Lacework on Thursday announced a massive $1.3 billion Series D funding round that propelled its valuation to $8.3 billion.
The company will use the funding to grow its R&D organization, make more acquisitions, hire additional staff, and expand its operations in Asia Pacific, Europe, the Middle East and Africa, said Meg Diaz, vice president of platform and solutions marketing at Lacework.
Diaz said if and when Lacework makes more acquisitions, they will be similar to the recent one of infrastructure-as-code company Soluble, which seeks to add automation capabilities to Lacework’s Cloud Security Platform.
“Our focus on acquisitions is solely around strategic investments that make sense for our platform and company,” Diaz said. “Soluble is a great example of this — it’s a fantastic technology that fits well with our platform and a great team that shares our vision for how security must change to meet the demands of cloud-first infrastructure.”
When asked if he thought this large round of funding would lead to similar high-priced rounds, Frank Dickson, program vice president for security and trust at IDC, was unconvinced this would continue, saying that addressing security problems requires scale, which favors companies such as Microsoft, Cisco, and IBM.
“Integration of start-ups by larger players will be the norm moving forward,” Dickson said. “Lacework’s funding is likely an anomaly. However, there’s a growing need for organizations like Lacework that look at cloud security through a new lens and adapt data-driven technologies that enable security efficacy and delivery efficiency. Lacework is trying to solve a really big problem: The IT complexity created by hybrid and multi-cloud deployments makes for a Herculean problem. To solve such problems and create market momentum, intuitively, it makes sense that it would require a corresponding Herculean amount of money ... they got that.”
Lacework’s $8.3 billion valuation now ranks third behind Tanium at $9 billion and Snyk at $8.5 billion.