Security startup Tessian, which uses AI to fight social engineering, trousers $65M

This post was originally published by Natasha Lomas at TechCrunch

In the latest chunky funding round out of Europe, UK-based email security startup, Tessian, has closed $65 million in Series C funding. The startup applies machine learning to build individual behavior models for enterprise email use that aims to combat human error by flagging problematic patterns which could signify risky stuff is happening — such as phishing or data exfiltration.

The Series C round was led by March Capital. Existing investors Accel, Balderton Capital, Latitude and Sequoia Capital also participated, along with new investor Schroder Adveq.

The latest financing brings Tessian’s total raised to-date to $120M+, and values the company at $500M, it said today.

The 2013 founded startup last raised back in January 2019 when it closed a $40M Series B (news that was scooped by former TCer, Steve O’Hear). Prior to that it grabbed a $13M Series A in mid 2018.

Tessian has around 350 global customers at this stage, across the legal, financial services, healthcare and technology sectors — name-checking the likes of Affirm, Arm, Investec and RealPagem among them.

Over the past year there has been much coverage of the security risks associated with the pandemic-sparked remote working boom, as scores of white collars workers started logging on from home — expanding the attack surface area which enterprises needed to manage.

It’s a risk that’s been good for Tessian’s business: The startup says it tripled its Fortune 500-level customer base last year — “as enterprises required a solution that could protect them against human layer security threats”, as it puts it.

It says the new funding will go on expanding its platform’s capabilities; helping companies replace their secure email gateways and legacy data loss prevention solutions; and on growing its team (it plans to triple headcount in short order with a particular focus on growing its sales team in North America).

The Series C funds will also support a plan to expand beyond email to offer security protections for other interfaces such as messaging, web and collaboration platforms — which it says is on the cards “soon”.

Commenting on the round in a statement, Jamie Montgomery, co-founder and managing partner at March Capital said: “Human activity — whether inadvertent or malicious — is the leading cause of data breaches. In Tessian, we found a best-in-class solution that automatically stops threats in real-time, without disrupting the normal flow of business. It is rare to hear such overwhelmingly positive feedback from CISOs and business users alike. We came to the same conclusion; Tessian is rapidly emerging as the leader in human layer security for the enterprise.”

A number of UK-based AI security startups have been building momentum in recent years, with others like Red Shift and Senseon also getting traction by applying machine learning to tackle risks.

In April, Cambridge-based Darktrace — a category pioneer — led the pack by floating on the London Stock Exchange where it saw its shares pop 32% in the IPO debut.

While, last year, the UK government pledged to ramp up R&D spending on AI as part of a major defense spending hike.

Additionally from Venture Beat

Founded in 2013 as CheckRecipient before rebranding five years later, London-based Tessian solves a number of security headaches for enterprises like Arm, Prudential, Schroders, and Dentons.

Tessian | Enterprise Email Security Software | Human Layer Security

In its original guise, Tessian was largely focused on the misaddressed email problem, whereby a company employee accidentally sends an email to the wrong person. Using machine learning, Tessian scans its customers’ historical email data to spot patterns and then applies that knowledge to identify anomalies in current email activities — it’s designed to stop sensitive data landing in the wrong inbox.

Above: Tessian: “Human layer risk hub”

Attack vector

Tessian had previously raised around $59 million, and its latest cash injection saw return investments from Sequoia, Accel, Balderton Capital, and Latitude, as well as lead investor March Capital and Schroder Adveq. Tessian is now valued at $500 million.

Although companies face multiple security risks from just about every direction, insider (human) threats remain one of the biggest weaknesses, and email is one of the most consistently reliable attack vectors. Recent data from Trend Micro revealed that remote work increased high-risk email threats by 32% in 2020, with the bulk of the detected threats consisting of malicious URLs, phishing links, malware, and BEC attempts.

As Tessian notes, “employees are the gatekeepers to companies’ most sensitive systems and data,” which is why it’s expanding beyond email security into messaging and team collaboration platforms. Indeed, while email is alive and well across the business sphere, workers are using an ever-growing combination of tools to communicate internally and externally. Tessian stopped short of detailing which platforms it would support in the future, however.

But Tessian did note that it plans to double down on its email security credentials and help companies “replace their secure email gateways and legacy data loss prevention solutions,” according to a blog post.

Originally here

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This post was originally published by Natasha Lomas at TechCrunch

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