Cyberstarts, a venture capital fund that invests in early-stage cybersecurity startups, said Monday it had closed a second fund of $100 million.
The VC firm was founded in 2018 by Gili Raanan, with an initial fund of $54 million. To date, the fund has made six investments — including in Fireblocks, which has developed software to securely transfer assets across parties and wallets, and Axis Cybersecurity, which has built a cloud security platform — that have already raised an additional $33 million in follow-on rounds.
Investors in both of Cyberstarts funds include cybersecurity entrepreneurs Shlomo Kramer and Marius Nacht, founders of Israeli cybersecurity firm Check Point Software Technologies Ltd.; Mickey Boodai and Rakesh Loonkar, founders of Trusteer and Transmit Security; Nir Zuk, founder of cybersecurity firm Palo Alto Networks; Assaf Rappaport, founder of Adallom and Beyond Security and formerly the general manager of Microsoft’s development center in Israel; and Roy Zisapel of Radware.
The VC fund Sequoia, where Raanan is general partner, has also invested in the fund, according to a statement issued by Cyberstarts on Monday.
Lior Simon, a former investor at the VC fund Sequoia who set up Arbor Ventures Investments in Israel, has joined Cyberstarts as a partner, the statement added.
“The hunger for innovative cybersecurity solutions, particularly in times of crisis, is growing as a result of the rapid move to work-from-home, the growing transition to cloud computing and the push for automation for lowering operating costs,” said Raanan in the statement.
The fund recruits the services of chief information security officers at US companies including Starbucks, Home Depot, Walmart, and Zoom, to provide its portfolio companies with advice and insights regarding the development of their technologies.
Raanan, a veteran in Israel’s tech scene, started out in the Israeli Defense Forces 8200 intelligence unit, where he served for some ten years. He later founded Sanctum, an application security startup that later sold to IBM, and nLayers, which developed tech to analyze the behavior of heavy applications in databases of enterprises. nLayers was sold to EMC for $50 million in cash in 2006. Raanan is also one of the inventors behind the CAPTCHA security algorithm.
In 2009, Raanan joined Sequoia Israel as managing partner.