Fortanix Raises USD 90M to Fuel Leadership in the Data Security Market

Highlights –

• Fortanix is at the forefront of the confidential computing movement, a term used for encryption technology for data being processed.
• Fortanix’s tools protect against a wide range of threats. It includes a self-protecting critical management service that keeps passwords, encryption keys, and certificates safe.

Fortanix Inc, a cybersecurity startup and a leader in secure computing, announced that it had closed a huge USD 90 million round of funding. This brings the total amount raised by it to USD 122 million.

Growth Equity, a part of Goldman Sachs Asset Management, led the Series C round of funding. Existing investors such as Foundation Capital, Giantleap Capital, Intel Capital, Neotribe Ventures, and In-Q-Tel participated.

Fortanix is at the forefront of the confidential computing movement, a term used for encryption technology for data being processed. Most data tools already offer strong encryption for data sitting idle on a server or being sent across a network. However, when an application uses information, it must be decrypted back into its original, readable form. This allows hackers to steal the data as it is being used, and Fortanix is trying to fix just this.

The company’s main product is the Confidential Computing Platform, which uses Intel’s SGX technology, built with modern data center processors. SGX lets you separate parts of a server’s memory into separate areas called enclaves that are not connected to the rest of the machine.

These enclaves cannot be accessed by not just the other workloads but also the hypervisor that manages hardware resources and even the operating system. At the same time, companies can still check the protected memory contents for possible malicious modifications.

With Fortanix’s platform, users can create encrypted environments to run cloud applications that take advantage of SGX without making much code changes. Fortanix thinks that companies can quickly move their current workloads into a secure environment and keep using the same orchestration tools they were using before.

Fortanix’s tools – a self-protecting critical management service to keep passwords, encryption keys, and certificates safe – protect against a wide range of threats. They allow applications to access data freely without letting anyone access them. So even if a hacker gets access to the operating system as an administrator, they won’t be able to see the information stored in it.

Soumya Rajamani, Vice President at Goldman Sachs who will be joining Fortanix’s board of directors, said that he is always looking to invest in companies with disruptive technologies and has seen how Fortanix’s data-first approach helps businesses. “Many businesses can relate to the challenge of data security and privacy,” he said.

Holger Mueller of Constellation Research Inc said, “Security is key for the success of digital transformation in the multi-cloud world. Companies know this and look for innovative, cloud-independent solutions. Fortanix is such a solution and has made impressive progress in the last quarter, which is now honored by another investment round. We will see where this takes Fortanix in the next few months.”

Fortanix says it has enjoyed “significant and sustained growth” since its last big funding round in 2019, despite the COVID-19 pandemic and recent economic problems. It says it has gained customers in many industries, including some of the most heavily regulated ones. This lets them follow privacy laws like Europe’s General Data Protection Regulation and Schrems II and U.S. standards like HIPAA, PCI, and ITAR. Fortanix said that adding these customers has helped it grow its revenue by more than 500% in the last three years, but it didn’t reveal the exact numbers.

The company has also been working hard to add more features to its runtime encryption platform. Over the past year, it has announced updates, including new blockchain security tools and tokenization capabilities for Snowflake Inc’s cloud data warehouse. Last year, it announced Fortanix Confidential Artificial Intelligence (AI), a special service that allows to use sensitive data, such as healthcare records, for AI training.

“Cybersecurity is one of the most important needs of our current era,” said Fortanix co-founder and Chief Executive Ambuj Kumar. “This fundraise is a strong validation of the massive market opportunity ahead as we execute our bold mission.”