Armis, a Palo Alto-based company developing enterprise security products for internet of things (IoT) devices, today announced that it closed a strategic investment from Brookfield Asset Management and Georgian partners, bringing its total venture capital raised to date from $112 million to over $300 million. Armis, which is valued at $2 billion post-money, twice its 2017 valuation of $1.1 billion, plans to use the new investment to fund a backlog of product development and to expand its marketing and sales teams.
According to IDC, there will be more than 40 billion connected devices by 2025, but many of these devices won’t have security defenses. According to a recent study conducted by the University of Maryland, there’s a hack attempt every 39 seconds on average. The Kelser Corporation estimates that 65% of small and medium-size companies are the target of attacks, and that those attacks might have cost as much as $2 trillion in total by year-end 2019.
Three entrepreneurs — Google veteran Nadir Izrael, Adallom director of security research Tomer Schwartz, and Adallom global business development head Yevgeny Dibrov — founded Armis in 2015 to tackle the growing intrusion threat. Armis, which Insight Partners acquired in February 2020, offers a software-as-a-service solution that runs in an agentless fashion and autonomously identifies devices in wired and wireless networks even before they connect to said networks. Armis analyzes devices’ behavior to identify attacks and calculate a risk score, automatically disconnecting or quarantining suspicious laptops, smartphones, printers, medical devices, and other hardware while respecting existing firewalls, security information and event management, and network access control policies.
Armis isn’t exactly going it alone in the IoT cybersecurity space. Gartner said that cybersecurity spending grew from 8.7% to $124 billion in 2019. Mocana, which develops an end-to-end, on-device software suite for a range of systems, recently raised $15 million. And Israeli startup Axonius in early 2019 raked in $13 million.
But Armis claims to operate at a larger scale than many of its rivals, with over 500 million devices under management globally. Over the past couple of years, revenue grew more than 750% while the number of customers — among them Mondelēz, Sysco, Fresenius, Home Depot, Oracle, and DocuSign — rose over 425%. Armis also expanded its team to over 350 employees in 2021, including the appointment of a chief revenue officer and chief financial officer.
More recently, Armis launched a reseller program designed to create “long-term profitable partner growth.” This came prior to the debut of an asset management offering that Armis claims delivers over 5 times visibility than others solution on the market.
“Brookfield’s footprint spans far and wide, including physical infrastructure and healthcare assets, which are sectors that are increasingly turning to Armis to help them protect the exploitation of blind spots from connected device adoption. Bad actors are taking advantage of the lack of security on these devices … and attacks on these businesses are growing at exponential rates with severe real-life consequences,” Dibrov said in a statement. “In addition, as COVID-19 vaccinations rollout this year, our partnership with Brookfield and its massive real estate footprint of over 500 million square feet in commercial office space provides an opportunity to work with companies to ensure data and information security as they bring employees back to the office with more devices than ever before.”
Existing investors including Insight Partners, Alphabet’s CapitalG, and Georgian participated in the strategic growth investment. Insight Partners will remain the majority owner, and Armis will continue to operate independently, fully managed by Dibrov, Izrael, and the rest of the executive team.
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