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Austin’s Osano Gets $5.4M To Help Companies Comply With Changing Data Laws

On Jan. 1, 2020, new data privacy legislation called the California Consumer Privacy Act (CCPA) goes into effect.

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And one Austin-based startup with the mission of helping companies – from small-to-medium businesses (SMBs) to enterprises to Fortune 500s –get compliant with the act has just raised a $5.4 million Series A.

Founded in November 2018 by Arlo Gilbert and Scott Hertel, Osano says it’s “building the first platform for data privacy transparency.” Austin VC firms LiveOak Venture Partners and Next Coast Ventures co-led the round, which brings the company’s total raised since inception to $8.4 million. Individual investors include Indeed co-founder Rony Kahan, Bazaarvoice co-founder Brett Hurt, Pingboard co-founder Bill Boebel and new investors WP Engine founder Jason Cohen and Andrew Busey.

‘The Internet Has Been The Wild West’

In a phone conversation, Gilbert explained to me why Osano believes the CCPA is actually more of a national law.

“The law applies to California residents even if they are not physically in the state,” he said. “It’s impossible to know where everyone is at any given time. So it’s like the mattress tag law, you have to treat everyone as if they’re from California.”

Either way, getting compliant with the law is “really challenging,” according to Gilbert as companies for years have been operating under the premise that they didn’t have to do things like ask about data, or give people access to their data.“Companies didn’t build technology stacks to support that and the vast majority have buried their heads in the sand about it,” he told Crunchbase News. “But now they have to. For the last 25 years, the internet has been the Wild West. It’s gotten out of control.”

That’s where Osano comes in. The startup describes itself as “a turnkey data privacy platform that automates the process of data governance by automatically monitoring every single vendor sharing your business data across all websites.” Compliance is built into its workflow to meet the requirements of government regulations.

Osano offers an open source pop-up cookie tool for free that has been used by over 750,000 companies to secure 3.5 million websites. Operating under a similar model as Fortnite (the video game), Osano draws people in with that free tool and gives them the option to upgrade to more security for a monthly charge. This, of course, makes Osano a SaaS (Software as a service) company.

“With Fortnite, you can’t get good guns and cool tools unless you pay,” Gilbert said. “Similarly, our open source tool can do what you need but still requires a lot of time and development effort. Our commercial version just works. And that open source tool draws more than 1 million visitors a month to our website, so it’s also helping push people to our paid platform.”

That commercial version just launched in October and so far has 3,000 accounts, according to Osano.

Beyond The Game

But the company insists that its mission with the open source tool goes beyond just drawing users to its site. The company is actually a B Corp, which means that it is measured both by financial growth and the number of people whose lives benefit from its offerings. To Osano,  a safer internet for all should be a given.

“We wanted to create the company we always wished existed,” Gilbert told me. Osano is also a distributed company, with a completely remote workforce and a “heavy emphasis on diversity and having little environmental footprint.”

He and Hertel are a proven pair, having previously built and sold Meta SaaS, which sold in early 2018 to Flexera.

Osano co-founders Arlo Gilbert and Scott Hertel

The company plans to use its new capital to “go big and go fast.” That includes continuing to improve its product and build out a sales team. Currently, most of its staff are attorneys who “hand-review the data privacy practices of each third-party website vendor, ensuring care and accuracy for every single site.”

Venu Shamapant, founding partner at LiveOak Venture Partners, believes the opportunity is there.

“As laws like CCPA become commonplace, companies are scrambling to keep up with their vast networks of vendors. Osano is the right solution at the right time,” he said.

Illustration: Li-Anne Dias

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