- Cloud security company Netskope just raised a $340 million Series G funding round led by Sequoia Capital.
- The round values the company at $3 billion — more than double its last valuation, as of November 2018.
- Netskope CEO and founder Sanjay Beri said that the company is seeing rapid growth, and wasn’t necessarily looking to raise funding, but inbound interest from Sequoia Capital was too good to pass up.
- “We’ve been scaling extremely rapidly, we saw 80% growth year on year in our customer base…worldwide expansion has sort of been the focus for us, along with product expansion,” Beri said.
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With more and more companies moving to the cloud, the need for tools to help make sure employees’ access to the cloud is secure is increasing, and cloud security startups like Netskope are reaping the rewards.
Last week, Netskope announced that it had raised a Series G funding round of $340 million led by legendary Silicon Valley venture firm Sequoia Capital.
The new funding values the security company at $3 billion — more than double its last private valuation of $1.39 billion when it last raised in late 2018. New investors Canada Pension Plan Investment Board and PSP Investments also participated in the round, along with existing investors like Lightspeed Venture Partners and Accel.
Netskope helps companies monitor and secure how their employees are using cloud software such as Google Drive, Dropbox, and Slack. Netskope’s software analyzes employee activity and notes when there’s something suspicious going on, helping the IT department respond to incidents.
Sanjay Beri, Netskope CEO and founder, said the company was already growing rapidly and not necessarily looking to raise a new funding round, but had so much interest from investors that it decided that the time was right.
In fact, Beri said, Sequoia Capital was the one who first approached him about the funding. He said the chance to partner with Sequoia — famed for its early investments in legends like Electronic Arts, Cisco, and even Instagram — was too good an opportunity to pass up.
“They’ve backed some of the transformational security companies of the past decade,” Beri told Business Insider, adding that the firm has also invested in many of the top publicly-traded companies. Sequoia has previously invested in security companies like Okta, Symantec, and Carbon Black (which was recently acquired by VMware for $2.1 billion).
Continuing the rapid growth
Beri said the funds will be used to continue the company’s rapid growth and invest in research and development. The goal is to make its security tools even better.
“We’ve been scaling extremely rapidly, we saw 80% growth year on year in our customer base…worldwide expansion has sort of been the focus for us, along with product expansion,” Beri said.
The reason the company is growing so rapidly Beri said, is because most older, legacy security companies aren’t looking to solve these new security issues companies have.
As part of the R&D the company will be focusing on this year, Netskope will be looking to add more artificial intelligence and machine learning to its products. Beri says that Netskope wants to invest further in its capabilities around using AI to help companies detect and respond to cyber threats.
Another area Beri wants Netskope to focus on is sales expansion in order to get more customers, particularly overseas. Over the last year the company has expanded in many countries overseas, including Australia, Singapore, Chile, Brazil, and Germany.
When Beri started Netskope in 2012, he wanted to build new, modern security tools to help companies as they undertook a digital transformation and moved to the cloud. Part of that was understanding the the role data plays in that transition. And the goal remains the same today, he says.
“As people digitally transform, they will transform how they think about their security, it isn’t boxes in your office, it will be a cloud edge…so we’ve stayed true to that vision,” Beri said. As the company continues to grow, Beri wants to keep building tools that will be helpful for companies in the process of moving to the cloud.
Netskope declined to give specific customer figures but said its customer base now includes 25 percent of the Fortune 100, including companies like Apria Healthcare, Stroock, and Sainsbury’s.
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