There is a malicious attack every 39 seconds on internet-connected devices; three new phishing sites are launched every minute. Seconds can make a difference in the fast world of cybersecurity when encountering a breach, which costs $3.86M on average. Deep Instinct is an end-to-end cybersecurity detection platform that leverages deep learning to process threats faster than other solutions. The company has reduced threat detection to mere milliseconds, ensuring that companies are able to detect zero-day attacks before any critical infrastructure or sensitive data is compromised.
AlleyWatch caught up with Cofounder and CEO Guy Caspi to learn more about how his experience in the Israel Defense Forces inspired the platform, the state of the cybersecurity market, the company’s latest funding round, which brings the total funding raised to $200M, and much, much more.
Who were your investors and how much did you raise? Was it seed, Series A, B, etc?
We successfully raised $100 million in Series D funding for this most recent round. The round was led by funds and accounts managed from BlackRock, with participation from Untitled Investments, The Tudor Group, an investment by Anne Wojcicki, and existing investors, including Millennium, Unbound, and Coatue Management, among others. This new capital doubles the investment to date, bringing the total funding to $200 million, and will fuel the company’s aggressive growth plans for 2021 and beyond.
Tell us about the product or service that Deep Instinct offers.
The Deep Instinct platform can predict, prevent, and analyze cyberattacks at any touchpoint of the organization from the endpoint through to the network and in the cloud. Much like autonomous vehicles, speech recognition and recommendation engines have leveraged deep learning to turbocharge their applications, Deep Instinct is pioneering the deep learning adoption in cybersecurity.
Deep Instinct’s cybersecurity platform utilizes end-to-end deep learning to specialize in threat prevention, making it the most efficient and effective cybersecurity solution in the market. Our zero-time cybersecurity solution stands on top of the only deep learning framework purpose-built for cybersecurity, allowing Deep Instinct to process file-based threats faster than other endpoint solutions.
What inspired the start of Deep Instinct?
I was on Israel’s Defense Forces’ cyber elite team, which plays a critical role in national security. From that experience, I know that what is happening today in terms of threat actors’ sophistication and complexity is out of control and will only continue. What most people see or read is just the tip of the iceberg. The status quo approach to security is antiquated, reactive, and insufficient.
The biggest problem in security was prevention and still is. While most organizations focus on detection, we aim to prevent an attack before it gains access to your organizations’ infrastructure because, in many cases, detection is too little too late. Further, analyzing huge amounts of data from so many different vendors only adds to the security challenges of bandwidth and prioritization. We sought out to solve the pervasive industry issues of prevention and analytics overload by developing the industry’s only innovative deep learning solution to get ahead of prevention with analysis that provides accurate and useful information.
How is Deep Instinct different?
Deep Instinct is the first and only company using end-to-end deep learning technology for cybersecurity. With 80 percent of successful breaches leveraging new or unknown zero-day attacks, the need for disruptive innovation in this space is more critical than ever before. Deep Instinct stops unknown, never-before-seen threats in less than 20 milliseconds and reduces false positives by 99 percent – the lowest rate in the industry. The company’s confidence is reflected by providing both the industry’s first false-positive warranty and the industry’s largest ransomware warranty, backed by Munich Re Group.
What market does Deep Instinct target and how big is it?
Deep Instinct serves to protect the enterprise. We currently protect 2.5 million endpoints across North America, Europe, APAC, and Australia, with enterprise customers tripling in the last year including strategic wins with multiple Global 2000 companies in Q1 2021.
How has COVID-19 impacted the business?
As businesses are relying on the cloud to conduct their business and maintain productivity with remote workforces, the need to protect the cloud is greater than ever. Millions of employees are now using their personal smartphones, tablets and laptops for work – and these devices may be easier to compromise. With the massive shift to home offices, we’ve had to increase scale to meet the security needs of our customers.
What was the funding process like?
Walking potential investors through our vision for the company is something we are very passionate about and enjoy doing. We ended up having almost $200 million in demand for our offering, which we view as a significant validation of our strategy.
What are the biggest challenges that you faced while raising capital?
Raising capital for a startup is obviously extremely important and is an imperative to driving future growth, but finding the hours in the day to balance running the business while also making yourself available to potential shareholders is the biggest challenge. The key to doing so successfully is ensuring that you have a strong team around you that you can empower to be your partner in running the business.
What factors about your business led your investors to write the check?
Cybersecurity is the top spending priority for CIOs globally, it has been for the last 20 years and will be for the next 20+ years at least. The attack vectors, sophistication of the attacks, and the sheer volume of attacks continues to grow exponentially and has only been exacerbated by working from anywhere. As we are the leading deep learning cybersecurity company, protecting not only endpoints but also networks by leveraging the same deep learning platform, investors were drawn to our vision of the next phase of protection, which is prevention. Investors agree with this vision and saw the competitive advantage we currently possess.
Cybersecurity is the top spending priority for CIOs globally, it has been for the last 20 years and will be for the next 20+ years at least. The attack vectors, sophistication of the attacks, and the sheer volume of attacks continues to grow exponentially and has only been exacerbated by working from anywhere. As we are the leading deep learning cybersecurity company, protecting not only endpoints but also networks by leveraging the same deep learning platform, investors were drawn to our vision of the next phase of protection, which is prevention. Investors agree with this vision and saw the competitive advantage we currently possess.
What are the milestones you plan to achieve in the next six months?
The majority of our capital raise will be spent on building out our go-to-market initiatives as well continued evolution of our deep learning platform. As we ramp our hiring, we expect a significant acceleration in our new customer signings and as such our annualized recurring revenue trajectory.
Where do you see the company going now over the near term?
As Deep Instinct enters a new phase of hyper-growth, this investment will support the expansion of the company’s global footprint and support new platform enhancements to meet the needs of its growing customer base. We are on the IPO journey, but we’re focused on the priorities coming out of this funding round right now. We are heads down on scaling the company’s operations, platform, and sales organization to meet the demands of our growing customer base and the consequential growing demand to thwart the insurmountable attacks out there.
