The application security market is worth an estimated $7B, and protecting consumer information on the web or on mobile applications is a complete necessity – especially since vats of sensitive personal data is collected through everyday use of the internet like online banking or online shopping. One of the most sophisticated cyber security services being used by mid and large-size companies is Signal Sciences. This cybersecurity startup offers a WAF (Web Application Firewall) that is easy to deploy, works with any technology environment, and it requires absolutely no full-time oversight.
LA TechWatch sat down CEO and cofounder Andrew Peterson to chat about the state of security, Signal Sciences’ expansion, and recent round of funding, which brings its total funding to $61.7M across four rounds.
Who were your investors and how much did you raise?
We just raise a $35M Series C led by Lead Edge Capital. Lorrie Norrington, Operating Partner at Lead Edge Capital and former President of eBay and former Lead Board Director from Duo Security, has joined Signal Sciences’ Board of Directors.
Tell us about the product or Service Signal Sciences offers.
A WAF, or Web Application Firewall, helps protect websites and mobile apps (such as your online banking or shopping carts) by identifying and blocking malicious traffic to protect from hacks.
Why do web applications specifically need their own firewall protection?
There’s one key reason: web application attacks are the number one leading source of successful breaches. This is according to the 2018 Verizon Data Breach Investigations Report (DBIR), causing costly and sometimes devastating harm to businesses.
All companies are experiencing a growing application portfolio – that’s key to providing new and engaging experiences for your customers. But it also means that there’s more data to protect.
Companies today need active protection instead of passive signatures. You need coverage that provides a granular, application-specific defense without a lot of effort, and that’s what our next-gen WAF and RASP solution does.
What inspired you to start Signal Sciences?
My cofounders, Zane Lackey, Nick Galbreath, and I started Signal Sciences to solve the application security problem that we experienced first-hand as tech and security practitioners at Etsy.
Etsy has been a pioneer in the adoption of new technologies and software development processes like DevOps and CI/CD. Once we started building the security practice from the ground up, it was clear that legacy approaches to protecting our customer data were not going to work. Specifically, the legacy Web Application Firewall (WAF) technology that was designed to protect websites from the late 90s did not address the challenges facing the modern engineering teams we were working with.
It became clear that it wasn’t just forward-thinking startups like Etsy going through this technology shift, it was everyone. So we decided to take the lessons learned at Etsy and turn them into a technology company to help the industry with these same problems.
It became clear that it wasn’t just forward-thinking startups like Etsy going through this technology shift, it was everyone. So we decided to take the lessons learned at Etsy and turn them into a technology company to help the industry with these same problems.
How is Signal Sciences different?
Our next-gen WAF is different from legacy competitors, such as Imperva, F5, and Akamai in three core ways:
We’ve leveraged a patented split on-premises and cloud architecture to be able to both cover a much wider array of attack types and malicious behavior than any previous WAF technology, but we also identify those attacks at a new level of accuracy that was originally thought to be unattainable.
We automate the work so you don’t have to hire security specialists to make our technology effective. 95% of our customers are using our fully automated protection and not a single organization has hired a dedicated full-time employee to run the technology.
Our technology was designed with flexibility at its core to seamlessly work with any type of technology environment that our customers adopt (multi-clouds, containers, on-prem, etc.) to help them drive innovation without sacrificing security
What market is Signal Sciences targeting and how big is it?
Protecting mobile and website data (known as application security) is estimated at $7B market today, and it is the fastest growing segment of the security industry. We help any company who runs a web or mobile site and has information they’d like to protect- making the market almost any company today. We target large to mid-market companies across any vertical, including financial services, retail, healthcare, media and entertainment who need real-time visibility and protection against cyber threats, including web attacks, bots, scrapers, account take over and injection attacks, among others.
What’s your business model?
We have a software product that gets purchased as software as a service (SaaS), as well as a stellar professional services team providing white glove assistance to any client needing additional help and training.
What was the funding process like?
We’re so excited to have a late-stage funding group like Lead Edge Capital here in Southern California (the founder Mitchell Green is based in Santa Barbara). They’ve been tracking our progress for a while now and have been so helpful along the way that when it came time to raising this round both sides knew a good amount about one another and made the process pretty straight forward!
What are the biggest challenges that you faced while raising capital?
As you get to later stages in funding the business traction speaks for itself mostly, so a lot of the process comes down to figuring out if the investors share your conviction about the future of the business and the overall market. There’s a lot of “right place right time” things going on for us and our business and we’re thrilled to have Lead Edge along for the ride!
As you get to later stages in funding the business traction speaks for itself mostly, so a lot of the process comes down to figuring out if the investors share your conviction about the future of the business and the overall market. There’s a lot of “right place right time” things going on for us and our business and we’re thrilled to have Lead Edge along for the ride!
What factors about your business led your investors to write the check?
Customer traction, team, and market. We have an incredible team of technologists, salespeople, and marketers representing the best of enterprise software not just from LA but throughout the country.
Combine that with a security market where protecting websites and software is more important than ever and shifting rapidly. And you get the building blocks for some very exciting growth in our future.
What are the milestones you plan to achieve in the next six months?
We have exciting plans for the future and will be using the injection of capital to double down on innovation to continue to be the fastest growing application security company in the world. While we have the leading technology in the space today, both software development technology and web attacks continue to evolve. We’re committed to staying one step ahead on both fronts to keep our customers protected so they can focus on what they do best: building incredible businesses and innovating amazing web and mobile experiences.
What advice can you offer companies in Los Angeles that do not have a fresh injection of capital in the bank?
Keep cranking on the business and focus on getting tangible traction every day. LA is no longer a hidden market from a capital investment perspective and investors throughout the country have their eyes on the LA tech market. Focus on creating real business value and the investment will follow.
Where do you see Signal Sciences going now over the near term?
We believe our rapid customer growth and five-star Gartner reviews validate that we have, by far, the best WAF technology in a surging web app security market, and we’re using our funding to continue to build on that lead. We’re doubling down on engineering innovation and partnerships to deliver maximum security value for our customers as well as expanding key areas of our business to drive continued growth. This will be a massive year for Signal Sciences.
What is your favorite restaurant in LA?
I’m obsessed with Coni’s Seafood on Centinela right now. Amazing ceviche and authentic Mexican shrimp dishes. Not the best ambiance but if you’re after deep Mexican flavors and amazing seafood, it’s a must.
