Cowbell Cyber Inc., a startup that insures businesses against cyberattack-related losses, has raised $60 million in a Series C funding.

The company announced the investment today. It disclosed that the capital was provided by Zurich Insurance Group Ltd., one of the world’s largest insurers. The cash infusion brings Cowbell’s total outside funding to $202 million.

Companies often purchase not one but multiple insurance policies to protect against potential losses. In many cases, one of those policies is a so-called cyber insurance plan designed to mitigate the financial impact of a cyberattack. Pleasanton, California-based Cowbell competes in this market with a collection of cyber policies geared towards small and midsize businesses.

The company’s plans cover the costs associated with detecting and remediating a breach. Depending on the policy, Cowbell can also shoulder several related expenses. It provides policies that cover items such as breach-related legal fees and the cost of replacing hardware rendered inoperable by ransomware.

Cowbell’s entry-level plan, Prime 100, is geared towards businesses that generate up to $100 million in revenue. It also provides policies for larger organizations, as well as a number of specialized insurance offerings. One of those specialized policies is designed for tech firms, while another targets businesses in the UK with annual sales of up to £1 billion.

Companies that sign up for a Cowbell policy receive a so-called Cowbell Factor with their purchase. This is a score that measures the effectiveness of an organization’s breach prevention program. According to Cowbell, it calculates the score based on more than 1,000 data points including information about the security of a company’s employee devices and cloud environment.

A cloud-based dashboard displays the weak points that the company identifies in a customer’s cybersecurity posture. Cowbell can, for example, point out if backups of a cloud application can be accessed over the open web without a password. Cybersecurity issues are ranked based on their severity to help companies fix the most urgent vulnerabilities first.

According to Cowbell, businesses can obtain more favorable insurance terms by fixing weak points in their infrastructure. In some cases, cybersecurity improvements unlock lower deductibles when a policy is up for renewal. Cowbell can also extend an insurance plan’s scope to cover more types of breaches.

The company will use the proceeds from its latest funding round to move closer toward profitability. “We have been on a mission to achieve near-term operating profitability over the last 12 months and will continue our quest for the rest of the year and into 2025,” Chief Executive Officer Jack Kudale detailed in a blog post.

In conjunction, the company plans to grow its international presence and develop new insurance products. The development effort will place an emphasis on finding more ways of using artificial intelligence to improve its offerings. Cowbell has already built an internal AI assistant, Cowbell Copilot, to speed up the process of issuing new insurance insurance plans. 

Photo: Cowbell