Cato Networks gets their heads into the clouds with $20 million round


Network security company Cato Networks put boot to pavement and raised a solid $20 million, they announced on Tuesday. The round was led by Steven Krausz, general partner at U.S. Venture Partners (USVP), and Theresia Gouw, founder of Aspect Ventures.

The company was founded and until Tuesday morning self-funded by Shlomo Kramer and Gur Shatz. Kramer notably was the co-founder of security titan Check Point and the CEO and founder of Imperva. It is worth noting that Gouw and Krausz invested in Kramer’s past ventures. Schatz brings cloud expertise to the house and was the CEO and co-founder of security company Incapsula.

“The velocity of security threats surpassed the speed at which enterprises can adapt their existing controls, exposing a mismatch between hackers and the businesses they target,” Kramer said in a press release.

CEO Shlomo Kramer. Photo Credit: Sharon Barkat
CEO Shlomo Kramer. Photo Credit: Sharon Barkat

“The forces of cloud and mobility have dissolved the network perimeter, one of the biggest challenges facing network security today in the increasingly distributed and fragmented enterprise,” added Theresia Gouw, one of the key investors. “Cato Networks is focused on making network security simple again.”

Adding another aaS abbreviation might be a bit ad-nauseating, but it plays. Cloud-based solutions now dominate network security. Market research company Infonetics projects the global network security market will be worth $7.5 billion by 2020, growing at a CAGR of 1.5% per year. Other startup competitors in the NSaaS field include FortyCloud, Alert Logic, OpSource, Rook Security, Pertino, and fellow USVP investee PLUMgrid among others.

Cato has put out an open call for beta customers to test the solution. They hope it will reach the market in the first half of 2016.

The company was founded just this year by CEO Shlomo Kramer and CTO Gur Shatz. They employ 20 people with headquarters in Tel Aviv. The new investment will go toward expanding its marketing and development divisions for its Network SaaS (NSaaS) platform. Krausz and Gouw will join the company’s board.

Cloud security on fire in Israel

Cybersecurity has always been a strong sector in Israel’s tech ecosystem, but this week, this has been particularly the case. Israel’s illusive networks scored a whopping $22 million Series B round within four months after securing Series A financing and Microsoft bought Secure Islands for somewhere between $100 and $150 million, making it their 3rd Israeli cybersecurity acquisition in a year. In particular, investors are attracted to many of these companies’ ability to protect enterprise solutions in the cloud, including Adallom, which was Microsoft’s second cybersecurity purchase in Israel, was sold for $320 million, and helped Microsoft establish a cybersecurity center in the startup nation.

Laura Rosbrow contributed reporting. 


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