May
13
2020
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Startups are transforming global trade in the COVID-19 era

Global trade watchers breathed a sigh of relief on January 15, 2020.

After two years of threats, tariffs and tweets, there was finally a truce in the trade war between the U.S. and China. The agreement signed by President Trump and Chinese Vice Premier Liu He in the Oval Office didn’t resolve all trade tensions and maintained most of the $360 billion in tariffs the administration had put on Chinese goods. But for the first time in months, it looked like manufacturers, importers and shippers could start to put two difficult years behind them.

Then came COVID-19, at first a local disruption in Wuhan, China. Then it spread throughout Hubei province, causing havoc in a concentric circle that eventually engulfed the rest of China, where industrial production fell by more than 13.5% in the first two months of the year. When the virus spread everywhere, chaos ensued: Factories shuttered. Borders closed. Supply chains crumbled.

“It has had a cascading effect through the entire world’s economy,” says Anja Manuel, co-founder and managing partner of Rice, Hadley, Gates & Manuel LLC, an international strategic consulting firm based in Silicon Valley.

The crisis has caused a drastic contraction in global trade; the World Trade Organization estimates trade volumes will fall 13-20% in 2020. And spinning activity back up could be tricky: Even as China starts to get back online, the slowdown there could reduce worldwide exports by $50 billion this year. When factories do reopen, there’s no guarantee whether they will have parts available or empty warehouses, says Manuel, who also serves on the advisory board of Flexport, a shipping logistics startup. “Our supply chains are so tightly-knit and so just-in-time that throw a few wrenches in it like we’ve just done, and it’s going to be really hard to stand it back up again. The idea that we go back to normal the moment we lift restrictions is unlikely, fanciful, even.”

Getting to that new normal, though, is a job that a number of logistics startups are embracing. Already on the rise, companies like Flexport, Haven and Factiv see a global trade crisis as a setback, but also an opportunity to demonstrate the value of their digital platforms in a very much analog industry.

Apr
16
2020
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Verizon is buying B2B videoconferencing firm BlueJeans

US carrier Verizon* has splashed out to buy veteran B2B videoconferencing platform, BlueJeans Network — shelling out less than $500 million on the acquisition, according to the Wall Street Journal which first reported the news.

A Verizon spokeswoman confirmed to TechCrunch that the price-tag is sub-$500M but did not provide a more exact figure. Videoconferencing platform Blue Jeans has raised ~$175M since being founded around a decade ago, per Crunchbase, with US investor NEA leading a Series E round back in 2015.

In a press release announcing the deal, Verizon said it has entered into a definitive agreement to acquire the enterprise-grade videoconferencing and event platform in order to expand its “immersive unified communications portfolio”.

“Customers will benefit from a BlueJeans enterprise-grade video experience on Verizon’s high-performance global networks. In addition, the platform will be deeply integrated into Verizon’s 5G product roadmap, providing secure and real-time engagement solutions for high growth areas such as telemedicine, distance learning and field service work,” it wrote.

“As the way we work continues to change, it is absolutely critical for businesses and public sector customers to have access to a comprehensive suite of offerings that are enterprise ready, secure, frictionless and that integrate with existing tools,” added Tami Erwin, CEO of Verizon Business, in a supporting statement. “Collaboration and communications have become top of the agenda for businesses of all sizes and in all sectors in recent months. We are excited to combine the power of BlueJeans’ video platform with Verizon Business’ connectivity networks, platforms and solutions to meet our customers’ needs.”

The acquisition comes at a time when videoconferencing is seeing a massive uptick in usage as white collar workers around the world log on to meetings from home during the coronavirus pandemic.

Although it’s BlueJeans’ rival, Zoom, that’s been the most high profile name linked to the viral videoconferencing boom in recent weeks. The latter recently revealed that daily meeting participants on its platform jumped from a modest 10M in December to 200M in March.

However such booming growth and consumer usage has brought increased scrutiny for Zoom — leading to a spate of warnings (and even some bans), related to security and privacy concerns. And earlier this month the company said it would freeze product dev to focus on the laundry list of issues that have surfaced as users have piled in and kicked its tires, taking a little of the shine off of surging growth. 

On the sheer usage front BlueJeans is certainly small fish in comparison to Zoom — having remained b2b focused. A BlueJeans spokeswoman told us it has more than $100M ARR and over 15,000 customers at this point. (Some notable users include Facebook and Disney.)

But it’s paying users that are likely of most interest to Verizon, hence talk of telemedicine, distance learning and field service work — areas ripe for coronavirus-accelerated digitization. Carriers generally, meanwhile, haven’t been able to translate increased usage during the pandemic into a revenue growth story — as a result of a combination of fixed costs, debt and market disruption that’s been hitting their shares during the coronavirus crisis, per Reuters. Bolting on more b2b tools looks to be one way of growing network revenues.

“The combination of BlueJeans’ world class enterprise video collaboration platform and trusted brand with Verizon Business’ next generation edge computing innovation will deliver highly differentiated and compelling solutions to our joint customers,” said Quentin Gallivan, BlueJeans CEO, in a statement. “We are very excited about joining the Verizon team and we truly believe the future of business communications starts today!”

Verizon said today that said BlueJeans founders and “key management” will join the company as part of the acquisition, with BlueJeans employees set to become Verizon employees immediately following the close of the deal — which is expected in the second quarter, pending customary closing conditions.

BlueJeans co-founder Krish Ramakrishnan has a history of exits, selling a couple of his previous startups to networking giant Cisco — where he has also worked, in between spinning out his own companies.

*Disclosure: Verizon is also TechCrunch’s parent company

Feb
28
2020
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Microsoft’s Cortana drops consumer skills as it refocuses on business users

With the next version of Windows 10, coming this spring, Microsoft’s Cortana digital assistant will lose a number of consumer skills around music and connected homes, as well as some third-party skills. That’s very much in line with Microsoft’s new focus for Cortana, but it may still come as a surprise to the dozens of loyal Cortana fans.

Microsoft is also turning off Cortana support in its Microsoft Launcher on Android by the end of April and on older versions of Windows that have reached their end-of-service date, which usually comes about 36 months after the original release.

cortana

As the company explained last year, it now mostly thinks of Cortana as a service for business users. The new Cortana is all about productivity, with deep integrations into Microsoft’s suite of Office tools, for example. In this context, consumer services are only a distraction, and Microsoft is leaving that market to the likes of Amazon and Google .

Because the new Cortana experience is all about Microsoft 365, the subscription service that includes access to the Office tools, email, online storage and more, it doesn’t come as a surprise that the assistant’s new feature will give you access to data from these tools, including your calendar, Microsoft To Do notes and more.

And while some consumer features are going away, Microsoft stresses that Cortana will still be able to tell you a joke, set alarms and timers, and give you answers from Bing.

For now, all of this only applies to English-speaking users in the U.S. Outside of the U.S., most of the productivity features will launch in the future.

Feb
28
2020
--

Microsoft’s Cortana drops consumer skills as it refocuses on business users

With the next version of Windows 10, coming this spring, Microsoft’s Cortana digital assistant will lose a number of consumer skills around music and connected homes, as well as some third-party skills. That’s very much in line with Microsoft’s new focus for Cortana, but it may still come as a surprise to the dozens of loyal Cortana fans.

Microsoft is also turning off Cortana support in its Microsoft Launcher on Android by the end of April and on older versions of Windows that have reached their end-of-service date, which usually comes about 36 months after the original release.

cortana

As the company explained last year, it now mostly thinks of Cortana as a service for business users. The new Cortana is all about productivity, with deep integrations into Microsoft’s suite of Office tools, for example. In this context, consumer services are only a distraction, and Microsoft is leaving that market to the likes of Amazon and Google .

Because the new Cortana experience is all about Microsoft 365, the subscription service that includes access to the Office tools, email, online storage and more, it doesn’t come as a surprise that the assistant’s new feature will give you access to data from these tools, including your calendar, Microsoft To Do notes and more.

And while some consumer features are going away, Microsoft stresses that Cortana will still be able to tell you a joke, set alarms and timers, and give you answers from Bing.

For now, all of this only applies to English-speaking users in the U.S. Outside of the U.S., most of the productivity features will launch in the future.

Dec
04
2019
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GitGuardian raises $12M to help developers write more secure code and ‘fix’ GitHub leaks

Data breaches that could cause millions of dollars in potential damages have been the bane of the life of many a company. What’s required is a great deal of real-time monitoring. The problem is that this world has become incredibly complex. A SANS Institute survey found half of company data breaches were the result of account or credential hacking.

GitGuardian has attempted to address this with a highly developer-centric cybersecurity solution.

It’s now attracted the attention of major investors, to the tune of $12 million in Series A funding, led by Balderton Capital . Scott Chacon, co-founder of GitHub, and Solomon Hykes, founder of Docker, also participated in the round.

The startup plans to use the investment from Balderton Capital to expand its customer base, predominantly in the U.S. Around 75% of its clients are currently based in the U.S., with the remainder being based in Europe, and the funding will continue to drive this expansion.

Built to uncover sensitive company information hiding in online repositories, GitGuardian says its real-time monitoring platform can address the data leaks issues. Modern enterprise software developers have to integrate multiple internal and third-party services. That means they need incredibly sensitive “secrets,” such as login details, API keys and private cryptographic keys used to protect confidential systems and data.

GitGuardian’s systems detect thousands of credential leaks per day. The team originally built its launch platform with public GitHub in mind; however, GitGuardian is built as a private solution to monitor and notify on secrets that are inappropriately disseminated in internal systems as well, such as private code repositories or messaging systems.

Solomon Hykes, founder of Docker and investor at GitGuardian, said: “Securing your systems starts with securing your software development process. GitGuardian understands this, and they have built a pragmatic solution to an acute security problem. Their credentials monitoring system is a must-have for any serious organization.”

Do they have any competitors?

Co-founder Jérémy Thomas told me: “We currently don’t have any direct competitors. This generally means that there’s no market, or the market is too small to be interesting. In our case, our fundraise proves we’ve put our hands on something huge. So the reason we don’t have competitors is because the problem we’re solving is counterintuitive at first sight. Ask any developer, they will say they would never hardcode any secret in public source code. However, humans make mistakes and when that happens, they can be extremely serious: it can take a single leaked credential to jeopardize an entire organization. To conclude, I’d say our real competitors so far are black hat hackers. Black hat activity is real on GitHub. For two years, we’ve been monitoring organized groups of hackers that exchange sensitive information they find on the platform. We are competing with them on speed of detection and scope of vulnerabilities covered.”

Nov
13
2019
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Messaging app Wire confirms $8.2M raise, responds to privacy concerns after moving holding company to the US

Big changes are afoot for Wire, an enterprise-focused end-to-end encrypted messaging app and service that advertises itself as “the most secure collaboration platform”. In February, Wire quietly raised $8.2 million from Morpheus Ventures and others, we’ve confirmed — the first funding amount it has ever disclosed — and alongside that external financing, it moved its holding company in the same month to the US from Luxembourg, a switch that Wire’s CEO Morten Brogger described in an interview as “simple and pragmatic.”

He also said that Wire is planning to introduce a freemium tier to its existing consumer service — which itself has half a million users — while working on a larger round of funding to fuel more growth of its enterprise business — a key reason for moving to the US, he added: There is more money to be raised there.

“We knew we needed this funding and additional to support continued growth. We made the decision that at some point in time it will be easier to get funding in North America, where there’s six times the amount of venture capital,” he said.

While Wire has moved its holding company to the US, it is keeping the rest of its operations as is. Customers are licensed and serviced from Wire Switzerland; the software development team is in Berlin, Germany; and hosting remains in Europe.

The news of Wire’s US move and the basics of its February funding — sans value, date or backers — came out this week via a blog post that raises questions about whether a company that trades on the idea of data privacy should itself be more transparent about its activities.

Specifically, the changes to Wire’s financing and legal structure were only communicated to users when news started to leak out, which brings up questions not just about transparency, but about the state of Wire’s privacy policy, given the company’s holding company now being on US soil.

It was an issue picked up and amplified by NSA whistleblower Edward Snowden . Via Twitter, he described the move to the US as “not appropriate for a company claiming to provide a secure messenger — claims a large number of human rights defenders relied on.”

“There was no change in control and [the move was] very tactical [because of fundraising],” Brogger said about the company’s decision not to communicate the move, adding that the company had never talked about funding in the past, either. “Our evaluation was that this was not necessary. Was it right or wrong? I don’t know.”

The other key question is whether Wire’s shift to the US puts users’ data at risk — a question that Brogger claims is straightforward to answer: “We are in Switzerland, which has the best privacy laws in the world” — it’s subject to Europe’s General Data Protection Regulation framework (GDPR) on top of its own local laws — “and Wire now belongs to a new group holding, but there no change in control.”

In its blog post published in the wake of blowback from privacy advocates, Wire also claims it “stands by its mission to best protect communication data with state-of-the-art technology and practice” — listing several items in its defence:

  • All source code has been and will be available for inspection on GitHub (github.com/wireapp).
  • All communication through Wire is secured with end-to-end encryption — messages, conference calls, files. The decryption keys are only stored on user devices, not on our servers. It also gives companies the option to deploy their own instances of Wire in their own data centers.
  • Wire has started working on a federated protocol to connect on-premise installations and make messaging and collaboration more ubiquitous.
  • Wire believes that data protection is best achieved through state-of-the-art encryption and continues to innovate in that space with Messaging Layer Security (MLS).

But where data privacy and US law are concerned, it’s complicated. Snowden famously leaked scores of classified documents disclosing the extent of US government mass surveillance programs in 2013, including how data-harvesting was embedded in US-based messaging and technology platforms.

Six years on, the political and legal ramifications of that disclosure are still playing out — with a key judgement pending from Europe’s top court which could yet unseat the current data transfer arrangement between the EU and the US.

Privacy versus security

Wire launched at a time when interest in messaging apps was at a high watermark. The company made its debut in the middle of February 2014, and it was only one week later that Facebook acquired WhatsApp for the princely sum of $19 billion.

We described Wire’s primary selling point at the time as a “reimagining of how a communications tool like Skype should operate had it been built today” rather than in in 2003. That meant encryption and privacy protection, but also better audio tools and file compression and more.

It was a pitch that seemed especially compelling considering the background of the company. Skype co-founder Janus Friis and funds connected to him were the startup’s first backers (and they remain the largest shareholders);Wire was co-founded in by Skype alums Jonathan Christensen and Alan Duric (former no longer with the company, latter is its CTO); and even new investor Morpheus has Skype roots.

Yet even with that Skype pedigree, the strategy faced a big challenge.

“The consumer messaging market is lost to the Facebooks of the world, which dominate it,” Brogger said today. “However, we made a clear insight, which is the core strength of Wire: security and privacy.”

That, combined with trend around the consumerization of IT that’s brought new tools to business users, is what led Wire to the enterprise market in 2017 — a shift that’s seen it pick up a number of big names among its 700 enterprise customers, including Fortum, Aon, EY and SoftBank Robotics.

But fast forward to today, and it seems that even as security and privacy are two sides of the same coin, it may not be so simple when deciding what to optimise in terms of features and future development, which is part of the question now and what critics are concerned with.

“Wire was always for profit and planned to follow the typical venture backed route of raising rounds to accelerate growth,” one source familiar with the company told us. “However, it took time to find its niche (B2B, enterprise secure comms).

“It needed money to keep the operations going and growing. [But] the new CEO, who joined late 2017, didn’t really care about the free users, and the way I read it now, the transformation is complete: ‘If Wire works for you, fine, but we don’t really care about what you think about our ownership or funding structure as our corporate clients care about security, not about privacy.’”

And that is the message you get from Brogger, too, who describes individual consumers as “not part of our strategy”, but also not entirely removed from it, either, as the focus shifts to enterprises and their security needs.

Brogger said there are still half a million individuals on the platform, and they will come up with ways to continue to serve them under the same privacy policies and with the same kind of service as the enterprise users. “We want to give them all the same features with no limits,” he added. “We are looking to switch it into a freemium model.”

On the other side, “We are having a lot of inbound requests on how Wire can replace Skype for Business,” he said. “We are the only one who can do that with our level of security. It’s become a very interesting journey and we are super excited.”

Part of the company’s push into enterprise has also seen it make a number of hires. This has included bringing in two former Huddle C-suite execs, Brogger as CEO and Rasmus Holst as chief revenue officer — a bench that Wire expanded this week with three new hires from three other B2B businesses: a VP of EMEA sales from New Relic, a VP of finance from Contentful; and a VP of Americas sales from Xeebi.

Such growth comes with a price-tag attached to it, clearly. Which is why Wire is opening itself to more funding and more exposure in the US, but also more scrutiny and questions from those who counted on its services before the change.

Brogger said inbound interest has been strong and he expects the startup’s next round to close in the next two to three months.

Nov
06
2019
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Cyber-skills platform Immersive Labs raises $40M in North America expansion

Immersive Labs, a cybersecurity skills platform, has raised $40 million in its Series B, the company’s second round of funding this year following an $8 million Series A in January.

Summit Partners led the fundraise, with Goldman Sachs participating, the Bristol, U.K.-based company confirmed.

Immersive, led by former GCHQ cybersecurity instructor James Hadley, helps corporate employees learn new security skills by using real, up-to-date threat intelligence in a “gamified” way. Its cybersecurity learning platform uses a variety of techniques and psychology to build up immersive and engaging cyber war games to help IT and security teams learn. The platform aims to help users better understand cybersecurity threats, like detecting and understanding phishing and malware reverse-engineering.

It’s a new take on cybersecurity education, as the company’s founder and chief executive Hadley said the ever-evolving threat landscape has made traditional classroom training “obsolete.”

“It creates knowledge gaps that increase risk, offer vulnerabilities and present opportunities for attackers,” said Hadley.

The company said it will use the round to expand further into the U.S. and Canadian markets from its North American headquarters in Boston, Mass.

Since its founding in 2017, Immersive already has big customers to its name, including Bank of Montreal and Citigroup, on top of its U.K. customers, including BT, the National Health Service and London’s Metropolitan Police.

Goldman Sachs, an investor and customer, said it was “impressed” by Immersive’s achievements so far.

“The platform is continually evolving as new features are developed to help address the gap in cyber skills that is impacting companies and governments across the globe,” said James Hayward, the bank’s executive director.

Immersive said it has 750% year-over-year growth in annual recurring revenues and more than 100 employees across its offices.

Oct
30
2019
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Samsung ramps up its B2B partner and developer efforts

Chances are you mostly think of Samsung as a consumer-focused electronics company, but it actually has a very sizable B2B business as well, which serves more than 15,000 large enterprises and hundreds of thousands of SMB entrepreneurs via its partners. At its developer conference this week, it’s putting the spotlight squarely on this side of its business — with a related hardware launch as well. The focus of today’s news, however, is on Knox, Samsung’s mobile security platform, and Project AppStack, which will likely get a different name soon, and which provides B2B customers with a new mechanism to deliver SaaS tools and native apps to their employees’ devices, as well as new tools for developers that make these services more discoverable.

At least in the U.S., Samsung hasn’t really marketed its B2B business all that much. With this event, the company is clearly thinking to change that.

At its core, Samsung is, of course, a hardware company, and as Taher Behbehani, the head of its U.S. mobile B2B division, told me, Samsung’s tablet sales actually doubled in the last year, and most of these were for industrial deployments and business-specific solutions. To better serve this market, the company today announced that it is bringing the rugged Tab Active Pro to the U.S. market. Previously, it was only available in Europe.

The Active Pro, with its 10.1″ display, supports Samsung’s S Pen, as well as Dex for using it on the desktop. It’s got all of the dust and water-resistance you would expect from a rugged device, is rated to easily support drops from about four feet high and promises up to 15 hours of battery life. It also features LTE connectivity and has an NFC reader on the back to allow you to badge into a secure application or take contactless payments (which are quite popular in most of the world but are only very slowly becoming a thing in the U.S.), as well as a programmable button to allow business users and frontline workers to open any application they select (like a barcode scanner).

“The traditional rugged devices out there are relatively expensive, relatively heavy to carry around for a full shift,” Samsung’s Chris Briglin told me. “Samsung is growing that market by serving users that traditionally haven’t been able to afford rugged devices or have had to share them between up to four co-workers.”

Today’s event is less about hardware than software and partnerships, though. At the core of the announcements is the new Knox Partner Program, a new way for partners to create and sell applications on Samsung devices. “We work with about 100,000 developers,” said Behbehani. “Some of these developers are inside companies. Some are outside independent developers and ISVs. And what we hear from these developer communities is when they have a solution or an app, how do I get that to a customer? How do I distribute it more effectively?”

This new partner program is Samsung’s solution for that. It’s a three-tier partner program that’s an evolution of the existing Samsung Enterprise Alliance program. At the most basic level, partners get access to support and marketing assets. At all tiers, partners can also get Knox validation for their applications to highlight that they properly implement all of the Knox APIs.

The free Bronze tier includes access to Knox SDKs and APIs, as well as licensing keys. At the Silver level, partners will get support in their region, while Gold-level members get access to the Samsung Solutions Catalog, as well as the ability to be included in the internal catalog used by Samsung sales teams globally. “This is to enable Samsung teams to find the right solutions to meet customer needs, and promote these solutions to its customers,” the company writes in today’s announcement. Gold-level partners also get access to test devices.

The other new service that will enable developers to reach more enterprises and SMBs is Project AppStack.

“When a new customer buys a Samsung device, no matter if it’s an SMB or an enterprise, depending on the information they provide to us, they get to search for and they get to select a number of different applications specifically designed to help them in their own vertical and for the size of the business,” explained Behbehani. “And once the phone is activated, these apps are downloaded through the ISV or the SaaS player through the back-end delivery mechanism which we are developing.”

For large enterprises, Samsung also runs an algorithm that looks at the size of the business and the vertical it is in to recommend specific applications, too.

Samsung will run a series of hackathons over the course of the next few months to figure out exactly how developers and its customers want to use this service. “It’s a module. It’s a technology backend. It has different components to it,” said Behbehani. “We have a number of tools already in place we have to fine- tune others and we also, to be honest, want to make sure that we come up with a POC in the marketplace that accurately reflects the requirements and the creativity of what the demand is in the marketplace.”

Oct
16
2019
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Autify raises $2.5M seed round for its no-code software testing platform

Autify, a platform that makes testing web application as easy as clicking a few buttons, has raised a $2.5 million seed round from Global Brain, Salesforce Ventures, Archetype Ventures and several angels. The company, which recently graduated from the Alchemist accelerator program for enterprise startups, splits its base between the U.S., where it keeps an office, and Japan, where co-founders Ryo Chikazawa (CEO) and Sam Yamashita got their start as software engineers.

The main idea here is that Autify, which was founded in 2016, allows teams to write tests by simply recording their interactions with the app with the help of a Chrome extension, then having Autify run these tests automatically on a variety of other browsers and mobile devices. Typically, these kinds of tests are very brittle and quickly start to fail whenever a developer makes changes to the design of the application.

Autify gets around this by using some machine learning smarts that give it the ability to know that a given button or form is still the same, no matter where it is on the page. Users can currently test their applications using IE, Edge, Chrome and Firefox on macOS and Windows, as well as a range of iOS and Android devices.

Scenario Editor

Chikazawa tells me that the main idea of Autify is based on his own experience as a developer. He also noted that many enterprises are struggling to hire automation engineers who can write tests for them, using Selenium and similar frameworks. With Autify, any developer (and even non-developer) can create a test without having to know the specifics of the underlying testing framework. “You don’t really need technical knowledge,” explained Chikazawa. “You can just out of the box use Autify.”

There are obviously some other startups that are also tackling this space, including SpotQA, for example. Chikazawa, however, argues that Autify is different, given its focus on enterprises. “The audience is really different. We have competitors that are targeting engineers, but because we are saying that no coding [is required], we are selling to the companies that have been struggling with hiring automating engineers,” he told me. He also stressed that Autify is able to do cross-browser testing, something that’s also not a given among its competitors.

The company introduced its closed beta version in March and is currently testing the service with about a hundred companies. It integrates with development platforms like TestRail, Jenkins and CircleCI, as well as Slack.

Screen Shot 2019 10 01 at 2.04.24 AM

Sep
25
2019
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Arceo.ai raises $37 million to expand cyber insurance coverage and access

Critical cyber attacks on both businesses and individuals have been grabbing headlines at an alarming rate. Cybersecurity has moved from a background risk for enterprises to a critical day-to-day threat to business operations, forcing executive teams to pour time and hundreds of billions in capital into monitoring and prevention efforts.

Yet even as investment in security ticks up, the frequency and cost of cybercrime to businesses continues to rapidly accelerate, with the World Economic Forum estimating the economic loss due to cybercrime could reach $3 trillion by 2020.

More companies are now turning to cyber insurance as a means of mitigating financial exposure. However, for traditional insurers, cybersecurity remains a relatively nascent and unfamiliar issue, requiring risk-assessment data points and methodologies largely different from those seen in traditional insurance products. As a result, businesses often struggle to get the scale of cybersecurity coverage they require.

Arceo.ai is hoping to expand the size and scope of the cyber insurance market for both insurers and companies, by providing insurers with effective real-time data, analytics and context, necessary for safely and efficiently underwrite cyber risk.

This morning, Arceo took a major step in achieving that goal, announcing the company has raised a $37 million round of funding led by Lightspeed Venture Partners and Founders Fund with participation from CRV and  UL Ventures.

Arceo logoUsing an expansive set of global sources across a customer’s digital footprint, Arceo.AI collects internal, external and macro cyber risk data which it uses to evaluate a company’s security and cyber risk management behavior. By automating the data collection process and connecting it with insurer underwriting processes, Arceo is able to keep its data and policy assessments up to date in real-time and enable faster, more efficient quotes.

A vital component of Arceo’s platform is its analytics offering. Using patented data science and cyber risk models, Arceo generates analytics-driven insights for insurance carriers, brokers and end-insured customers. For end-insured customers, Arceo helps companies understand whether they’re using the best mitigation strategies by providing policy recommendations and industry benchmarking to help contextualize day-to-day cyber behavior and hygiene. For underwriters, Arceo can provide specific insurance recommendations based on particular policy coverages.

Ultimately, Arceo looks to provide both insurers and the insured with actionable answers to key questions such as how one assesses cyber risk, how one determines what risks can be mitigated with technology alone, how one knows which systems are best and whether those systems are being used appropriately.

Raj Shah

Arceo.ai Chairman Raj Shah. Image via Arceo.ai

In an interview with TechCrunch, Arceo Chairman Raj Shah explained that the company’s background expertise, proprietary data systems, and deep pedigree in both the security and insurance truly differentiate Arceo from competing solutions. For starters, both Shah and Arceo co-founder and CEO Vishaal Hariprasad have spent close to the entirety of their careers in national security and cybersecurity. Hariprasad started his career in the Airforce’s first cohort of cyber warfare officers, before teaming up with Shah to start Morta Security in 2012, a security startup the two sold to Palo Alto networks in just roughly two years.

After selling the company, Shah and Hariprasad remained in the security world before realizing that there was a natural intersection between security and insurance, and a real opportunity for risk transfer solutions.

“Having studied the market, we saw that people are spending more and more dollars on cybersecurity products… There are hundreds of thousands of new vendors every year… Spend is going up, but we don’t feel any safer!” Shah told TechCrunch.

“That’s when we said ‘Hey, we need to move beyond just thinking about technology points and products, and think about holistic cyber risk management.’ And this is where insurance has historically done a great job. Putting a price on behavior and making people think and letting them take risks… From life and death and health to buyers and property and casualty. And so cyber is that next class risk… So that’s really why we started the business. We wanted to provide a real way to manage the cyber stress that they’re facing and that will impact every single one of our digital lives.”

Since the company’s founding, Raj and Vishaal have been joined by a deep network of cyber and insurance experts. Today, Arceo also announced that Hemant Shah, founder and former CEO of catastrophe risk modeling company RMS has joined Arceo’s Board of Directors. Additionally, earlier this month, the company announced that Mario Vitale, the former CEO of publically-traded insurance companies Willis Towers Watson and Zurich Insurance Group, would be joining the Arceo team as the company’s President.

The company noted that participation from high-profile industry vets like Hemant and Mario not only further advance Arceo’s competitive advantage but also acts as another major validation of the company’s future and work to date.

According to Arceo Chairman Raj Shah, after years of investing in R&D, the latest funds will be used towards expansion efforts and scaling Arceo to the broader ecosystem of insurance and brokers. Longer-term, the company hopes to offer the most complete combined cybersecurity and risk transfer solution to insurers and the insured, easing the stress around cyber threats for both enterprises and individuals and ultimately improving broader cyber resiliency.

If you’d like to hear more from Arceo’s Raj Shah, Raj will also be joining us this year on the Extra Crunch stage at TechCrunch Disrupt SF, where he’ll discuss how founders and companies should think about potential US government investment. Grab tickets here and we hope to see you there!

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