Simplification has been a big theme in the enterprise world in the last couple of years. If a company can consolidate multiple point solutions into one product or contract, it can reduce complexity and ultimately costs for the end user — so long as those all-in-one offerings are effective at doing the job that 5, 10 or 30 separate pieces of software were doing before.
Today, a startup called Coro — which provides a one-stop-shop AI-based cybersecurity platform — is announcing $75 million in funding, a sign of the traction it’s been getting to date with its target customers, mid-market companies. (‘Mid-market’ is anything between 500 and 4,000 employees, in the eyes of Guy Moskowitz, Coro’s CEO and co-founder.)
The funding is coming from a single investor, Energy Impact Partners, known for green-tech investments as well as backing a number of cybersecurity and enterprise startups. This is effectively a “Series C2”, coming almost exactly a year after Coro — founded in Israel but with offices also in the U.S. and the U.K. — announced a $60 million Series C from Balderton and JVP, with a valuation that directly tacks the new funding onto the old valuation: Coro’s valuation was $500 million, and post-money it is now $575 million.
Coro’s aim is to provide a cloud-based, SaaS offering to cover all of a business’s cybersecurity software needs, with the main themes being device monitoring; tools for overseeing activity across users, email, networks, data and apps; and remediating any malicious activity when it’s identified.
Coro’s target customer, the mid-market business, often fall into a grey area when it comes to software: too big to use SMB products usefully and safely, yet too small to have the infrastructure and budgets to use products built for larger enterprises.
But because companies of this size are still a lucrative target — and one that’s often under-secured, as it happens — they often find themselves in the crosshairs of malicious hackers. One report found mid-market companies to be 350% more likely to face a cyber attack than larger businesses, and as a signal of the opportunity here (and the problem), in general mid-market companies are becoming more aware of the issues.
That also means competition to serve their needs. Others in the same space (providing varying levels of different security products) include Secureframe, Forcepoint, Red Canary, and others.
Coro does not disclose whether it is profitable, but co-founder Dror Liwer said in an interview that it grew its annual recurring revenues 300% each year for the last four (the company is actually older than that: it started in 2015 as a consumer-focused device security business called Coronet but pivoted to enterprise around 2019).
Notably — in a year of belt tightening amid wider economic slowdowns and inflation– it’s on track to do the same in 2022. It currently has around 5,000 customers.
Inflation may not have slowed down Coro’s growth, but it has had another impact: Coro recently put up its prices to $8.99/user/month, but it claims its overall tariffs are still far lower than the prices companies would pay if they were buying, integrating and managing a number of security apps to address the same range of use cases and scenarios that Coro does. Typically, a customer of the size that Coro targets might have between 15 and 25 security products, paying in total between $25 to $45/user/month.
“It becomes a no-brainer,” said Coro’s co-founder Dror Liwer.
The funding will be used across a few areas.
The first of these will be investing in more R&D. Tamping down some of the hype of the moment, the company has been using AI “since day one,” Liwer said. “For us, it’s not a buzzy thing at all.”
Its use of AI been in the form of unsupervised machine learning that is constantly tracking traffic for its customers, detecting anomalies and increasingly learning more about malicious practices as time passes, knowledge that is then applied across the whole of its platform to all of its customers and helps Coro not just fend of known bad actors and actions but also discover new approaches.
There are no uses of generative AI at Coro itself, he said, and — for security reasons — he declined to comment on what it might be working on in this space, or what the biggest new threats might be — but he did note that AI has had another major impact for Coro and its customers: a huge spike in malicious hacking attempts, with most of that new volume getting generated by AI — generative AI, specifically.
“We are seeing threat actors using AI to better hone their abilities, whether it’s to crack credentials or write better phishing emails. The whole gamut,” he said. They were already doing all that, he added, “but we’re seeing an uptick in the amount.”
The other area of focus will be to do act on a little M&A, taking advantage of the fact that there are a lot of talented engineers and promising technology being built in the cybersecurity space, but a lack of funding at the moment for point solutions: all of that translates into opportunities for opening conversations with smaller startups that might have not been as easy to do in the past.
The third will be to continue hiring — Coro one of the coveted group of startups that has added staff rather than laid people off in the last year — and business development.
“Coro’s phenomenal growth shows they have the right solution for a huge and underserved market,” said Shawn Cherian, a partner at Energy Impact Partners, in a statement. “Mid-market companies need a comprehensive cyber solution that protects their vital business assets without spending outrageous sums or requiring hard to find cybersecurity experts. Coro’s AI-powered platform, based on a modern approach to solving cybersecurity challenges, is taking the market by storm. We’re thrilled to be a part of the Coro revolution as they help secure the nation’s mid-market businesses and enable them to grow and thrive.”