Today (Tuesday), Israeli startup Cato Networks, which develops a cloud-based Secure Access Service Edge (SASE) platform, announced the closing of a $130 million mega funding round. The round was based on an over $1 billion company valuation, which introduces yet another Israeli member into the prestigious Unicorn club. The investment was led by Lightspeed Venture Partners, which led the startup’s two previous rounds as well, and new investor Coatue joined the group, alongside existing investors Greylock, Aspect Ventures / Acrew Capital, Singtel Innov8, and Cato founder Shlomo Kramer.
COVID reality increases remote user connection by 300%
Cato Networks’ organizational network provides customers with a number of key advantages, including minimizing enterprise required cyber-security products, while also saving on purchase expenses, deployment, and upgrades; reduction of connectivity costs by significantly decreasing internet traffic on the corporate communications network; direct access to the cloud; singular security policy enforcement for all websites, mobile users, physical and cloud infrastructure without the need for multiple pinpoint solutions as well as dynamic and up-to-date security based on a platform that requires no customer involvement.
In a conversation with Geektime, CEO Shlomo Kramer tells that following Gartner’s announcement of the new SASE category, which redefines the security and communications architecture onto a unified cloud-based service, Cato Networks witnessed significant adoption of SASE by major relevant market players: Juniper, Cisco, Fortinet, PaloAlto, HPE, VMware. Kramer notes that all these market giants acquired SD-WAN players, in order to complete their SASE product offering.
"SASE is the hottest area in IT, and this funding round further attests to Cato's leadership of the SASE market," says Shlomo Kramer, CEO and co-founder of Cato Networks. "Only the Cato Cloud was built from the ground up as a converged and cloud-based global SASE service."
Kramer further discloses that since the company’s last funding round in April, the company’s revenues had doubled YoY. “We increased exponentially our global network in Asia, South America, and further fortified our European and U.S. infrastructures,” Kramer explains. According to him, the company announced a remote access option to its network, which has become a crucial feature during the work-from-home global pandemic.
After raising $77M just six months ago, why did the company need to fundraise again, and this time almost double the amount?
Kramer: “The market accelerated investments in our competitors and customers’ awareness of SASE. Cato is going to seriously increase its spend on development, marketing, and sales, in order to cement its clear architectural advantage compared to the stacking of boxes and services from acquisitions and self-development from the market’s big names.”
During the last round, you claimed that COVID would drive enterprises to adopt solutions like yours. Did you actually see any kind of spike?
Kramer: “Cato experienced a 300% increase in home workers connecting to cloud services - in a period of only 3 months. Existing customers purchased tens of thousands of remote licenses for their massive WFH workforce. The solution was deployed to those masses within a couple of days.”
Kramer further explains that today, almost every new transaction includes a remote package, with part of the customer implementing the solution strictly for their thousands of user remote connection.
Cato Networks was founded in 2015 by Shlomo Kramer and President and COO Gur Shatz. Kramer is a veteran in the data-security field, and one the original Check Point and Imperva founders. While Shatz comes from the cloud-based application security sector, and prior was CEO and co-founder of Incapsula. To date, Cato Networks has raised $330 million.