BitGlass Raises $25M Round to Make Using Cloud Apps More Secure

8/5/14Follow @MichaelXBD

We’re well into the era of cloud applications and “bring your own device,” and yet securing data on smartphones and tablets remains a major challenge for businesses, their IT teams, and their employees. While it’s a big headache for them, it’s also becoming clear just how big an opportunity it is if IT security companies can solve such problems.

BitGlass is one of the latest startups to enter the market, having emerged from stealth earlier this year. The Campbell, CA-based company announced Tuesday it has raised a $25 million Series B round. The latest investment brings the total amount of venture capital raised by BitGlass to $35 million.

New investors include SingTel Innov8, the venture investment branch of the SingTel Group, a Singapore-based telecom. New Enterprise Associates and Norwest Venture Partners also invested, following up on their investment in the Series A round.

BitGlass’s approach is to protect data as it travels from mobile devices through the third-party servers and networks that cloud apps like Salesforce.com, Dropbox, and Google Apps use.

To the chagrin of corporate IT departments, those connections take place beyond the reach of security systems that rely on technology and strategies developed before the cloud and pre-mobile device era.

That’s why security remains the biggest barrier keeping companies, especially large enterprises, from fully adopting cloud apps and allowing employees to use their own devices, according to Rich Campagna, BitGlass’s vice president of product and marketing.

Enterprises need to know who is accessing their critical data, what they’re doing with it, and to make sure it’s encrypted and protected from unauthorized users. For the most part, they can’t, Campagna said.

BitGlass works by routing users and their traffic through its security products when they log in to a cloud app. The technology protects the data while it’s in transit.

“When an employee connects to Salesforce.com, there’s no traditional network infrastructure that belongs to the enterprise in the middle of that transaction. The organization is typically blind to what’s going on there, and they have no ability to protect their data,” he said. “We’ve built this infrastructure that allows us to ensure that all that traffic, all that data, going between any device and whatever cloud application, we’re able to funnel that through the BitGlass service.”

That gives BitGlass customers the ability to see what’s happening and to put security measures in place, Campagna said.

BitGlass’s goal is to be as invisible as possible to users and it doesn’t require them to download and use a BitGlass client app on their devices. Instead, when a user starts a cloud app, BitGlass reroutes their traffic through its own secure proxy.

“When an enterprise user goes to authenticate on one of these applications, which happens each time they try to access the application, we’ve built these mechanisms that allow that application to redirect the user over to us,” Campagna said.

Users shouldn’t notice a thing while logged into the app, but BitGlass will be able to monitor their activity on behalf of their companies to watch out for suspicious behavior.

“Sitting in the central path, we see all the traffic and are able to perform all these transformations on the enterprise data in both directions, either toward the cloud or down toward the device,” Campagna said.

The transformations include digitally watermarking files so BitGlass will know whenever they’re accessed. That allows companies to track files after they’re downloaded and to make sure employees don’t deliberately or inadvertently pass them on to the wrong people.

In BitGlass’s eyes, its security measures should make enterprises confident everything’s secure, while their employees will become more productive and happier because they can use their own devices with little interference.

But employees could benefit in another way. BitGlass says its products are able to differentiate between when a user logs in to their personal or work accounts, which protects employees’ privacy. When corporate data needs to be wiped off a device, BitGlass is able to do it without touching users’ private data.

A number of startups have been working on securing cloud apps and mobile devices. Examples include OneLogin and Ping Identity, which both specialize in single sign-on software that authenticates users and manages access to cloud apps. BitGlass views single sign-on as a key piece of cloud security, and offers it to clients, but also works with other SSO products.

“They’re the gatekeeper that determines if you’re somebody that we should allow into this application,” Campagna said. “They essentially pass over to us responsibility after the user is logged in, and from there we provide security for the data. They’re both critical functions.”

While the market for cloud apps and mobile devices continues to develop, it’s pretty clear they’re part of a lasting transition. Campagna wouldn’t put a number on it, but BitGlass is confident it will be huge market in the near future.

“Organizations aren’t going to move 100 percent to cloud, 100 percent to mobile overnight, it will take a long period of time, but certainly this new era,” Campagna said.

BitGlass thinks it has potential customers in every major industry, especially those that are constrained by heavy regulations intended to protect consumer privacy.

“These types of problems apply to customers in every major vertical. In some cases, these security concerns are an absolute inhibitor to adoption,” Campagna said. “We have a lot of traction in healthcare and financial services with folks in heavily regulated industries who aren’t otherwise able to move to cloud apps and BYOD at all. They want to move, but they just can’t.”

Michael Davidson is the editor of Xconomy Boulder/Denver. He covers startups, venture capital, clean tech, energy, aerospace, telecoms, and whatever else happens above 5,280 feet. Contact him at mdavidson@xconomy.com. Follow @MichaelXBD

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