Endpoint Detection & Response (EDR) , Governance & Risk Management , Identity & Access Management

Huntress Lands $150M to Boost Posture, Recovery Capabilities

An SMB security stalwart founded by a U.S. Air Force veteran achieved unicorn status to enhance posture and recovery capabilities for endpoint and identity protection.

See Also: CyberArk 2024 Identity Security Threat Landscape Report

Huntress said the $150 million Series D round will allow the Baltimore-area company to double down on endpoint and identity-based security posture management and automated recovery products via either organic investment or M&A. The firm more than doubled its valuation to $1.5 billion in conjunction with the investment, making Huntress the second newly minted cybersecurity unicorn since June 2022.

"We're seeing a massive uptick in the pace that hackers are reaching both our partners and the small businesses they support," Huntress co-founder and CEO Kyle Hanslovan told Information Security Media Group. "And so, on my end, I'm really having to arm myself and say, 'All right, if these threat actors are going to reach businesses before us, we've got to rapidly expand.'"

The Series D funding round was led by Kleiner Perkins, Meritech Capital and Sapphire Ventures and comes just 13 months after Huntress closed a $60 million Series C investment led by Sapphire. Huntress started in 2015 and has been led since inception by Hanslovan, who spent seven years as an information assurance manager in the Air Force and nine years as a cyberwarfare operator in the Air National Guard (see: Huntress Raises $60M to Bring Managed Protection to Identity).

He said Huntress' 10-figure valuation is based on strong unit economics and scalability, reflecting not just market potential but the company's solid financial foundation as it nears $100 million of revenue. Hanslovan will prepare for an IPO by implementing robust financial systems and transparent operations to maintain agility and transparency even while adhering to the stringent public company regulations.

"Our valuation isn't based on licking a finger and touching the magical air like you're listening for the winds of 2021," Hanslovan said. "It's built on great unit economics, great scalability and extremely good efficiency."

How Huntress Plans to Put the $150M to Work

Hanslovan said the funding will allow Huntress to double down on and expand its product offerings, which include endpoint detection, digital identity security, and human education and protection. He said better hardening and managing endpoints and digital identities through security posture management will help prevent lateral movement by threat actors who've infiltrated an organization (see: The Rising Tide of Identity-Based Attacks).

Autonomous communication and coordination among products will streamline and enhance security operations, according to Hanslovan. He pointed to the importance of capabilities such as automatic threat detection and response, session resets and backup integration. AI can assist with threat detection and response as well as with automating routine tasks to reduce the workload on human operators, he said (see: Artificial Intelligence and the Talent Shortage in Security).

"Our magic is: We deliver those world-class humans at the price of a product, so you're not having to hire people, and you're not having to maintain them and keep them from going to another cybersecurity vendor," Hanslovan said. "It's delivering enterprise technology with enterprise humans at the price of an SMB product."

Huntress will release an SMB-focused SIEM later in the summer, Hanslovan said, and then the company will turn its attention to endpoint and identity security posture management, along with backup and recovery tools. Despite all the backup products on the market today, Hanslovan said, recovery tends to be a very manual process for organizations. Huntress wants to use automation and its own people to streamline recovery for SMBs.

"This decision for us was to do fully managed and build not only the EDR and the ITDR but even human products that are fully managed," Hanslovan said. "Everything we do at Huntress is going to continue, and that's a direct response to our partners saying, 'Help me with the staffing problem.'"

What Constitutes Success for Huntress

Hanslovan spoke about the need for Huntress to operate at the same pace as cybercriminals, who are constantly testing and iterating new methods to breach security defenses. By expanding their R&D efforts and integrating advanced features, Hanslovan said, Huntress aims to provide protection that keeps pace with these threats. The company will also examine M&A that can be integrated into the platform (see: Huntress Buys Security Training Provider Curricula for $22M).

"What's crystal clear is: Hackers themselves are not afraid to test, iterate and experiment," Hanslovan said. "And if we're not operating at the same pace they are, it's certain that this backbone of the world economy is not going to fare well. It's already going that direction. So, we have to do something to turn the tide."

Huntress plans to increase its educational initiatives to bridge the knowledge gap for managed service providers and small and midsized business clients, according to Hanslovan. Many businesses in the midmarket and below lack the knowledge needed to defend against issues such as adversarial use of ChatGPT to create malware, and Hanslovan said bridging this education gap is crucial for better security.

Key metrics for tracking the performance of Huntress' Series D investment include top-of-funnel reach, conversation rates, customer satisfaction and the volume of inbound requests, which historically plays a large role in shaping the product road map. At the same time, Hanslovan said, the company will focus on auditing finances and maturing internal systems to ensure it fulfills the stringent requirements of public markets.

"If I'm not reaching the masses, the millions of businesses out there - not just the 100,000-plus I have today - then I am falling short," Hanslovan said.