Email security startup Abnormal Security raises $210M in funding

Email security startup Abnormal Security raises $210M in funding

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Cybersecurity startup Abnormal Security Corp. is now valued at $4 billion after closing a $210 million funding round led by Insight Partners.

The Series C round, which Abnormal Security announced today, also included the participation of Greylock Partners and Menlo Ventures. The investment brings the San Francisco-based startup’s total outside funding to more than $280 million.

Abnormal Security provides a cloud-based platform that helps organizations protect workers from malicious emails. The platform uses artificial intelligence to detect ransomware, spam, fraud attempts and other threats. According to the startup, its AI algorithms evaluate thousands of signals to determine whether an email may be malicious. 

One of Abnormal Security’s focus areas is mitigating the cybersecurity risks that emerge when one of a company’s suppliers experiences a data breach. If hackers gain access to a supplier’s corporate network, they can potentially hijack its email servers and target customers with malicious emails. Abnormal Security says that its platform can detect and block such hacking campaigns.

The startup also helps organizations block attempts to hijack employees’ email accounts. Abnormal Security says that its platform can not only detect breach attempts, but also automatically log out potentially malicious users. Similarly, the platform is capable of resetting user passwords and notifying information technology teams when a cybersecurity risk emerges.

Abnormal Security generates a report about each potential hacking attempt that it blocks. The startup’s platform provides technical data about the incident, as well as a high-level summary, that IT professionals can consult to better understand the cyberattacks targeting their organization.

Besides helping companies block hacking attempts more effectively, Abnormal Security also promises to simplify their IT operations. Enterprises commonly use a type of cybersecurity tool known as an email gateway to protect employees’ inboxes. The startup says its platform removes the need to use email gateways, thereby simplifying IT departments’ work. 

Abnormal Security disclosed today that its annual recurring revenue has tripled over the past year but didn’t share absolute numbers. The startup lists several Fortune 100 companies as customers. 

“Over 5% of the Fortune 1000 now rely on Abnormal Security to protect them from modern email attacks,” Abnormal Security co-founder and Chief Executive Officer Evan Reiser detailed in a blog post. “Our customers have seen the value that Abnormal provides, which is evidenced by our 99% renewal rate. On Gartner Peer Insights, we have a 4.9 ranking out of 5, with a 100% recommendation from participating companies.”

To continue its revenue momentum, Abnormal Security plans to launch additional cybersecurity capabilities and establish a presence in new markets. The startup will also continue to hire more people, with a particular emphasis on expanding the customer support and customer support teams.

Abnormal Security’s funding round follows two high-profile acquisitions in the email security segment. Proofpoint Inc., one of the largest players in this market, was acquired by Thoma Bravo for $12.3 billion last April. Later in 2021, private equity firm Permira inked a $5.8 billion deal to acquire Mimecast Ltd., another major email security provider. 

Image: Abnormal Security

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