Stormpath $8.2m Series A Funded by Pete Sonsini at NEA to Drive Secure Software-led Infrastructure

Stormpath a startup announces $8.2 million venture round of funding with NEA, Pelion Venture Partners, and Flybridge Capital. Stormpath is popular with developers and just formally exited its beta period with more than 1,000 users onboard and launched general availability of its service.

Founded in 2011, Stormpath set out to overcome a key security hurdle for cloud-based companies: authentication and management of a large user base.  The company built a product for developers to safely store user data and manage access control to the application. With a simple API integration, developers can reduce development and operations costs, while protecting their users with best-in-class security. common work like authentication, account management, and password reset workflows allows development teams to focus on core business features.

“Stormpath has built an impressive team and is at the heart of cloud infrastructure and developer-driven IT,” said Peter Sonsini, general partner at NEA. “We’re excited by the wave of developer services, and because user management is necessary for every application, every developer can use the service.”

According to the company, Stormpath is targeting a large and fast-growing market at the intersection of identity and cloud development. According to analysts, the IDM (Identity Management) market will grow to $12 billion in 2014, with cloud adoption growing at 24 percent annually. Almost half of applications built in the cloud are externally facing, and require robust user management and security infrastructure. Stormpath fills that gap with a secure service that is simple for development teams to deploy and maintain.

“We’re entering the age of plug-and-play architecture, where developers can easily and securely offload commodity infrastructure – like user management, billing, and logging – to API services,” said Alex Salazar, CEO of Stormpath. “Developers don’t want to waste time rebuilding user login for every new app – it’s critical to the business, but not core to their product, and getting it wrong is expensive. Sony got caught on a totally preventable mistake, and it cost them $171 million.”

The Series A round was preceded by a seed round from NEA and Flybridge, and an angel round led by Andy Rachleff, co-founder of Benchmark Capital and CEO at WealthFront.

Breaking Analysis

I like this company, but I am concerned that their messaging is all over the place. This might be a problem for them going forward. I like how Stormpath is looking at application assembly for the cloud.  Specifically, policy based security around data is huge opportunity and the open source angle is sold.  By having developers expand their market, Stormpath has a real opportunity.  They should just focus on that alone.  Any company that makes developers job easier and more elegant is a home run.