eSentire raises $47 million USD, will build new office in Waterloo

esentire

Cambridge-based eSentire has announced it has raised $47 million USD in funding led by majority investor Warburg Pincus, a global private equity firm, as well as minority investors Georgian Partners and Edison Partners.

“The raise boils down to eSentire’s expansion – building the facilities, technology, and the people structure to support more customers in more countries.”

 
eSentire’s managed detection and response (MDR) platform automates threat detection, using data and signals from users across network, cloud, endpoints, hybrid, and on-premises environments to provide visibility for security analysts. eSentire aims to modernize MDR through the application of a proprietary artificial intelligence for threat monitoring and advanced automation to enable its security experts to operate at machine scale, which the company said could help solve some of cybersecurity’s biggest challenges.

“Protecting the scale of information that is widely distributed across an organization’s infrastructure, endpoint, customers and supply chain partners requires the continued innovation of MDR by applying AI technology with expert analysts,” said eSentire CEO Kerry Bailey. “Today’s business leaders recognize the fiduciary responsibility of securing mission-critical information and eSentire has been committed to this responsibility since creating MDR.”

MDR is an outsourced service that provides companies with threat detection services and responds to threats once they are discovered. It also involves security providers who monitor networks, analyze incidents, and respond to security cases. eSentire has clients in various markets — including financial services firms, legal, extractive and healthcare organizations.

“Regardless of how [companies] choose to process or store their information, we’re basically watching and if they do get breached because for most of our customers it is a matter of they will get breached and when we’re there to actually respond and shut it down before it gets too bad,” James Yersh, Chief Administrative Officer at eSentire, told BetaKit.

Related: Cybersecurity is the Achilles’ heel of Canadian tech businesses

In August 2017, eSentire raised a nine-figure undisclosed growth equity investment from Warburg Pincus. The deal announced in 2017 was a recapitalization of eSentire’s business that allowed Warburg Pincus to buy in, and other original investors to cash out. After the 2017 deal with Warburg Pincus, eSentire brought in a new CEO, CMO, and CAO. The former CEO J. Paul Haynes and eSentire’s founder Eldon Sprickerhoff are still active in the business, operating as Chief Operating Officer and Chief Innovation Officer, respectively.

“It’s almost as if, post-acquisition, this [round] would be the first round,” Yersh said. “That’s the simplest way to think about it, because the clock was reset back in September 2017.”

In 2018, eSentire acquired Seattle-based Versive, a company that enables enterprises to map out cybersecurity capabilities and react quickly to attacks. Dan Deeth, Senior Manager of Corporate Communications for eSentire said this $47 million USD is net new cash for the business. The company also raised $27 million in 2016 from Edison Partners and Georgian Partners. The company’s total funding to date is undisclosed.

“The raise all boils down to eSentire[‘s] expansion,” Deeth told BetaKit in an email. “Building the facilities, technology, and the people structure to support more customers in more countries. With this investment, [the] Waterloo region will benefit from all three of those things.”

Deeth said the funds will go toward building a 65,000-sq. ft. office in Waterloo with a Security Operations Centre, attracting new staff to help develop AI and machine learning technology, and expansion into Europe, as Canada and the US have served as eSentire’s traditional market.

“eSentire is well positioned in the high-growth cybersecurity space to further accelerate MDR adoption and innovation as organizations look to solutions that provide end-to-end protection with the rising volume of data and threats penetrating IT environments,” said Cary J. Davis, Managing Director of Warburg Pincus. “eSentire has the opportunity to build on its category creator and leadership position. We look forward to continuing to work with Kerry Bailey and his seasoned leadership team.”

Image courtesy eSentire.

Isabelle Kirkwood

Isabelle Kirkwood

Writer, globetrotter, drone pilot & David Attenborough enthusiast