It takes a lot to come back from a breach in Silicon Valley. Especially if you are a security company.
However, OneLogin, an access management-focused security company, has made its way back into the spotlight with $100 million in new funding. The growth financing round, announced today, was led by Greenspring Associates, a new investor for OneLogin. The company’s existing investors, including CRV and Scale Venture Partners, also participated. The company has raised more than $170 million in total known funding, according to the company.
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OneLogin’s CEO Brad Brooks is a Microsoft veteran and former Chief of Marketing, Product, and Engineering at Docusign. He told me that he made the jump to OneLogin in 2017 because access management technology is a ubiquitous need for businesses across industries.
“What’s changing is the entire infrastructure play about how IT departments run their technology stack within their corporate enterprise. It used to all be within their own data centers, or on their laptops,” Brooks explained. “Now that everything’s moved into the cloud, you’ve got to have some kind of central management capability that allows for you to manage the different applications.”
Brooks joined the team just a few months after the company experienced a serious AWS breach which exposed client data and led to a number of employees leaving the company.
“Everybody looked at me and said, What are you going to do? Are you going to shut this thing down and sell it or are you going to make a go of it?” Brooks told Crunchbase News, adding that to recover the company had to focus on tackling short term wins.
“The pipeline had completely dried up,” he explained. “Customers didn’t leave us, but they weren’t expanding their interest in us in terms of bringing us into new use cases or putting us more broadly across their environments.”
Fast forward to about a year later and the company launched a new “unified access management” software. The product includes single sign-on and multi-factor authentication services which can be set by companies’ individual security requirements. Brooks says that what sets OneLogin apart from its competitors, is that its service manages both companies’ on-premise and cloud applications.
“It’s not just about access to cloud applications and data, it’s access to everything, whether it’s walking through the front door to your business in the morning, to your enterprise applications, to your cloud applications,” he said.
But, OneLogin is up against stiff competition including tech giants like Microsoft, security-focused companies like Duo Security, and others. One of its main competitors, Okta, went public last year in a well-performing debut which Brooks says validated the size of the market in a public forum.
“It also says, all right, is your value proposition unique enough in the marketplace to actually survive amongst these other players out there, or are the larger players going to be able to just grow at a pace that you can’t keep up with?” Brooks said, again pointing to OneLogin’s unified access management solution as a major differentiator.
With an improved product, Brooks leaned on his SaaS experience to focus on securing larger contracts while investing in service capabilities to fit the needs of enterprise customers.
“Big companies need cloud too. They were the laggards coming into the marketplace, which is kind of why OneLogin focused on the SMB space or born-in-the-cloud type of companies,” Brooks expressed. “We went in a very different type of approach that starting about 18 [or] 19 months ago and started going for these much larger enterprise accounts.”
And while Brooks said the company is savoring its private privilege and not releasing specific ARR metrics, he did say that the company is “up to 70 plus customers that are paying well above $100,000 in ARR,” and that revenue is up 100 percent year-over-year from Q4 2017 to Q4 2018, partially due to upsells for existing clients as well.
With its new capital, OneLogin, which already has a significant presence in Europe, will open new offices and score new private and public-sector clients.
“Based on our run rates right now… we’ve got at least a good three years ahead of us before we’re going to need to do any kind of raising again,” Brooks said.
In a security market filled with deep-pocketed competitors, a well-stocked bank account to last through a potential venture drought is likely welcome and rewarding news for those employees that weathered the storm.
Illustration Credit: Li-Anne Dias