Lacework lands $1.3B to boosts its cloud cybersecurity platform

Lacework has announced that it closed a $1.3 billion funding round, valuing the company at over $8.3 billion post money. Sutter Hill Ventures, Altimeter Capital, D1 Capital Partners, and Tiger Global Management led the round with participation from Franklin Templeton, Counterpoint Global (Morgan Stanley), Durable Capital, General Catalyst, XN, Coatue, Dragoneer, Liberty Global, and Snowflake Ventures. Co-CEOs David Hatfield and Jay Parikh said the funding will support Lacework’s product development efforts as the company expands its engineering and R&D initiatives.

As the pandemic prompts companies to move their operations online, many - if not most - face increasing cybersecurity challenges. According to an IDC report, 98% of companies surveyed in H1 2021 experienced at least one cloud data breach in the past 18 months. At the same time, 31% of respondents said they’re spending more than $50 million per year on cloud infrastructure, opening them up to additional attacks if their cloud environments aren’t configured correctly. In its 2021 Cloud Security Study, Thales found that only 17% of companies encrypt more than 50% of sensitive data that they host on cloud environments - despite the surge in ransomware attacks.

Lacework, which was founded in 2015 by Mike Speiser, Sanjay Kalra, and Vikram Kapoor, aims to close security gaps across DevOps and cloud environments by identifying threats targeting cloud servers, containers, and accounts. Its agent provides visibility into running processes and apps, using AI to detect anomalous behavior. Concurrently, the agent monitors for suspicious activities like unauthorized API calls and the use of management consoles and admin accounts, limiting access to vulnerable ports and enforcing “least access” privileges.

Kalra previously worked at Cisco as a senior product manager. Kapoor spent six years in various roles at Oracle, overseeing work on the data layer and storage side of the business. Speiser, a managing director at Sutter Hill Ventures, was a founding investor in Lacework and remains an active member of the board.

Parikh said, “Kapoor and Kalra founded Lacework with the goal of taking a data-driven approach to cloud security. We view security as a data problem and our platform is uniquely suited to solve that problem. Traditional security solutions force companies to amass a patchwork of point solutions and then manually tell them what to watch for, resulting in an inefficient and ineffective security process. At Lacework, we use data to uncover security risks and threats.”