Logz.io, With Backers in Boston & Israel, Aims to Sniff Out IT Bugs

If you had trouble streaming a video on Netflix or posting in a Reddit thread on Sept. 20, you can thank an Amazon Web Services outage that impacted a number of apps and websites for a few hours.

These types of outages are only minor annoyances for most people, but they can have real effects on companies’ bottom lines (including Amazon’s) by disrupting online transactions or other business operations.

Add Logz.io to the army of companies offering services aimed at tracking what’s going on behind the scenes with websites, apps, and other software—and trying to predict when costly malfunctions could occur.

The startup was founded in late 2014 by two Israel natives and employs 20 people at its headquarters in Tel Aviv, Israel, and a satellite office in New York. It publicly launched its service today and announced that it has raised $8 million from investors.

That money includes a $6.8 million Series A round led by 83North, which has offices in the U.K. and Israel, with participation by Israel-based Giza Venture Capital. Logz.io had previously raised $1.2 in seed money from Giza and angel investors, including David Chang, a Boston investor and former chief operating officer of PayPal Media Network.

Every machine that runs software—computers, smartphones, tablets, smart watches, servers, and more—keeps a running log of every action it takes. But with the flood of data that has accompanied the rise of mobile apps and cloud computing, effectively monitoring these logs is virtually impossible for a company’s IT staff to handle without aid.

“Even if you had an army of people, no one could actually read through these log lines” to try and find errors, says Logz.io co-founder and CEO Tomer Levy. Netflix logs 1 billion “events” per minute in its system, he adds.

That’s where companies like Splunk, Sumo Logic, and numerous others come in—they sell software that can track and analyze all of this activity for businesses, ideally helping to make their operations more productive and secure. Logz.io is trying to do the same thing, but in a different way than most companies in this sector, it says.

Logz.io takes open-source software—for you hardcore techies, it’s the Elasticsearch, Logstash, and Kibana (ELK) stack—and offers it as a cloud service for analyzing enterprise companies’ logs. ELK, for example, is used by the likes of Google, Facebook, Microsoft, Netflix, Goldman Sachs, and others, the company says.

On top of that, Logz.io has developed machine learning algorithms that study interactions users have with their log data and searches the Web for known software bugs, with the goal of parsing out the log events that are actually important for companies and their IT departments to know about.

“This is how you predict issues and solve issues in your environment,” Levy says in a phone interview. “We know how to listen to the story the data is telling.”

And customers are already buying the story that Logz.io is selling. Since rolling out its service to pilot users in June, it’s been signing up more than 100 companies per month. That includes “dozens” of paying customers, although Logz.io is not generating revenue from most of its users, Levy says.

Users include Infosys, an India-based consulting and IT services firm; Playbuzz, a New York-based company providing a free online publishing platform; and Paris-based Mirakl, which provides software for developing and running e-commerce marketplaces. Logz.io clients are mainly using its software for monitoring IT operations, keeping their software secure, and performing business analytics.

“We’re seeing very strong demand for these kind of solutions,” Levy says. “This is the reason we were able to close and secure the funding from very good VCs now and launch this company publicly.”

Levy was previously the co-founder and chief technology officer of Newton, MA-based IT management software provider Intigua. He lived in Israel, but split his time between Tel Aviv and the Boston area, he says. Before that, he held several roles with San Carlos, CA-based Check Point Software Technologies.

Levy’s co-founder and vice president of product, Asaf Yigal, co-founded Boston fintech company Currensee in 2007, which was acquired by San Francisco-based OANDA in 2013. Yigal, an Israeli Navy veteran, lived in Boston for 13 years before moving back to his home country in January, he says.

Logz.io says it recruited former VMware senior vice president and general manager Boaz Chalamish to its board, and it also hired senior engineers that used to work for Akamai, Check Point, Outbrain, and Israeli intelligence.

The venture funding will be used for product development and hiring, including adding sales, marketing, and customer support employees in the New York office, Logz.io says.

Jeff Engel is a senior editor at Xconomy. Email: jengel@xconomy.com Follow @JeffEngelXcon

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