Series A from Menlo Ventures and Work-Bench. That brings the total raised to $9.5 million, including the $1.5 million seed round we reported on last April.

In the middle of a pandemic with certain services under unheard of pressure, understanding what to do when your systems crash has become increasingly important. FireHydrant has literally developed a playbook to help companies recover faster.

These run books are digital documents that are unique to each company and include what to do to help manage the recovery process. Some of that is administrative. For example, certain people have to be notified by email, a Jira ticket has to be generated and a Slack channel opened to provide a communications conduit for the team.

While Ross says you can’t define the exact recovery process itself because each incident tends to be unique, you can set up an organized response to an incident and that can help you get to work on the recovery much more quickly. That ability to manage an incident can be a difference maker when it comes to getting your system back to a steady state.

Ross is a former site reliability engineer (SRE) himself. He has experienced the kinds of problems his company is trying to solve, and that background was something that attracted investor Matt Murphy from Menlo Ventures.

“I love his authentic perspective, as a former SRE, on the problem and how to create something that would make the SRE function and processes better for all. That value prop really resonated with us in a time when the shift to online is accelerating and remote coordination between people tasked with identifying and fixing problems is at all time high in terms of its importance. Ultimately we’re headed toward more and more automation in problem resolution and FH helps pave the way,” Murphy told TechCrunch.

It’s not easy being an early-stage company in the current climate, but Ross believes his company has created something that will resonate, perhaps even more right now. As he says, every company has incidents, and how you react can define you as a company. Having tooling to help you manage that process helps give you structure at a time you need it most.

May
07
2020
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VC’s largest funds make big bets on vertical B2B marketplaces

During the waning days of the first dot-com boom, some of the biggest names in venture capital invested in marketplaces and directories whose sole function was to consolidate information and foster transparency in industries that had remained opaque for decades.

The thesis was that thousands of small businesses were making specialized products consumed by larger businesses in huge industries, but the reach of smaller players was limited by their dependence on a sales structure built on conferences and personal interactions.

Companies making pharmaceuticals, chemicals, construction materials and medical supplies represented trillions in sales, but those huge aggregate numbers hide how fragmented these supply chains are — and how difficult it is for buyers to see the breadth of sellers available.

Now, similar to the way business models popularized by Kozmo.com and Webvan in decades past have since been reincarnated as Postmates and DoorDash, the B2B directory and marketplace rises from the investment graveyard.

The first sign of life for the directory model came with the success of GoodRX back in 2011. The company proved that when information about pricing in a previously opaque industry becomes available, it can unleash a torrent of new demand.

Apr
08
2019
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Fleetsmith lands $30M Series B to grow Apple device management platform

Fleetsmith launched in 2016 with a mission to manage Apple devices in the cloud. It simplified an IT activity that had previously been complex, with help from Apple’s Device Enrollment Program. Over the last year, the startup has beefed up its offering considerably, and today it announced a $30 million Series B round led by Menlo Ventures.

Tiger Global Management, Upfront Ventures and Harrison Metal also participated. Under the terms of the deal, Naomi Pilosof Ionita, a partner at Menlo, will join the company board. Her colleague Matt Murphy will become a board observer. With today’s announcement, the startup has now raised more than $40 million, according to data supplied by the company.

Company co-founder and CEO Zack Blum says the original mission was about solving a pain point he and his co-founders were feeling around finding a modern approach to managing Apple devices. “From a customer perspective, they can ship devices directly to their employees. The employee unwraps it, connects to Wi-Fi and the device is enrolled automatically in Fleetsmith,” Blum explained.

He says that this automated approach, combined with the product’s security and intelligence capabilities, means that IT doesn’t have to worry about devices being registered and up-to-date, regardless of where an employee happens to be in the world.

It has moved from solving that problem for SMBs to having a broader mission for companies of all sizes, especially those with distributed work forces, which can benefit from enrolling in this automated fashion from anywhere. Once enrolled, companies can push security updates to all of the company’s employees and force updates if desired (or at least send strong reminders to avoid updating in the middle of a client meeting).

Over the last year, the company developed a dashboard for IT to monitor all of the devices under its management, including providing an overall health score with any potential problems it has found. For example, there may be a number of MacBook Pros without disk encryption enabled.

The dashboard ties into the identity management component of Office 365 and G Suite. IT can import the employee directory into the dashboard from either tool, and employees can sign into Fleetsmith with either set of credentials, providing a quick way to manage all employees in an organization.

Screenshot: Fleetsmith

Fleetsmith has also set up a partner program with Managed Service Providers (MSPs) to expand its reach further. MSPs manage IT for SMBs, and building a relationship with these types of companies can help it expand much more quickly.

The approach seems to be working, as the company has 30 employees and 1,500 customers. With the new cash in pocket, it intends to hire more people and continue building out the product’s capabilities, while expanding beyond the U.S. to markets overseas.

Jan
17
2019
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On-demand workspace platform Breather taps new CEO

Breather’s new CEO Bryan Murphy / Breather Press Kit

Breather, the platform that provides on-demand private workspace, announced today that it has appointed Bryan Murphy as its new CEO.

Before joining Breather, Murphy was the founder and president of direct-to-consumer mattress startup, Tomorrow Sleep. Prior to Tomorrow Sleep, Murphy held posts as an advisor to investment firms and as an executive at eBay after the company acquired his previous company, WHI Solutions — an e-commerce platform for aftermarket auto parts — where Murphy was the co-founder and CEO.

Breather believes Murphy’s extensive background scaling e-commerce and SaaS platforms, as well as his experience working with incumbents across a number of traditional industries, can help it execute through its next stage of global growth.

Murphy is filling the vacancy left by co-founder and former CEO Julien Smith, who stepped down as chief executive this past September, just three months after the company completed its $45 million Series C round, which was led by Menlo Ventures and saw participation from RRE Ventures, Temasek Holdings, Ascendas-Singbridge and Caisse de Depot et Placement du Quebec.

In a past statement on his transition, Smith said: “As I reflect on my strengths and consider what it will take for the company to reach its full potential, I realize bringing on an executive with experience scaling a company through the next level of growth is the best thing for the business.”

Smith, who remains with the company as chairman of the board, believes Murphy more than fits the bill. “Bryan’s record of scaling brands in competitive markets makes him an ideal leader to support this momentum, and I’m excited to see where he takes us next,” Smith said.

In a conversation with TechCrunch, Murphy explained that Breather’s next growth phase will ultimately come down to its ability to continue the global expansion of its network of locations and partner landlords while striking the optimal balance between rental economics and employee utility, productivity and performance. With new spaces and ramped marketing efforts, Murphy and the company expect 2019 to be a big year for Breather — “I think this year, you’re going to start hearing a lot about Breather and it really being in a leadership role for the industry.”

Breather’s workspace at 900 Broadway in New York City is one of 500+ network locations accessible to users.

On Breather’s platform, users are currently able to access a network of more than 500 private workspaces across 10 major cities around the world, which can be booked as meeting space or short-term private office space.

Meeting spaces can be reserved for as little as two hours, while office space can be booked on a month-to-month basis, providing businesses with financial flexibility, private and more spacious alternatives to co-working options, and the ability to easily change offices as they grow. For landlords, Breather allows property owners to generate value from underutilized space by providing a turnkey digital booking system, as well as expertise in the short-term rental space.

Murphy explained to TechCrunch that part of what excited him most about his new role was his belief in Breather’s significant product-market fit and the immense addressable market that he sees for flexible workspaces longer-term. With limited penetration to date, Murphy feels the commercial office space industry is in just the third inning of significant transformation. 

Murphy believes that long-term growth for Breather and other flexible space providers will be driven by a heightened focus on employee flexibility and wellness, a growing number of currently underserved companies whose needs fall between co-working and traditional direct leasing, and the need for landlords to support a wider variety of office space options as workforce demographics and behaviors shift. 

Murphy believes that the ease, flexibility and unlocked value Breather provides puts the platform in a great position to win market share.

“Breather has built a remarkable commercial real estate e-commerce and services platform that offers one-click access to over 500 workspaces around the world,” said Murphy in a press release. “To our customers, having access to workspace that is turnkey, affordable, beautiful, productive and that can flex up and down based on needs is a total game changer.”

To date, Breather has served more than 500,000 customers and has raised more than $120 million in investment.

Jan
24
2017
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Why the $3.7 billion AppDynamics acquisition happened right before IPO

appdynamics Applications management company AppDynamics was just wrapping up the final touches on its initial public offering when it learned that Cisco was interested in discussing a potential deal. Preliminary talks were abandoned in November, but the discussion just picked up again last week. The deal was announced today and the IPO was slated to price tomorrow. Although many companies seek… Read More

Jul
06
2016
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Veriflow raised $8.2 million to help IT pros avoid network outages and breaches

generic_code_hack_security Remember when Target lost millions of customer credit card numbers to hackers who got in to their networks, of all things, through the company’s connected HVAC systems? A startup called Veriflow Systems Inc. just raised $8.2 million in a Series A round of venture funding to prevent that kind of thing with technology it’s calling “mathematical network verification.”… Read More

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