Team chat services such as Slack are experiencing rapid adoption in the enterprise, but some companies have been more hesitant to embrace the technology than others. Organizations with advanced data security needs, such as banks, can’t simply shift employee communications to an external platform running on hardware they don’t control.

It’s this market where Mattermost Inc. is working to carve out a niche for itself. The Palo Alto, California-based Slack rival today announced that it has raised a $50 million funding round led by Y Combinator for its security-conscious twist on team collaboration.

Mattermost provides an open-source messaging platform built to run on companies’ internal infrastructure. The service can be deployed in a public cloud such as Amazon Web Services or on on-premises hardware, behind the corporate firewall. That allows organizations to retain full control of employee communications and shield chat messages from prying eyes with the help of the existing security systems protecting their infrastructure.

Mattermost also packs its own built-in security features. The service protects messages with encryption, supports multifactor authentication and can be configured to delete sensitive items after a certain time period. For companies with distributed workforces, Mattermost provides the option to require that remote employees use a virtual private network to log in.

Aside from the heavier emphasis on security, Mattermost provides a user experience quite similar to what its better-known competitors offer. The service’s Slack-liked interface consists of a large chat window flanked by a side navigation menu that lists the team channels to which a user has access. It provides a search bar for finding files, message thread support, bots and other staple chat features. 

The fact that Mattermost is open-source means companies with more specialized needs can customize the interface for their needs. In today’s funding announcement, Mattermost Chief Executive Ian Tien (pictured, right) explained this open-source model is also a key element of the startup’s go-to-market strategy.

“Mattermost is developed in deep partnership with our contributor community,” Tien wrote. “They’ve started hundreds of open source projects based on Mattermost. There are over a thousand contributors to core Mattermost software, and every month through word-of-mouth over 10,000 Mattermost servers are downloaded.”

Among the organizations that have deployed Mattermost are Uber Technologies Inc., Samsung Electronics Co., NASA and the U.S. Department of Defense. Mattermost plans to use funding to further increase its platform’s appeal for privacy-conscious users. The startup will build new out security features, as well as more capabilities for managing chat environments and meeting data management regulations.

Mattermost has raised a total of $73.5 million in funding.

Photo: Mattermost