Recent trends in venture capital investment within the cybersecurity market indicate a decline, particularly in the past few months. According to data from Crunchbase, the number of cybersecurity deals dropped from 181 in Q2 to 153 in Q3. Crunchbase’s detailed report reveals a 30% decrease in cybersecurity venture funding during Q3 compared to the same period last year, potentially reaching the lowest levels since 2019.
Despite the overall downturn, certain cybersecurity startups, such as Opal Security, are managing to thrive. Opal, specializing in automated identity access management, recently secured $22 million in a Series B funding round led by Battery Ventures, with participation from Greylock and Box Group. This brings Opal’s total funding to $32 million. The additional funds will be allocated to doubling Opal’s team by the end of 2024, expanding enterprise customer support, and enhancing product development. Opal’s CEO, Umaimah Khan, disclosed plans to introduce new visualization and AI-powered tools focused on addressing identity and access risks.
Founded in 2020 by Khan, Opal was born out of his experiences in cryptography at MIT and various roles in defense research and startups. Khan noticed common challenges related to visibility and user access behavior during his time in both public and private sectors. Recognizing the need for a scalable access and identity orchestration platform, he established Opal to provide companies with a consolidated view and control over employee access to internal tools, apps, platforms, and environments.
Opal faces competition from established players like Okta, as well as competitors like Veza, SailPoint, Cyber-Ark, and Saviynt, many of which have received significant venture capital. Khan distinguishes Opal by emphasizing its foundation for analytics and AI features aimed at preventing identity-based threats. Opal’s data platform, offering granular insights into system policies, users, and groups, sets it apart in risk assessment and anomaly detection.
Opal’s success is reflected in its fourfold increase in annual recurring revenue since the Series A funding in June 2022, serving around 40 brands, including Databricks, Scale AI, and Figma. While Khan didn’t disclose Opal’s profitability, he highlighted its role in addressing challenges in scaling access management in complex enterprise environments. Opal’s platform, designed for usability and scalability in identity access management, aligns with the evolving needs of organizations amid the ongoing market challenges. Additionally, regulatory developments, such as the U.S. Securities and Exchange Commission’s new rule on rapid disclosure of cybersecurity incidents, are seen as positive factors for Opal in the cybersecurity landscape. The latest funding round positions Opal to navigate market challenges and invest significantly in team and product development.
