Claroty announced on Thursday that it had secured “the largest investment ever made within the industrial cybersecurity sector,” with its Series D financial round of US$140 million, taking the company’s total funding to $235 million.
With the new funds, Claroty will expand into new verticals and regions, while working towards enhancing its product portfolio. The New York-headquartered company will use the funds to meet rapidly accelerating global demand for its Claroty Platform’s visibility, threat detection, risk and vulnerability management, and secure remote access capabilities by expanding into new verticals and regions, growing global headcount, bolstering its commitment to securing IoT devices, and further empowering customers’ journey to the cloud.
“Our mission is to drive visibility, continuity, and resiliency in the industrial economy by delivering the most comprehensive solutions that secure all connected devices within the four walls of an industrial site, including all operational technology (OT), Internet of Things (IoT), and industrial IoT (IIoT) assets,” Yaniv Vardi, CEO of Claroty, said in a press statement. “With this new investment from the most prestigious firms in the world, we have the financial runway to execute on our proven product strategy in a hyper-growth market, with a world-class leadership team and a strong ecosystem of partners to take us there.”
The latest funding round in the industrial cybersecurity sector comes at a time when Claroty expects 133 percent year-over-year (YoY) growth in new annual recurring revenue from the first half of 2020 to the first half of 2021. It also expects 110 percent YoY new logo growth and 100 percent customer retention, which, among others, include James Hardie, Coca-Cola EuroPacific Partners (Australia, Pacific, Indonesia), and IRPC Public Company Limited.
Claroty hired 80 new employees in the Americas, EMEA, and APAC in 2021, and is on track to grow headcount by nearly 50 percent by the end of this year. It expanded partner coverage by 50 percent in 2020 with the addition of Deloitte, KPMG, PwC, CrowdStrike, Atos, Yokogawa, and others to its new FOCUS Partner Program.
Claroty’s latest round of funding also comes at a time when the industrial cybersecurity space is being affected by numerous cybersecurity and ransomware attacks. There has been a clear and distinct shift since 2020 in the frequency and impact of cyber attacks against organizations that underpin critical infrastructure and supply chains.
According to Cybersecurity Ventures, global ransomware damage costs are predicted to exceed $265 billion by 2031, up from $20 billion in 2021. As these incidents show no signs of slowing, Claroty’s new investment puts the company at the forefront of the market with the resources, experience, and capabilities needed to shore up industrial cyber defenses for the future.
With over 120 industrial control system (ICS) vulnerability disclosures to date, the Claroty Research Team leads the ICS threat research industry by far, helping Claroty’s partners to deliver more secure products. In February, Claroty revealed a 25 percent rise for the second half of 2020 in ICS vulnerabilities compared to 2019, with over 70 percent of flaws remotely exploitable through network attack vectors. In its second ‘Biannual ICS Risk & Vulnerability Report,’ The company also recorded a 33 percent rise in ICS loopholes from the first half of last year.
Claroty’s latest funding round in the industrial cybersecurity sector was co-led by Bessemer Venture Partners’ Century II fund, designed for growth-stage market leading companies that will define the next century, and 40 North, the related investment arm of privately-held global industrial company Standard Industries.
Additional strategic investors include technology and manufacturing company LG, and I Squared Capital’s ISQ Global InfraTech Fund. All previous investors in the company have also participated.
Last week, Claroty released Claroty Edge, its patent-pending addition to the Claroty Platform and zero-infrastructure industrial cybersecurity solution. The Claroty Edge will function as a highly flexible edge-data collector to deliver complete visibility into industrial networks without requiring network changes, utilizing sensors, or having any physical footprint.