A Cambridge cybersecurity startup that's full of spies just raised $65 million

Dave Palmer DarktraceDarktraceDarktrace director of technology Dave Palmer has worked at GCHQ and MI5.

Darktrace, a cybersecurity startup founded in Cambridge, has raised $65 million (£50 million) in a funding round led by private equity giant KKR.

The company, which announced the funding on Wednesday, was also backed by existing investor Summit Partners and new investors TenEleven Ventures and SoftBank.

TechCrunch reports that Darktrace raised the Series C funding round at a valuation of more than $400 million (£309 million).

Founded in 2013, Darktrace has developed software that helps organisations detect unusual behaviour on their network. The company’s technology, which can spot strange email activity and suspicious file uploads, is underpinned by complex maths that was developed at Cambridge University.

Darktrace, which employs 300 people across more than 20 offices, is well known for drawing on the talent that comes out of the intelligence agencies in the US and the UK. It has hired several people that have worked at MI5, MI6, GCHQ, the CIA, and the FBI. Darktrace’s former CEO, for example, was Andrew France, the former deputy director for cyber defence operations at GCHQ, while Darktrace’s director of technology, Dave Palmer, spent 13 years helping MI5 and GCHQ to build and maintain their global networks.

The company — first backed by Autonomy billionaire Mike Lynch in 2013 — said it plans to use the funding to accelerate the roll-out of its technology.

Companies lose over $400 billion (£309 billion) a year to cybercriminals, according to a insurance giant Lloyds.

In a bid to minimise their risk, more than 1,000 businesses are using Darktrace’s “Enterprise Immune System” technology, the company said, adding that they span financial services, telecommunications networks, legal firms, retailers, technology companies, government organisations, and critical national infrastructure facilities.

Darktrace Threat VisualiserDarktraceDarktrace’s ‘Threat Visualiser’ shows which bits of the network are under attack and where the attacks are coming from.

Nicole Eagan, CEO of Darktrace, said in a statement: “Securing the backing of another leading global investor like KKR is an important milestone for Darktrace and a strong validation of the technology we have developed. We chose to partner with KKR because of their unique global network to support our international expansion and rich history of enterprise building in the technology sector.

“In addition to KKR, we are excited to work with our new investors TenEleven Ventures and SoftBank who will contribute significant strategic value and knowledge to our team. We are also pleased to have the continued support of Summit Partners, who have been of tremendous help to us since their initial investment. With such a group of world-class investors we have an incredibly strong base to realise our full potential.”

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