More Options: LogRhythm Rakes In $50M to Boost Cybersecurity Tech
LogRhythm, a Boulder, CO-based cybersecurity firm, wrapped up a $50 million round of financing Tuesday, Aug. 30, inching the tech company closer to a highly anticipated IPO.
The latest round brings the company’s total fundraising figure to about $120 million, according to Matt Winter, vice president of corporate and business development at LogRhythm.
“I think this round of financing provides us with the financial firepower to continue to invest in innovation and take our technology and the solutions we’re providing to customers to the next level,” Winter said. “And it gives us more firepower to continue to expand internationally.”
Despite claims that a previous Series E round in 2014, which netted about $40 million, would be the company’s final financing foray, Winter pointed to last summer’s sluggish tech market as part of the reason why LogRhythm went ahead with its latest round. He also did not rule out pursuing additional fundraising in the future.
“At this point, there are not plans to go off and raise another round,” Winter said. “We obviously have options and will continue to assess those options as our business requirements and opportunities evolve.”
Investors in LogRhythm’s new round include existing backer Riverwood Capital as well as Adams Street Partners, Siemens Venture Capital, and Delta-v Capital, according to a news release.
“We continue to be impressed with the company’s ability to drive technical innovation while simultaneously taking customer and market reach to new levels,” said Jeff Parks, founding partner of Riverwood Capital, in the release.
New investors EDBI (which serves as the corporate investment arm of the Singapore Economic Development Board), Exclusive Ventures, and Silver Lake Waterman also contributed to the latest fundraising sum.
The $50 million gain now has the 600-employee company—which has been helping clients deal with online threats and attacks since 2003—poised to launch a long-rumored IPO.
A July 25 report in Forbes said that LogRhythm could be one of several cyber-tech firms going public in the weeks and months after Labor Day. Earlier in July, LogRhythm hired Morgan Stanley and JPMorgan Chase & Co. to aid in the assembly of an IPO, according to reports by both Reuters and Bloomberg Technology.
However, Winter declined to comment on any potential timeline regarding his company’s IPO plans.
“We have taken note of those rumors, but we don’t really comment on them,” he said. “We’re in an enviable position in terms of having a lot of financing opportunities and avenues to pursue.”
Pending any LogRhythm stock hitting a public exchange, the firm will focus on tapping into an ongoing mental shift in the cybersecurity field, according to Andy Grolnick, president and CEO of LogRhythm.
“Organizations around the world recognize that advanced detection and response capabilities need to be at the core of their cyber security strategies, and IT security budgets continue to shift in this direction from a traditionally prevention-centric set of priorities,” Grolnick said in a statement. “LogRhythm has a tremendous opportunity ahead, as we become the platform of choice for powering customers’ next-generation security operation centers.”
Winter said that the company is particularly bullish on the emerging markets of Germany, the Nordics, the Benelux region, and the Middle East and Southeast Asia.
About 25 percent of LogRhythm’s business comes from markets outside of the U.S., according to Winter.
Global spending on information security is expected to hit $81.6 billion in 2016, which would mark a 7.9 percent increase over last year’s total, according to an August forecast report from Gartner.
Though LogRhythm has outposts peppered across the globe, Winter said the Front Range has emerged as an epicenter of the cybersecurity industry.
“The Front Range is carving out an impressive footprint,” he said. “If you look at companies like ourselves, Webroot, Ping Identity — there are some important leading cybersecurity businesses that call Colorado home.”