In New Era of Cyber Threats, Rapid7 Reloads With $30M
Cyber attacks and data breaches aren’t going away anytime soon. Neither are the technology companies trying to protect against them—nor the venture investors looking to cash in.
Rapid7, a Boston-based company, says today it has raised $30 million more from previous investors Bain Capital Ventures and Technology Crossover Ventures. The deal brings its total funding to about $90 million. The company’s last big round was a $50 million Series C in 2011, and it now has about 500 employees.
If you look at where big venture rounds are going in New England tech companies, it’s mostly to enterprise IT areas like data storage (DataGravity), business analytics (InsightSquared), business communications (ThinkingPhones) and security (Veracode), with a few outliers like DraftKings on the consumer side.
Rapid7 is part of a veteran group of Boston-area security companies that includes Veracode, CyberArk, and Bit9. The latter two have some similarities to Rapid7 in what they provide. CyberArk had an IPO in September, while Bit9 acquired Carbon Black in February and is often talked about as an IPO candidate.
What’s interesting about all of these companies is that they’ve had to adjust to big changes in cyber attacks in recent years. Veracode has moved into mobile and Web application security. CyberArk has been targeting insider threats against sensitive data. Bit9 (with Carbon Black) now covers incident detection and response as well as protection against breaches.
Rapid7, which was started in 2000 in New York City, is known for its software that helps organizations find security flaws in IT infrastructure and check whether they’ve been corrected. But in the past year or so, it has moved more strongly into detecting and investigating attacks once they’ve occurred, and providing strategic services to help big customers manage security programs.
The strategy appears to be paying off, as Rapid7 said its third-quarter revenue was the highest in its quarterly history (no numbers given, though). The company’s performance is enough to justify optimism from CEO Corey Thomas, who took over from Mike Tuchen in 2012. “We believe companies can be successful in security without slowing down their business,” Thomas said in a statement.