Security management company Tanium gets $90M from a16z

This is Tanium's first venture funding, and Andreessen Horowitz's second largest investment ever

Financial trends and news by Steven Loeb
June 23, 2014
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In the past year, cyber security has become a major concern as numerous tech companies have been breached. And then there was the Heartbleed bug. As a result, I've seen a big increase in the number of cyber security companies to start raising big amounts of venture capital funding.

The latest is Tanium, which announced on Sunday that it raised $90 million in its first venture funding. The only money that the company seems to have raised before is $812 million, according to a document filed with the Securities and Exchange Commission in 2010.

This entire new round was financed by Andreessen Horowitz, and was the firm's second largest investment to date. Tanium says that it will use the funding to "support continued product innovation and company expansion.

A systems and security management company, Tanium calls itself the “central nervous system” for its enterprise customers. The company provides instant visibility and allows its customers IT departments to collect data and update machines across their network within seconds.

Features include incident response, information protection, unmanaged asset detection, software license management, audit and compliance, patch management and software distribution.

Tanium's current customers include half of the Fortune 100, five of the top 10 largest global banks and four of the top 10 global retailers.

In addition to the funding news, Tanium has also that Steven Sinofsky, board partner at Andreessen Horowitz, has been named to the board of directors of Tanium as well. He joins existing members that include Chairman David Hindawi, who is also the co-founder and CEO of Tanium ; Gordon Davidson, of Fenwick & West, LLP; Orion Hindawi, Tanium co-founder and CTO; Nathan Brill, and Morton Simonsen.

In a blog post, Sinofsky called Tanium, "a prime example of a modern enterprise software company — solving the new generation of today’s problems using skills and experience gained from being successful founders in the previous generation."

"At 16z, we love the opportunity to partner with enterprise companies that are either working to radically improve the way a given IT need is met with software — or transforming the IT landscape by re-creating or re-defining the traditional categories with unique software," he wrote. "Tanium is magical because does both."

The security space

Some companies that have been hacked in the last year include TwitterFacebookZendeskApple,  Microsoft,EvernoteSnapchatSkypeBitly and eBay.

That is not to mention the retail stores that were also hit, including Target, which may have affected 70 million customers who shopped there; Neiman Marcus, whose breach could have affected 1.1 million cards potentially affected, with 2,400 already being used fraudulently; and Michaels, which put 3 million cards at risk.

In January, the FBI released a report that said that a total of  20 cases of retailers being hacking had occurred in the past year

Not surprisingly, all of this has led to a rash of Internet security companies popping up and getting funded. Take a look at how many have raised money this year alone:

In February, cyber security company Shape Security raised $40 million in Series C funding; Cybereason, a platform that proactively detects, and stops, security threats emerged from stealth mode with $4.6 million;  cloud security company Elastica came out of stealth with $6.3 million; and cloud security company Apparity raised $8 million in an oversubscribed Series A round.

In March, Wickr, a communications app that focuses on security, raised $9 million in Series A funding. The company also began selling its security technology to app developers.

In addition, smart home security system Canary raised a $10 million Series A; Niara, a stealth enterprise security company, raised $9 million in funding; Verdasys, a security firm that specializes in endpoint data protection, raised $12 million; TrueVault, a healthcare app data security startup, raised $2.5 million in funding; network security startup Vectra Netoworks raised $17.8 million in funding; and Synack, a startup that has created a system to safely crowdsource security testing, raised $7.5 million in funding.

In addition, software security company Palo Alto Networks entered into an agreement to purchase Cyvera, a privately held cyber security company, for the price of around $200 million.

Watch this video for more info about what  Tanium does:

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