Boston based, iBoss, recently announced a $145M growth round led by NightDragon and Francisco Partners. The cloud-native cybersecurity company has experienced rapid growth as organizations look to protect their cloud-based applications and secure remote workers from cyber threats. In 2015, iBoss raised a $35M Series A round led by a Goldman Sachs Private Capital investing group; iBoss says this latest round will enable them to expand their sales and marketing team in order to capture the growth in cloud-native cybersecurity.
Why This Transaction?
The York IE team chose this as our transaction of the week to discuss the rapid growth in cloud-based cybersecurity solutions. With the pandemic forcing many employees to work remotely, organizations are under increased pressure to secure their networks against cyber threats. Using a zero-trust approach, iBoss becomes an attractive option for companies with dispersed workforces that rely on the cloud to operate; this approach makes traditional firewalls and web proxies, which are inadequate for protecting a cloud-native network, redundant and allows iBoss to provide network security via the cloud. iBoss, which offers security via SaaS, employs a Secure Access Services Edge (SASE) service which is an emerging technology in cybersecurity. Originally coined by Gartner, SASE (pronounced “sassy”) platforms allow organizations to venture away from traditional security measures such as on-premise hardware and software installed on user’s devices. SASE platforms are the next best thing in network security as dispersed workforces have created too much complexity and paved the way for security via SaaS; enabling this approach allows organizations to quickly scale their security measures across multiple devices via the cloud. Rather than a traditional SD-WAN platform, which uses a network overlay to connect to the cloud, SASE platforms focus on connecting individual endpoints while using a “baked-in” security approach. Using an open SASE platform, which fosters flexibility and customization for users, separates iBoss from other cybersecurity companies using a closed SASE approach which is more restrictive in nature.
In previous TOW blogs, we’ve discussed the transition to cloud-native networks and the emergence of the SD-WAN market. As the work from home trend continues and company networks are regularly accessed from multiple devices, SD-WAN platforms, which are not inherently security-focused, have proven to be inadequate. SASE platforms pick up this slack with security tools that reside in the cloud as well as user devices, making them an attractive alternative to SD-WAN platforms. Using our Fuel Platform, the York IE team collected data related to cybersecurity funding with a focus in network security related funding rounds:
According to the graph above, many investors likely saw the need for a new solution to network security far before the pandemic and work from home trend. In 2019 alone, more than $19B was invested into network security-related companies which shows the clear demand for new solutions such as SASE services. In fact, SASE originally appeared in Gartner’s 2019 “The Future of Network Security”.
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