As cloud adoption moves from being something of a quirky niche that only the coolest of companies use, to a mainstream way of delivering IT, there are a burgeoning number of peripheral services sprouting up. While cloud software and infrastructure are the core components of cloud IT, such functional areas as authentication, integration, security and monitoring all need to be delivered in a cloudy way. A host of startups are making the bet that traditional solutions in these areas will not be sufficient to deliver on the needs of cloud users and are setting up “cloud-first” solutions.
One space that is particularly bus is that of cloud application analytics and security. Broadly speaking, all these vendors deliver a solution that allows enterprises to gain visibility over the different cloud solutions that are in use within their organization, and to apply a series of policies to set and enforce usage rules – companies like SkyHigh Networks, CipherCloud and Netskope fall into this category.
Netskpe is today announcing a $35M Series C funding round being led by Accel partners alongside participation by existing VCs Lightspeed Venture Partners and Social+Capital Partnership. This is a sizeable investment considering the company was only launched around six months ago. Since that time it reports that it has “been working with” (read: they’re not yet paying customers) more than 100 companies from nearly every major industry, including healthcare, financial services, high tech and retail. Total funding to date is over $55M.
Netskope has also got a very beefy headcount given its age – it now sits at 100 employees and has done time around the industry analyst community – Gartner recently recognized them as a “Cool Vendor”, while no indication of eventual success, this recognition is an indication that Netskope is heading in the right direction.
In something of a justification for its existence, the most recent copy of the Netskope Cloud Report found that enterprises ran an average of 461 cloud apps during the first quarter of 2014, 85 percent of which were not enterprise-ready. While the definition of “enterprise ready” might differ from place to place, the fact that there is this much cloud use, much of which is unsanctioned, indicated that at least in terms of Discovery of application usage, there is a real opportunity here. Sanjay Beri, CEO of Netskope puts it clearly when he says that:
As workers demand more effective tools to do their jobs, it’s inevitable more cloud apps will be introduced to the enterprise without IT’s knowledge. Our vision is to help CIOs tackle the accelerating shadow IT conundrum with detailed real-time insights on how every cloud app is being used and enabling them to enforce well-informed granular policies that encourage smart cloud app usage, rather than simply blocking or allowing certain apps.
That combination of enabling employees to use the right tools for the job, but within a construct of security and adherence to policy, is a powerful notion. It is clear that there is a real market opportunity here that the current crop of entrants will no doubt fight fiercely over.