UPDATE: Agiliance raises $6.5 million for yet another security co — but wait, this one’s different!

(Updated: Intel has also since invested in the company. The story below was written 10/10/06)

Agiliance, a Mountain View start-up that helps companies prevent breaches of their IT network security and compliance policies, has raised $6.5 million in a second round of funding.

Walden International and Red Rock Ventures led the investment.

We’ve seen so many of these sorts of security investments that we pressed Agiliance’s Pravin Kothari, founder and chief executive, and Anil Gupta, head of marketing, why anyone would ever think of investing in yet another security company.

They conceded that it looks like a crowded space, but Kothari, who was founding VP of engineering at Silicon Valley security start-up, ArcSight, said that his company is part of a more recent group of security companies that preempt problems from happening, rather than simply diagnose security or policy breaches after they happen (like ArcSight does).

They said half a dozen companies — some of them Fortune 500 companies – are using the company’s software. But they would not say how many are paying. They also did not mention the company names. They said the company is officially launching today, and that its product will be publicly available within a few months.

Below is their release:

MOMENTUM ACCELERATES FOR AGILIANCE WITH
FUNDING FROM WALDEN INTERNATIONAL AND RED ROCK VENTURES

Agiliance closes $6.5 million Series B Funding

Mountain View, California, October 10, 2006 • Agiliance, a leading provider of Security Risk and Compliance management solutions, today announced that it has closed $6.5 million in Series B funding. The investment was led by global venture capital firm Walden International in San Francisco with participation from Red Rock Ventures.

In connection with the financing, Agiliance added two new members to its Board of Directors: Mary Coleman of Walden International and Kip Myers of Red Rock Ventures. Cliff Higgerson of Walden International joins as a Board Observer.

“Security Risk and Compliance remain at the top of executive agendas at most Fortune 1000 companies, and organizations are challenged to improve visibility and effectiveness while reining in costs in these areas”, said Pravin Kothari, Founder and chief executive officer of Agiliance. “The market is responding well to our top-down, risk-oriented Security and Compliance management solution. Our new financing validates our progress and allows us to accelerate our product development as well as sales and marketing efforts. I am also very excited about the valuable perspectives that our new board members bring to the company.”

“Agiliance is filling a huge need in the Security Risk and Compliance management market by delivering a solution that addresses board-level, line-of-business, and operational concerns; we are pleased to lead its next stage of expansion,” said Mary Coleman, Managing Director at Walden International. “The company has great potential and we’re confident about its long-term success.”

The Agiliance solution enables organizations to analyze and decrease security risk, achieve continuous visibility of risk and compliance, and significantly reduce the cost of compliance with internal and external requirements. Its holistic risk-based solution integrates business processes, applications, IT assets, physical assets, employees and vendors, allowing organizations to comply with government regulations (e.g., Sarbanes-Oxley 404, HIPAA, GLBA and FISMA), industry mandates (e.g., SAS 70 and PCI), as well as corporate policies.

Using standards and frameworks based controls (e.g., ISO 17799/27001, CobiT, FFIEC and NIST); Agiliance enables organizations to select and implement a common set of IT controls, both manual and automated, to effectively establish and maintain compliance with multiple requirements without duplicating efforts.

Agiliance’s patent-pending technology enables organizations to continuously assess, correlate and quantify risk arising from non-compliant policies based on business impact, as well as other external factors, such as vulnerabilities and threats, and gives continuous visibility into their risk and compliance posture. Armed with this key information, users can easily prioritize risk mitigation and fine tune the deployment of appropriate controls. As a result, Agiliance enables organizations to gain continuous visibility into security risk and compliance, reduce their risk, and lower the complexities and costs associated with compliance.