CNBC Disruptor 50

25. Lacework

Founders: Vikram Kapoor, Mike Speiser, Sanjay Kalra
Co-CEOs: David Hatfield, Jay Parikh
Launched: 2015
Headquarters: San Jose, California
Funding:
$1.8 billion
Valuation: $8.3 billion
Key technologies:
Artificial intelligence, cloud computing, machine learning, software-defined security
Industry:
Cybersecurity
Previous appearances on Disruptor 50 List: 0

Persephone Kavallines

At a time when workloads are moving to the cloud, attacks are becoming increasingly sophisticated, and businesses are prioritizing spending on cyber technology defense systems.     

When a vicious cyberattack on software in servers and the cloud occurred in late December, it immediately set off alarm bells to identify and stop it. It was a zero day attack, an unknown security risk in computer software where no patch exists yet.

Data-driven cloud security company Lacework, through its regular scans to monitor any unexpected vulnerabilities, got an alert out right away about the threat, informing customers about the scope of the problem and what systems were impacted. It also provided guidance on fixes without impacting operations or causing downtime, and patches to prevent further attacks.

It's this safety net and speed of response that helped Lacework achieve three times revenue growth during 2021, and sizeable funding to continue fine-tuning its cybersecurity offering, Polygraph Data Platform.   

Global spending on the information security segment of cybersecurity is forecast by Gartner to grow by 12.4% to $170.4 billion in 2022. A research study by IDC recently found that nearly all organizations have encountered at least one cloud data breach in the previous 18 months.

In this expanding market, Lacework competes with companies like publicly traded CrowdStrike and Palo Alto Networks in addition to start-up Snyk, a security vendor using open source code.

Lacework relies on a patented form of machine learning built specifically within the cloud to protect an organization from the inside out. This approach provides insights internally to automatically learn patterns, flag deviations and provide alerts at the right time, without wasted time investigating false positives. As the platform ingests more data, it gains a better understanding of normal activities and is able to improve detections of malicious behavior or vulnerabilities.

Lacework prides itself on a comprehensive cybersecurity service that can be accessed from a single platform across Amazon Web Services, Microsoft Azure and other cloud computing services. Its product offerings have recently been integrated with data cloud company Snowflake in a go-to-market partnership. Additionally, in 2021, Lacework made its first acquisition, purchasing Soluble, a vendor of cloud infrastructure management.  

To continue scaling up, Lacework raised a $525 million Series C investment led by Sutter Hill Ventures and Altimeter Capital in early 2021. That was followed up in November with a $1.3 billion investment at an $8.3 billion valuation, which included Google Ventures as an investor. With GV on board, Lacework made its Polygraph Data Platform available within Google Cloud.

Founded in 2015 in San Jose, Lacework has grown to more than 700 employees. It's expanding internationally, with the European market seeing good traction while a push into Asia Pacific is picking up. The start-up also has been adding to its executive bench, hiring Jay Parikh, former Facebook vice president of engineering, as co-CEO alongside David Hatfield. 

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