Industrial cybersecurity startup Nozomi Networks has raised $100M in pre-initial public listing (IPO) funding. The capital injection will be used to scale product development and grow its sales and marketing operations.
The company, which specializes in operational technology (OT) and the Internet of things (IoT), provides cybersecurity solutions to specialist industrial hardware such as connected factory machines and oil pipelines.
The San Francisco-based organization caters to a range of industry verticals including manufacturing, oil and gas, mining, and pharmaceutical, among others.
Triangle Peak Partners, a private equity firm, led the Series D round. Other partners who provided backing were Forward Investments, Honeywell Ventures, In-Q-Tel, Keysight Technologies, Porsche Ventures, and Telefónica Ventures. All of Nozomi’s previous backers also contributed to the funding round.
“With the OT and IoT security market on the verge of explosive growth, Nozomi Networks has not only risen to the top but is strongly positioned to continue to outpace the market,” said Dain F. DeGroff, co-founding partner and president at Triangle Peak Partners.
Nozomi’s latest funding round follows a year after claims to have doubled its customer base and increased annual recurring revenue by 110%. Nozomi’s solutions monitor over 47 million OT, IoT, and IT devices globally.
Industrial hardware, which includes industrial and distributed control systems, often has a much longer lifespan than traditional IT products. Once these systems are deployed, it can be difficult to implement security patches. Nozomi’s software monitors industrial machines to pinpoint discrepancies that might indicate an attempted attack or security flaw.
The importance of industrial machines to the economy has made them a lucrative target for ransomware gangs. The Colonial Pipeline and JBS attackers stole $4.4M and $11M in ransom payments, respectively.
Recent research published by Nozomi showed vulnerabilities in the critical manufacturing sector rose by 148% in the first half of 2021.
According to GlobalData’s deals database, Nozomi Networks has previously raised $42.5M in funding, the most recent being a $30M Series C round in September 2018.
To date, Nozomi Networks has not provided valuation following the funding round and the timeframe for its IPO plans.
As ransomware attacks become more prevalent in the private sector, companies such as Nozomi Networks have an opportunity to ramp up cybersecurity, especially in industrial applications.