The digital identity space is on fire.
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This morning, another digital identity provider has announced a significant round of funding. ForgeRock, which is based in San Francisco with an office in Norway, has closed on a $93.5 million Series E financing.
Riverwood Capital led the round, which included participation from existing backers Accel, Meritech Capital, Foundation Capital and KKR Growth. The fresh funds brings ForgeRock’s total raised since its 2010 inception to over $230 million, according to Crunchbase data.
According to research firm Gartner, the digital identity market is estimated at $16 billion with a 13 percent annual growth rate.
ForgeRock’s AI-driven platform aims to empower organizations “to create amazing digital experiences for both workforce and consumer segments, as well as things,” according to ForgeRock CEO Fran Rosch. Essentially, ForgeRock has combined advanced AI with an identity management platform in an effort to reduce the risk that comes with a growing remote workforce and to support an increasingly digital customer base.
The need for its offerings have become more pronounced, he said, in the wake of the COVID-19 pandemic with the recent surge in remote work and e-commerce.
“To be competitive today, companies need to deepen their relationships with their customers and improve the productivity and connectivity of their workforce,” he said.
More than 1,100 organizations use its “Identity Cloud” platform, according to Rosch. They include BBC, Toyota, BMW, Deloitte, Allianz, the state of Utah and Vodafone. The company says its annual recurring revenue is “north of $100 million” with a year-over-year growth rate of 75 percent in 2019. Rosch said ForgeRock has plans to only accelerate its growth as it ‘moves toward an IPO.’ ” He would not disclose at what valuation the company raised its latest financing, only to say it was “an up round.” ForgeRock currently has 630 employees.
Closing during a pandemic
Interestingly, ForgeRock signed the term sheet before the pandemic “really got going.”
“By the time we were set to close, we were right in the middle of it,” Rosch told Crunchbase News. “Our ability to successfully complete this round was a testament to this market opportunity around digital transformation and identity, and our position.”
Last year, the company added new products; identity governance and autonomous identity that use artificial intelligence and machine learning to help customers make smarter identity decisions. Its products are also designed to help organizations create better identity experiences for their customers and employees.
Operating as a software-as-a-service (SaaS) business, the company uses AI to automate activities such as approving access requests, performing certifications and predicting what access should be provisioned to users.
“We start small with our customers and expand,” Rosch told Crunchbase News. “We don’t ask for multiyear commitments. We just ask them to buy what they need today and grow with us.”
Fifty percent of the company’s revenue comes from the U.S. market, and 40 percent from Europe (the company originated in Norway). Rosch predicts more revenue coming from the public and financial services sectors as more activities move online.
Riverwood Capital co-founder and managing partner Jeff Parks will join the ForgeRock board of directors as part of the funding. The company plans to use its new capital to invest in R&D and cloud, and to beef up its sales and marketing efforts.
ForgeRock plans to also use the money to complete its migration to the cloud and to continue to invest in AI to make its platform “smarter and smarter.” Additionally, it will work to expand within its existing customer base.
As for a potential IPO, Rosch says time will tell, especially considering the impact of COVID-19. But the company is looking at the end of 2021 or the first half of 2022 as a logical time.
Illustration: Li-Anne Dias