Today we are excited to announce that our company has received $15 million in Series B financing. This funding round is led by new investor, the Invenergy Future Fund, a fund that aims to change the game for the energy industry. We share their mission and will leverage this investment to expand our leadership of industrial cyber security for the energy industry and beyond.
This new financing recognises Nozomi Networks extraordinary accomplishments and demonstrates confidence in our future. It’s a testament to the company’s leadership, earned by quickly expanding our market share, delivering innovative ICS cyber security solutions and building our team.
The timing is also indicative of the state of ICS (Industrial Control System) cyber security. 2017 was a watershed year, with new attacks that directly impacted industrial control systems (Triton, Industroyer) and non-targeted ransomware attacks that caused significant harm to them (WannaCry, Petya). Such attacks highlight the need for the type of innovation in threat detection and monitoring that the Nozomi Networks solution provides.
Let’s take a closer look at the reasons behind today’s announcement, and our company’s outlook as we enter 2018.
Company Performance Exceeded Expectations in 2017
In the wake of multiple large industrial deployments in Europe, at the start of 2017 Nozomi Networks brought its ICS cyber security solutions to the global market. We began ramping up sales and marketing and increasing technical staff in the field. We had received $7.5 million in funding in October 2016 and were focusing on meeting growing customer demands to secure their industrial and operational technology environments.
By the end of 2017 our solutions were broadly deployed on 5 continents and Nozomi Networks emerged as the leader in our market with an impressive track record of achievements:
- Market share was gained across energy, manufacturing, pharmaceutical, chemicals and other industrial sectors
- Company size, in terms of employees, quadrupled
- Revenue goals were exceeded, growing almost 5x the prior year, with flagship accounts in all continents
- Product innovation and delivery was excellent:
- Two major product releases were achieved
- We introduced the first ICS cyber security monitoring solution to offer hybrid threat detection (behavior and signature-based detection) and the first one designed for MSSPs (Managed Security Service Providers.)
- Our product suite is now on its third generation and consistently receives top score from companies who implement or test it.
- Partnerships were established with leading IT security companies such as FireEye and Fortinet as well as leading SIs (System Integrators) and VARs (Value Added Resellers.)
To learn more about our accomplishments, see the Nozomi Networks Take the Lead infographic.
Great execution also includes timing of funding with market fit and product success. We are very proud that we resisted the temptation of raising too much money before our product was known to lead a market that was ready to consume it. Now that large customers and sophisticated partners have made their choice, it makes sense for us to raise a growth financing round.
Our ability to execute, the right timing, and an ICS cyber security market which is predicted to grow to more than $13.8 billion worldwide by 2022 (according to market researcher Market and Markets), is what laid the ground work for further investment in our company.
Introducing Invenergy and the Invenergy Future Fund
Innovation and thinking differently is core to the Nozomi Networks culture, and that outlook lines up perfectly with our new investor, the Invenergy Future Fund.
The Invenergy Future Fund invests in technology companies that are changing the game in energy and where its capital and expertise help create unique competitive advantages. The Fund knows the challenges of developing and commercialising hardware and software products and services, and shares this know-how with the companies it invests in.
The Invenergy Future Fund is associated with Invenergy, a company that develops, owns and operates large-scale renewable and other clean energy generation and storage facilities. Invenergy has more than 100 projects in development or operation across the U.S., Canada, Europe, Japan, and Latin America. The Fund also includes a number of energy utilities and industrial companies amongst its own investor base, and these firms will further strengthen Nozomi Networks.
Founded by clean energy pioneer, Michael Polsky, Invenergy’s wind, solar and natural gas project portfolio totals 7,897 megawatts. The company is focused on leveraging innovative design and next-generation technology to create a new paradigm for energy production.
Why Invenergy Future Fund Invested in Nozomi Networks
The Invenergy Future Fund believes that industrial entities are increasingly looking to software applications that dramatically improve security and operational efficiency at scales never before imagined. It focuses on businesses that serve not only the energy industry, but that also have widespread application throughout the industrial ecosystem.
“We believe that the historical boundary between industrial and energy industries is vanishing as technology solutions and platforms converge upon the verticals.”
- The Invenergy Future Fund: Insights blog
The need to protect remote and distributed industrial sites, the growth of the ICS cyber security market, and the alignment with a technology innovation approach led the Invenergy Future Fund to invest in Nozomi Networks.
“Nozomi Networks’ superior technology and team have made them the market leader in securing energy and other critical infrastructure industries from escalating cyber threats. The Invenergy Future Fund invests in companies and people that are defining the future of energy. We are proud to accelerate Nozomi Networks’ efforts to ensure that the future of energy is secure.”
Michael Polsky, Founder & CEO of Invenergy and Chair of the Invenergy Future Fund investment committee
“While the Nozomi Networks product is industry-leading, it is the team’s customer focus that drove home the conviction for our investment. The company has an excellent reputation working with customers to understand their specific requirements and then delivering incremental protocols and bespoke configurations in record time, enabled by the agility of Nozomi Networks’ software.”
Invenergy Future Fund Insights Read the full article
New Investment Fuels High Growth Plan for 2018
In addition to new lead investor the Invenergy Future Fund, our oversubscribed financing included all prior investors (GGV Capital, Lux Capital and Planven Investments) plus THI Investments, an investor who backs companies designed to adapt to and thrive on rapid global change.
Thanks to the Series B financing announced today, on top of the Series A round, Nozomi Networks has the resources it needs to further accelerate growth in 2018 and beyond. We are investing in our worldwide marketing, sales and support organizations, and expanding our industry-leading agile development team.
We look forward to the future and encourage you to contact us to learn why our ICS cyber security and operational visibility solution is securing and enabling the future of energy and other critical industries.