Coralogix, an AI powered log management platform, recently announced $25 million in new funding. Coralogix’s platform automatically clusters log records to identify patterns and baseline normal activity for a network. Utilizing this baseline the AI algorithms can then spotlight anomalies for DevOps teams and through the platform’s suite of identification, visualization, and remediation tools helps maintain performance and security. This new funding brings the total amount of capital raised to $41.2M. Led by Red Dot Capital Partners, the new capital will be used to help Coralogix expand into foreign markets and augment their sales and marketing efforts.
Why this transaction?
The York IE team chose this as our transaction of the week to discuss the log management market and its continued growth. As cyberattacks continue to threaten the security of personal data more and more companies are beefing up their network solutions. The two main issues with many of the solutions on the market today are that they are not cloud-native and price. Coralogix is a cloud native SaaS solution that addresses the pricing issue by offering one of the most flexible pricing models on the market; allowing customers to pay based on data priority, rather than volume. The trend away from volume based pricing is evident with upstarts like Exabeam using a user-based pricing model, and the market leader, Splunk, moving to an instance based model.
The log management market is expected to reach $1.2 billion by 2022. Currently, the log management and SIEM (security use case for log management) space is full of industry leaders like Splunk, Elastic, Rapid7, Sumo Logic and many others, so it is interesting to see more entrants into the market. Other log management/SIEM startups to recently raise capital include Devo and Panther Labs. From the funding announcement, Coralogix seems to be betting on the AI built into their solution, as well as their pricing model to differentiate themselves in this crowded market. While there are already pricing model shifts occurring in the market, it will be interesting to see if some of the incumbents start implementing and advertising deeper use of AI.