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Security-as-a-service startup StackPath nabs $180M, 4 acquisitions including MaxCDN

ICE Graveyard 25/07/2016 Ingrid Lunden

A mass migration of IT services to the cloud, coupled with a huge growth of connected devices, has created a perfect storm for security breaches with some 400 million malware attacks identified last year alone according to IDC. Now, a new hopeful called StackPath believes it might have the key (and size) to fighting malicious hackers once and for all.

The company is emerging out of stealth today with a whopping $180 million in funding plus four significant acquisitions right out of the gate — MaxCDN, Fireblade, Cloak and Staminus — to launch a security-as-a-service platform but also fill out its network with customers. MaxCDN alone brings 16,000 customers to the new startup, and Cloak brings 15,000.

The funding is led by $130 million from ABRY Partners, the big private equity firm, along with a further $30 million from unnamed “insiders” the company tells me. It’s not clear whether the acquisitions are being made out of that funding or if they are separate to this. The financial terms, and valuation of StackPath, are not being disclosed but we are trying to find out.

StackPath is not your ordinary security startup. For starters, it is founded by Lance Crosby — the founder and CEO of SoftLayer, which was acquired by IBM in 2013 for $2 billion, forming the basis of its new-wave cloud computing business. And second of all, is the company’s main premise. The company is banking on the premise of building a massive security platform, and going big with a flexible SaaS-style product, as a key part of how it tackles the issue of security.

There have been dozens of startups in the world of security that are taking completely new approaches to tacking the problem using new techniques around artificial intelligence, or inspired by military formations, for example, to help conceptualise and shape products.

StackPath sees opportunity in offering a variety of services in a climate where businesses are increasingly buying things like security software and other IT services on a pay-as-you-go basis, rather than large cash outlays for products on large contracts that might also include costly hardware (especially in the case of security services).

“The Internet is where the world does business. It may be the single most important utility supporting businesses today, yet we continue to overtax the ageing infrastructure and struggle to make it secure,” said Lance Crosby, CEO of StackPath, in a statement.

“The StackPath platform is an integrated response to a fragmented problem created by too many individual, appliance-based, bolt-on security solutions. It’s time to give businesses internet services that have security built in, not bolted on—so they can be reliable guardians of their most precious assets. We appreciate the support from Abry Partners as we continue our mission of building a path to a secure internet.”

Among other key hires at StackPath are Andrew Higginbotham, COO and president, who had been SVP of cloud and technology at CenturyLink; and Kim Sheehy, CFO, who joins from CyrusOne (CONE).

StackPath, of course, will be tapping into things like machine learning and more. Services will be delivered in the form of APIs, and in each case, the StackPath’s platform will ‘learn’ more about threats based on the data gathered through each of its services. “It effectively deputizes each service on the host network with the authority to identify and communicate real-time threats against it to an intelligent data repository,” the company notes.

The company’s bigger vision is to create a platform to offer users a variety of different security services, but it says that it will start first with secure content delivery (using tech from MaxCDN, presumably).

This will launch in August and will be priced in tiers starting at $20 per user and per month, up to $600 per user per month, depending on aspects like bandwidth size, secure token numbers, and will include several features:

The four companies that have been acquired are bringing a range of services and customers into the mix, some of which will be made apparent more immediately than others, depending on the timing of new features that get launched:

MaxCDN is described as a “next generation content delivery network” that is built on Varnish and Nginx, and uses caching technology to accelerate websites and applications. And it is already a very established business: it has 19 global PoPs and more than 16,000 customers. StackPath says it has migrated this technology stack to its new platform with built-in security features such as WAF and DDOS.

Fireblade is a web application firewall provider originally founded in Israel that uses “a patented behavioral and data-driven approach to risk mitigation.” It processes traffic data in real-time and “pushes new conclusions and rules immediately to respond to emerging threats and botnet attacks.” Fireblade has already been integrated into StackPath’s platform, the company said.

Staminus is an anti-DDoS provides that already has a reputation in the market, as well as patents. While today its tech is based on appliances and a global network of scrubbing centers, StackPath says its DDoS mitigation capacities “have been completely integrated into StackPath’s PoP and network architecture to protect StackPath’s network and its customers from the largest and most sophisticated DDoS attacks.”

Lastly, Cloak — which actually quietly announced its acquisition back in April — is a leading consumer VPN platform with native iOS and Mac applications to allow people to securely use the internet while on untrusted networks, by way of encrypted tunnels. (Android and Windows are on the way, the company says.) This is especially useful in the current work environment where many people bring their own devices and use them to work. The company is very established, with 1 million downloads to date and 15,000 paying users. The company will help StackPath target both small/medium businesses as well as large enterprises.

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