Secure content communications company Kiteworks is soaring following its announcement this week that it has raised $456 million in private equity growth funding.
Kiteworks described the funding as a “partial liquidity event,” with the growth equity coming via investors Insight Partners and Sixth Street Growth. Insight is a majority investor in MSP tools platform giant Kaseya and cybersecurity company Wiz. Kiteworks said the funding will strengthen the company’s market position in secure data transfer and collaboration.
Kiteworks operates as a “channel-first” company, working with a number of MSSPs though its Channel First Partner Program.
The San Mateo, California-based company, founded in 1999, says that it is the only security platform authorized by FedRAMP to provide unified support for file sharing, managed file transfer and email data communications to meet a broad range of global compliance requirements.
The funding will be directed toward strengthening research and development, business development, and hiring, as well as help continue its aggressive mergers and acquisition strategy, which includes the purchase of four enterprise startups, according to Kiteworks.
Kiteworks Chairman and CEO Jonathan Yaron described how the “minority stake investment” affirms Kiteworks’ mission to meeting the growing challenge of tracking and controlling the use of sensitive data.
“With recent groundbreaking innovations such as next-gen digital rights management, combined with the growing industry and regulatory focus on tracking and controlling the data layer, the road to realizing our vision has never been clearer,” he said in a statement.
Risk and Compliance Requirements Channel Growth
The fresh funding comes as organizations face an expanding cybersecurity risk due to complex third-party ecosystems and an increasingly stringent compliance landscape, according to Kiteworks. As such, Kiteworks organic growth and M&A strategy has well-positioned the company in the process control network (PCN) space. Compliance regulations such as CMMC, NIS 2 and HIPAA, necessitate strong data protection measures, and that’s where Kiteworks comes in.
Kiteworks’ PCN solutions unify the primary content communication channels of file share, file transfer, managed file transfer, email, APIs and web forms into a dedicated secure platform, according to the company. Its platform can track, control and secure sensitive content both within and outside an organization. Kiteworks claims that more than 3,650 enterprises and government agencies are using its products, with more than 100 million end users.
The investment from Insight Partners and Sixth Street Growth signals a broader recognition of the essential role that secure content communication plays in the digital world.
“We were immediately impressed by Kiteworks’ exceptional growth and innovative approach to securing content communications,” Eoin Duane, managing director at Insight Partners, said in a statement. “In today’s complex digital landscape, Kiteworks addresses a critical market need and stands out as a leader in providing effective solutions that significantly improve risk management.”
Duane, along with Peter Sobiloff from Insight Partners and Alex Katz from Sixth Street, will join Kiteworks’ board of directors.
Formerly Accellion, Kiteworks Faced 2021 Incursion
The $456 million investment in the secure email communications startup, formerly known as Accellion, brings the its valuation to more than $1 billion, according to TechCrunch. Kiteworks previously raised $120 million in 2020 in a funding round led by Bregal Sagemount, which has since sold its interest in the company.
Prior to Kiteworks changing its name from Accellion, cybercriminals exploited the Accellion File Transfer Appliance (FTA) zero-day vulnerabilities to steal and extort data from various global organizations, MSSP Alert reported in February 2021. The incursion compromised several major organizations, including Morgan Stanley, Shell, Kroger and the University of California.
The news followed after the company said earlier that month it had patched all known FTA vulnerabilities exploited by cybercriminals.
