Investments in Verdasys, Bit9 Add to Funding Pot for Boston-Area Security Firms

4/12/11Follow @xconomy

It’s a good time to be in the security software business, or so it seems.

Two area firms working on enterprise-level security and endpoint security to protect against cyber attacks and malware announced some big funding rounds today. The deal announcements come less than a month after RSA Security, a Bedford, MA-based division of EMC (NYSE: EMC) announced it was the target of a cyber attack, some of which related to its authentication products used by companies and governments. Weeks later EMC announced it was buying another security startup, NetWitness, which does monitoring and network analysis. The two companies announcing their funding today, Bit9 and Verdasys, are just a slice of the Boston-area cyber security cluster that also includes Fidelis, Cyber-Ark, Veracode, and NitroSecurity.

—Verdasys, a Waltham, MA-based maker of enterprise-level security software, said it raised $15 million from the GE Pension Trust, advised by GE Asset Management. The money will go to expanding its products for mobile and cloud security platforms, hiring, and adding distribution channels. “We have been impressed with Verdasys’ foresight to broadly define the Enterprise Information Protection market and deliver the leading integrated platform that meets the needs of that market,” said Anandh Hari, vice president of private equity at GE Asset Management, in the announcement of the deal. “The Digital Guardian platform offers the insight and capability to discover and then control sensitive data across a global enterprise and in doing so enables organizations to be more collaborative and therefore more competitive.”

—Bit9, a endpoint security technology developer, also in Waltham, announced it had pinned down $12.5 million in funding, making a total of $23 million raised by the company in the last year. The deal was led by founding investor Atlas Venture, and included existing Bit9 backers Highland Capital Partners, Kleiner Perkins Caufield & Byers, and .406 Ventures, as well as new investor Paul Capital. Bit9 said it will use the money for new product development, sales and marketing, and expansion into Europe.

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