Raising a down round in the slowing venture market became a reality for another startup Monday.
Atlanta-based OneTrust raised a $150 million round led by new investor Generation Investment Management — co-founded by former Vice President Al Gore — with participation from existing investor Sands Capital at a $4.5 billion valuation.
The valuation represents about a 12% drop from the $5.1 billion valuation the privacy and security startup garnered after it raised a Series C in late 2020 and an extension in 2021.
Founded in 2016, OneTrust says it has now raised more than $1 billion.
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New normal
OneTrust, which helps companies manage privacy, security and governance requirements in the ever-changing regulatory environment, is far from the only unicorn that has raised a down round.
Big names such as Klarna and Stripe have done similar rounds as the venture market has continued to slow since its highs of 2021.
The fact that startups have had to settle for a down round may say more about how companies were overvalued in 2021 than any declining performance by the companies themselves.
OneTrust CEO Kabir Barday told Bloomberg the company has doubled annual recurring revenue to $400 million from 2021.
The company plans to use the new funding to meet growing customer demand. OneTrust has more than 14,000 customers globally.
“We are focused on delivering strong customer experiences and will continue to evolve our platform as our customers’ needs grow,” Barday said. “This funding is a testament to our sustained growth, market leadership, and customer-centric innovation.”
OneTrust was part of a growing world of compliance regulation startups — which included TrustArc and BigID — when it was founded. At the time, hundreds of new laws and regulations — such as Europe’s General Data Protection Regulation and the California Consumer Privacy Act — were being enacted and startups flocked to the sector.
Other investors in OneTrust include TCV, Insight Partners and Coatue.
Illustration: Dom Guzman
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