I had the chance to explore RSA 2024 last week – the conference was certainly buzzing, and yes AI kept showing up everywhere, but it was a slower week from a market activity perspective. Far fewer announcements in M&A and capital raising than usual for RSA. Strategics are still on the sidelines and sponsors are chasing legacy assets like the Synopsys SIG deal with Clearlake Capital Group and Francisco Partners. Note that while the deal was initially flagged as worth up to $3 billion, the final value was a much lower $2.1 billion. Valuations in private markets continue to trend lower as buyers and sellers seek equilibrium.
Cloud Security Decacorn Wiz Raises $1 billion at a $12 billion Valuation
Cloud security platform Wiz had the buzziest announcement at RSA last week with its $1 billion Series E funding, valuing the company at $12 billion. This is a meaningful increase from its previous round in February 2023, when it raised $300 million at a $10.3 billion valuation.
The funding will be used to expand Wiz’s business through acquisitions, with the goal of growing inorganically and quickly reaching an IPO. The company plans to target “ex-unicorns” (startups that have raised substantial money but failed to grow as expected) and “exciting, younger startups” for potential acquisitions.
Wiz has already acquired Gem Security and had signed a letter of intent to buy Lacework as I previously reported, but the latter deal fell through in due diligence. The company has a long list of potential acquisition targets in the cybersecurity space, including 62 startups with valuations over $1 billion.
The funding will also be used to grow Wiz’s organic business by hiring more talent and investing in research and development. The company aims to reach $1 billion in annual recurring revenue (ARR) by the end of 2025, which is a stretch goal given current scale of $350 million in ARR.
Wiz’s traction in the market can be attributed to its all-in-one platform approach, which covers 13 areas of cloud security and integrates with other startups to build out its ecosystem. The company has also been expanding its activity in AI security posture management.
The funding round was co-led by Andreessen Horowitz, Lightspeed Venture
Partners, and Thrive Capital, with participation from Greylock, Wellington Management, and previous backers Cyberstarts, Greenoaks, Index Ventures, Salesforce Ventures, and Sequoia Capital. The total amount raised by Wiz is now $1.9 billion.
Atlan Raises $105 mm
Atlan, a data collaboration software provider, has raised $105 million in its Series C funding round, co-led by Singapore’s sovereign wealth fund GIC and Meritech Capital. The startup’s post-money valuation has increased to $750 million after this fund raise.
Founded in 2018, Atlan allows enterprise teams to collaborate on projects and provides a single source for all data assets on its platform. The company claims that it has witnessed over 7X growth in revenue over the last two years, with a 75% win rate in competitive trials and 400% enterprise sales growth in Q1 2024.
Atlan’s solution aims to address the issue of disconnected data systems and silos by centralizing data management and uniting data producers and consumers throughout an organization. The company’s customer base includes Cisco, Unilever, Autodesk, and Nasdaq.
The funding round also saw participation from existing investors Salesforce Ventures and Peak XV Partners. This latest round brings Atlan‘s total funds raised to $206 million since founding.
Datalogy AI Raises $46 million Series A
DatologyAI, a dataset curation platform for AI, has raised $46 million in Series A funding to help companies build datasets for AI models. The platform allows businesses to automatically compile data for AI training, enabling them to train models faster and improve their performance.
The funding round was led by Felicis Ventures, with participation from M12, Microsoft’s Venture Fund, the Amazon Alexa Fund, Elad Gil, Radical Ventures, Amplify Partners, and existing backers. The funds will be used to hire more staff, including researchers and engineers, as well as increase infrastructure to power the platform.
DatologyAI‘s CEO, Ari Morcos, stated that the quality of a model’s output is directly proportional to the quality of its input data. The company aims to provide a platform where businesses can have more control over the types of data going into their models, enabling them to train models faster and improve their performance.
The startup has already received significant backing from prominent figures in the AI industry, including Meta‘s chief AI scientist Yann LeCun, Google DeepMind‘s chief scientist Jeff Dean, and Geoffrey Hinton, one of the pioneers of artificial neural networks. The total capital raised by DatologyAI is now $57.5 million.
RunPod Raises $20 mm in Seed Funding
RunPod , a platform for deploying custom full-stack AI applications, has raised $20 million in seed funding led by Intel Capital and Dell Technologies Capital. The company’s cloud computing service allows developers to spin up on-demand GPU instances and create auto-scaling API endpoints for scaling inference on AI models in production.
The funding will be used to enhance the day-to-day life of developers, form new partnerships and integrations for seamless user experiences, and offer new and existing customers a foundation for developing custom AI models. The platform has seen rapid growth, with a 10-fold increase in revenue year over year, and now boasts a community of over 100,000 developers.
RunPod‘s CEO, Zhen Lu, attributes the company’s success to its ability to strike a balance between providing developers with freedom to launch their own projects while also offering the necessary infrastructure and tools to assist in customization, development, and deployment. The platform has also recently launched the ability to deploy CPU compute instances, marking a significant milestone in creating a holistic cloud solution.
In addition to Intel Capital and Dell Technologies Capital, the round included participation from individual investors Julien Chaumond (CTO of Hugging Face) and Nat Friedman. Mark Rostick, Vice President and Senior Managing Director at Intel Capital, will join RunPod‘s board of directors.
EQT Acquires WSO2
WSO2, an API management and identity and access management (IAM) software company, has been acquired by Swedish investment giant EQT Group for over $600 million. EQT Group will have a “significant majority” stake in WSO2, which was founded in Sri Lanka in 2005 and had raised around $130 million in funding from investors including Intel Capital, Cisco, and Goldman Sachs.
WSO2 provides products such as an open-source API manager and Identity Server, which offers identity and access management functionality. The company has a strong track record in the open source sphere and has a global spread of customers including AT&T, Honda, and AXA.
The acquisition was made by EQT Private Capital Asia, a subsidiary of EQT that focuses on private equity investments in Asia. Hari Gopalakrishnan, a partner at EQT Private Capital Asia, stated that WSO2 is well-positioned to capitalize on long-term trends such as digital transformation and rising adoption of artificial intelligence (AI).
The acquisition is expected to close in the second half of 2024.