Cybersecurity startup Exabeam has raised $75 million in a series E round of funding co-led by Sapphire Ventures and Lightspeed Venture Partners, with participation from all existing investors, including Cisco’s investment arm.
Founded in 2013, San Mateo-based Exabeam meshes machine learning, big data, and analytics to detect and thwart cyber threats — the platform falls under the cybersecurity umbrella known as “security information and event management,” or SIEM.
Exabeam continuously monitors the sources of companies’ log data to determine “normal” activity so it can spotlight unusual activities and allocate a risk score. It can typically take weeks for a system to get up to speed on a company’s normal activity, but analyzing historical data can reduce this time to a matter of days.
A number of SIEM companies compete in the field, including Splunk, whose shares recently hit an all-time high of around $140 — up some 700% on its $17 IPO price in 2012. Other notable platforms include legacy players such as RSA, which is owned by EMC, and LogRhythm, which was snapped up by private equity firm Thoma Bravo last year.
Prior to now, Exabeam had raised $115 million — including a $50 million round just eight months ago — and with another $75 million in the bank the company will be well-financed to continue on its previously stated mission of usurping Splunk, among other “legacy vendors,” to become the SIEM market leader.
“Looking broadly at the security market in recent years, there have been several big exits from companies replacing legacy authentication and endpoint protection vendors,” noted Lightspeed Venture Partners’ Ravi Mhatre. “Security management is next, and Exabeam is well-positioned to be the leader.”
More specifically, the funds will be used to invest in Exabeam’s R&D and grow its sales team globally.
In the cloud
Since its last big raise, Exabeam has launched a new cloud-based SIEM service called Exabeam Saas Cloud, and the company said it has expanded its sales team and its Technology Alliance Partnership program, which includes hundreds of software and services vendors.
“Over the last year, we’ve seen our strategic value increase, and our average deal size has grown by 100% from just two years ago,” said Exabeam CEO Nir Polak. “This is because we’re listening to our customers and delivering the innovative technologies they need, including, most recently, the ability to detect threats in the cloud.”
With business-targeted cyber attacks on the rise, cybersecurity is estimated to become a $250 billion industry by 2023, and some figures anticipate the SIEM segment specifically will reach $6.75 billion by the same year — a sizable niche, in other words.
“We’ve chosen to back Exabeam because of the momentum the company has in a very large and important market,” added Sapphire Ventures managing director Anders Ranum. “Nir and the team are solving the problems that legacy SIEM vendors don’t seem to realize they have, and to us that demonstrated unmistakable value. As cyber attacks, cyber warfare and corporate espionage are on the rise, Exabeam is enabling companies to analyze user behavior and spot even the most subtle anomalies in a way no other SIEM vendor has.”