Goldman Sachs-Backed Cybersecurity Startup deepwatch Closes $53M in Series B

Cloud-based SecOps and managed security monitoring provider deepwatch secured $53 million in Series B funding round led by Goldman Sachs. The fresh capital will be used for deepening the tech stack and expanding the partner ecosystem. 

Denver-based managed security service provider deepwatch on Monday announced a new $53 million Series B funding led by Goldman Sachs and existing investors. This latest funding comes more than a year after its $23 million Series A taking the total investment in the cybersecurity startup to $76 millionOpens a new window .

deepwatch was founded in June 2018 by Justin MorehouseOpens a new window , who currently serves as the company’s CTO. Morehouse was also the brain behind another cybersecurity startup Guidepoint Security, founded in 2012 and currently generates revenue just shy of half a billion U.S. dollars.

The startup provides client security monitoringOpens a new window and response as a part of managed client security operations, also known as SecOps. The company deploys security professionals or ‘squads’ as they call them, to handle routine security requirements of clients. Deepwatch services include 24-hour Managed Detection & Response, Managed Endpoint Detection & Response, Vulnerability Management delivered through a squad and cloud-based SecOps.

The market for managed security services was over $17.65 billion in 2015Opens a new window and swelled to $31 billion by 2020. It’s estimated that it will continue on its high growth trajectory throughout the next five years, and will become a whopping $46 billion market by 2025Opens a new window . 

The startup plans to leverage the fresh capital infusion for expanding geographic footprint,  broaden its existing partner ecosystem and accelerate the R&D of its cloud security platform.

See Also: 10 Reasons for SMBs to Consider Managed Security Service Provider (MSSP)

The pandemic inspired a great digital shift, but it also brought on cybersecurity-related challenges. The floodgates have finally opened for managed security service providers (MSSPs) that are stepping up the game with cybersecurity solutions to prevent, contain and remediate cyberattacks.

Talking about the enforced shift to work from and home and pandemic-boosted digitalization, Charlie ThomasOpens a new window , CEO of Deepwatch told Business InsiderOpens a new window , “Whether it’s retail or manufacturing or healthcare, most companies have moved to increasingly digital footprints. They create exposure for themselves and sensitive data and information.”

“We’ve experienced remarkable growth since our inception. Our innovative, cloud first platform, advanced algorithms, and powerful maturity scoring capabilities backed by our relentless focus on customer outcomes are substantially changing modern SOC operations and clearly resonating with CISOs,” Thomas added.  

Holger StaudeOpens a new window , Managing Director of Goldman Sachs Growth, is set to join the deepwatch board. “The demand for managed security services is expected to grow as staffing and skill shortages, an ever-evolving threat landscape, and an increasing compliance burden lead companies of all sizes to offload their security needs to specialist providers like deepwatch,” said Morgan GerlakOpens a new window , Early and Growth Investor at Goldman Sachs Growth.  

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