15 cybersecurity startups that will make it big in 2021, according to venture capitalists

  • We asked a group of venture capitalists to name the startups, both from inside and outside their portfolios, that they expect to soar next year.
  • VCs named so many cybersecurity startups that we couldn't include all of them on our main list (which you can read here: 81 startups that will boom in 2021).
  • Analysts expect cybersecurity spending to dramatically increase in 2021 and many security startups are poised to capitalize on companies' need to shield against new threats that have emerged amid remote work and the COVID-19 pandemic.
  • Visit Business Insider's homepage for more stories.

2020 has exposed gaping cybersecurity vulnerabilities like no other year in recent memory.

The COVID-19 pandemic forced companies to grapple with new threats associated with remote work. Sophisticated hackers scaled up ransomware attacks, with US hospitals in their crosshairs. And last month, the unprecedented SolarWinds hack showed how even top companies and the highest levels of government can be susceptible to hacks.

Analysts now predict that cybersecurity spending will soar in the coming year, spurred by the vulnerabilities that have become apparent in 2020. And as companies and government agencies increasingly shift to cloud computing, there's a massive need for new security products to keep their data safe.

A slew of new startups have emerged to help businesses adapt to shifting cyber threats. Business Insider asked successful venture capitalists about the startups they believe will boom in the coming year. They were asked to name startups inside and outside of their portfolios, meaning startups that their firms had invested in as well as ones with which they have no financial relationship.

We published one big list of 81 startups that will boom in 2021 but VCs nominated so many cybersecurity startups that we couldn't include them all in that larger list.

The following list, organized alphabetically, showcases the rising venture-backed companies providing security services in the business-to-business tech market, as named by VCs. We included the estimates of their total funding according to deal database Pitchbook.

Here are the 15 cybersecurity startups that VCs say are set to make it big in 2021:

Abnormal Security: Defense against malicious email and supply chain attacks

Startup: Abnormal Security

Recommended by: Theresia Guow, Acrew Capital

Relationship: No relation. VC just thinks it's cool.

Total funding raised: $75 million

Headquarters: San Francisco, CA

What it does: Its AI software helps companies protect against email cyberattacks as well as "supply chain" attacks, where malicious code is snuck into other products, as happened with the SolarWinds hack.

Why it will boom in 2021: "Cybersecurity attacks have continued to increase and email attacks even more so given [remote work] during this pandemic," Guow said.

"Unlike legacy email security solutions, the Abnormal Security platform uses an innovative AI-based approach that deeply understands people, relationships and business processes to stop the most sophisticated cyber-attacks," she added.

Armis: Cybersecurity for enterprise Internet of Things devices

Startup: Armis

Recommended by: Derek Zanutto, CapitalG

Relationship: Investor

Total funding raised: $112 million

Headquarters: Palo Alto, CA

What it does: Armis sells a security platform that helps companies protect Internet of Things (IoT) devices from cyberattacks.

Why it will boom in 2021: "Many IT departments desire to adopt enterprise IoT devices but opt not to due to the significant cybersecurity risks that accompany large-scale deployments," Zanutto said.

"Through its industry-leading, agentless device and security platform, Armis is uniquely positioned to help enterprises leverage the potential of IoT while keeping their cybersecurity risks in check," he said.

Cmd: The cybersecurity gate for Linux

Startup: Cmd

Recommended by: Karim Faris, Google Ventures

Relationship: Investor 

Total funding raised: $21.6 million

Headquarters: Vancouver, Canada 

What it does: Cmd is a security tool that helps track and authorize the people who have access to a company's cloud servers that are running the open source operating system Linux.

Why it will boom in 2021: "Workloads continue their move to the cloud at a torrid pace. At scale, security controls are harder to implement or only provide narrow forms of protection," Faris said. "The modern enterprise needs tooling that's purpose-built to protect data in the cloud and who has access to it. Cmd can help."

Docsend: Secure document sharing platform

Startup: Docsend

Recommended by: Ben Ling, Bling Capital

Relationship: No relation. VC just thinks it's cool

Total funding raised: $14.70 million

Headquarters: San Francisco, CA

What it does: The startup offers a secure document-sharing platform that lets users know when documents are opened and read.

Why it will boom in 2021: Ling said that DocSend has become "the standard for investor communication and fundraising." 

Eclypsium: Cloud-based device security

Startup: Eclypsium

Recommended by: Steven Greenberg, Alumni Ventures Group

Relationship: Investor

Total funding raised: $24.05 million 

Headquarters: Portland, OR

What it does: Eclypsium offers a cloud-based security service that protects any device that connects to the corporate network from hackers, right down to the firmware, including corporate laptops, network equipment, and servers in data centers.

Why it will boom in 2021: "As data privacy and security continues to become more and more important to large enterprises, Eclypsium is positioned well to challenge hackers who are become more sophisticated and looking for exploitable loopholes in firmware," Greenberg said.

Esper.io: Software for companies to manage corporate devices running Android

Startup: Esper.io

Recommended by: Tim Porter, Madrona

Relationship: Investor

Total funding raised: $11.72 million

Headquarters: Bellevue, WA

What it does: The startup makes software for companies to manage Android devices.

Why it will boom in 2021: "This is a huge and growing market as more and more intelligent edge devices are deployed — from exercise bikes to food delivery tablets to intelligent signs — nearly all of which now run Android," Porter said.

Expel: A cloud service that helps companies respond to cybersecurity issues

Startup: Expel

Recommended by: Gene Frantz, CapitalG

Relationship: Investor

Total funding raised: $117.5 million

Headquarters: Herndon, VA

What it does: Expel's cybersecurity monitoring service offers companies simple instructions if it sees something amiss within their network.

Why it will boom in 2021: "Securing the enterprise has become an increasingly unmanageable problem for business leaders given the continually expanding cyber threat landscape and endemic shortage of cybersecurity personnel," Frantz said. 

The cyberdefense capabilities Expel offers will be even more critical in a "COVID-affected, widely-distributed work world," he said.

ForAllSecure: Automating application security bug hunting

Startup: ForAllSecure

Recommended by: Aaron Jacobson, NEA

Relationship: Investor

Total funding raised: $14.7 million

Headquarters: Pittsburgh, PA 

What it does: It creates cybersecurity tools that find and fix software vulnerabilities for clients like the US Department of Defense and Cloudflare.

Why it will boom in 2021: "Given the shortage of cybersecurity talent, enterprises are unable to keep up with discovering, monitoring, and fixing [software] defects," Jacobson said.

"ForAllSecure is pioneering autonomous application security with an advanced fuzzing solution that can discover known and unknown vulnerabilities without manual testing," he said.

Kandji: A way for large companies to manage employees' Apple devices

Startup: Kandji

Recommended by: Josh Kopelman, First Round Capital

Relationship: Investor

Total funding raised: $28.44 million

Headquarters: San Diego, CA

What it does: Provides mobile-device-management software for large companies to manage employees' Apple devices.

Why it will boom in 2021: "Given the recent adoption of remote and work from home culture, Kandji stands to gain by providing the most robust and flexible [device management] solution on the market," Kopelman said.

Sonrai Security: Securing public cloud computing for businesses

Startup: Sonrai Security

Recommended by: Venky Ganesan, Menlo Ventures

Relationship: Investor

Total funding raised: $38.5 million

Headquarters: New York, NY 

What it does: Sonrai's software finds security holes in companies' infrastructure when using public cloud services like Amazon Web Services, Google Cloud, and Microsoft Azure.

Why it will boom in 2021: "Sonrai Security solves a pervasive problem that will only become more prevalent as the trend towards public cloud usage grows in 2021 and beyond," Ganesan said.

Tailscale: New-age virtual private networks for businesses

Startup: Tailscale

Recommended by: Amit Kumar, Accel

Relationship: Investor

Total funding raised: $17.26 million

Headquarters: Toronto

What it does: Tailscale enables the easy creation and management of virtual private networks (VPNs) for businesses.

Why it will boom in 2021: "COVID has radically accelerated the shift towards remote and distributed teams, forcing organizations of every size to reconsider their security and access posture," Kumar said. "Tailscale's world-class engineering team has built a leapfrog product, based on the widely adopted open-source Wireguard protocol and has unmistakable early buzz in the developer community."

Tines: A no-code platform for automated security

Startup: Tines

Recommended by: Sarah Guo, Greylock Partners

Relationship: No relation. VC just thinks they're cool. 

Total funding raised: $15.1 million

Headquarters: Dublin, Ireland

What it does: Tines lets security teams automate their repetitive tasks using its no-code dashboard.

Why it will boom in 2021: "Investing in automation remains a top priority for security teams," Guo said, but that automation typically requires coding upfront. Tines makes automation more accessible with a platform that doesn't require any coding skills.

Trace Data: Tools for sending and tracking sensitive data

Startup: Trace Data

Recommended by: Matt Howard, Norwest Ventures

Relationship: No relation. VC just thinks they're cool.

Total funding raised: $5 million

Headquarters: Wilmington, DE

What it does: Trace Data's software lets companies see where their data is being accessed and used to ensure it's kept private and secure.

Why it will boom in 2021: Amid remote work, "managing and securing data has never been a bigger priority," Howard said. "Trace Data keeps all data secure in connected systems with a single platform, making it easier to manage all data at once."

Uptycs: Security analytics platform for preventing and detecting hacks

Startup: Uptycs

Recommended by: Venky Ganesan, Menlo Ventures

Relationship: No relation. VC just thinks it's cool.

Total funding raised: $40.25 million

Headquarters: Waltham, MA

What it does: Uptycs' platform provides a dashboard for security teams that lets them monitor what's happening across their company and investigate unauthorized intrusions.

Why it will boom in 2021: Cybersecurity teams need to be able to rapidly gauge potential security threats, Ganasan said, especially as they increasingly rely on cloud computing and shifting endpoints amid remote work.

Uptycs has applied advanced modeling and database techniques for "real-time pipeline processing," Ganesan said, meaning it can crunch through tons of security-related data quickly.

The result is "a security analytics platform for visibility and accelerated time to insight," he said.

Vanta: Automated security and compliance for software companies

Startup: Vanta

Recommended by: Amit Kumar, Accel Ventures

Relationship: No relation. VC just thinks it's cool.

Total funding raised: $2.95 million

Headquarters: San Francisco, CA

What it does: Vanta's automated platform lets software vendors and their buyers assess the security and compliance of their products.

Why it will boom in 2021: As companies increasingly license software-as-a-service tools, they, as buyers, need to be able to easily evaluate the security of those products, Kumar said.

"COVID-induced cloud acceleration sets up Vanta very well to capture the demand for greater velocity and certainty in the sales process in the next 12-to-24 months," Kumar added.

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