Claroty Ltd. today announced that it has raised $140 million from investors in what it says is the largest-ever funding round for an industrial cybersecurity company.

The round, led by Bessemer Venture Partners and 40 North, follows a year in which Claroty saw new annual recurring revenues jump 133%, off an undisclosed base. The number of companies using its software doubled in the same time frame. The startup’s customers include Pfizer Inc., General Motors Co. and industrial giant Schneider Electric SE, to name a few. 

Claroty provides a cybersecurity platform tuned to the highly specialized requirements of industrial infrastructure such as factory control systems. The platform covers three main use cases: finding vulnerable devices, detecting malware and allowing administrators to securely access industrial hardware over the network. 

Finding vulnerable devices is a particular challenge in industrial environments such as factories because the most important hardware is often isolated from the rest of the network. That makes it more difficult for hackers to compromise the equipment but at the same time also reduces the ability of cybersecurity products to detect vulnerabilities. Claroty uses a technology called AppDB that finds vulnerabilities in isolated industrial devices by analyzing their backup configuration files, which removes the need to access them directly through the isolation layer. 

The startup’s platform captures fine-grained details such as what firmware a system is running and which industrial equipment supplier made it. Claroty then compares the information against a database of vulnerabilities to identify if the system or one of its software components has a security issue. While at it, the platform’s algorithms look for security issues stemming incorrectly defined configuration settings.

Another focus area for Claroty is simplifying the task of connecting to industrial equipment. Administrators frequently need to log into industrial systems in order to perform maintenance tasks such as troubleshooting. To access sensitive systems that are isolated from the rest of the network, they have to route connections through a so-called jump server, a device that acts as a tunnel between the less sensitive part of an industrial company’s network and the high-priority isolated parts.

Claroty says its platform facilitates secure connections to industrial equipment without the need for a jump server. The result is that information technology teams have one less system to maintain. The startup is also promising easier and faster network access to devices for administrators looking to perform troubleshooting. 

Claroty’s plans following the new round include expanding into additional industry verticals and regions. The startup also plans to extend its product portfolio. 

The industrial cybersecurity segment where Claroty competes is benefiting from the continued growth in the number of internet-connected devices that industrial companies are deploying to support their operations. The more devices there are in the network, the larger the potential attack surface, which creates a bigger need for cybersecurity software.

Companies are also increasingly deploying edge computing servers in factories and other industrial environments to support analytics initiatives. Edge computing hardware makes it possible to run workloads such as equipment monitoring applications on-premises, which enables faster processing than sending data to the cloud. The increasing amounts of edge computing hardware deployed in the industrial sector, which has to be secured just like traditional equipment, could in the long term help lift spending on cybersecurity software even more.

Claroty has raised $235 million in funding to date. The New York-based startup reportedly expects that the $140 million round announced today will be its last before going public.

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