Perception Point offers a service that protects against a broad variety of threats targeting email and multiple other collaboration platforms, and while they started selling direct to enterprises in 2019, they began to build build out a channel last year, which is focused on the sub-1000 seat market.
Perception Point, which provides protection for email and multiple collaboration platforms as a service, has announced it has raised a $28 million Series B funding round, bringing their total funding to $48 million. It’s an aggressive funding strategy for a company with an aggressive market strategy of ripping and replacing better known competitors. The funding strategy is also dictated in part by Perception Point’s expansion into the channel last year.
Israeli-headquartered Perception Point was founded in 2015, but in terms of actually selling product, they are considerably more recent than that.
“Perception Point was started in 2015 by three 3 young entrepreneurs, out of the IDF, and I was called in in 2017 by investors to run the venture,” said Yoram Salinger, Perception Point’s CEO. “They had a brilliant technology proof of concept. My job was to turn it into a product and take it to market. In 2017-18, we built out a service, and the middle of 2019 was our first engagement with the market.” In 2020, they tripled their recurring revenue from the previous year.
Perception Point is a cyber as-a-service company – although they didn’t start out that way.
“The company started off with a product that was a box, and that is what it was when I came in,” Salinger said. “Our core technology is a very efficient dynamic detonation of files, which is where we started. We had the ability to do in less than 10 seconds a dynamic scan for a file that takes a traditional sandbox 7-10 minutes. We realized that this was best provided as a service. And while we initially started out just protecting email, we realized that email protection alone was not sufficient. We needed to cover all channels.”
Salinger said that Perception Point provides 360 degree coverage for the enterprise, with three major elements to the service.
“We are hosted on AWS, and help protect against all kind of attack vectors that leverage content – including phishing, spear phishing, spam, business account compromise, and account takeover,” he stated. “While some of our competitors just do one thing, like stop phishing attacks, attacks today are often combinations of attacks. We are experts in all of the threat vectors.”
Second is that while Perception Point was originally conceived as email protection, they pivoted to cover multiple channels, including cloud storage, CRM apps, and messaging platforms.
“Modern enterprise communications now typically cover 5-10 channels, and only 70% of attacks are now email,” Salinger noted. “30% try to leverage the other channels of communication. We have built in API-based protection solution to protect other channels, with Zoom and ZenDesk coming soon.”
The third element of the 360 degree is Perception Point’s ability to support the service itself.
“We don’t have a bulletproof solution,” Salinger said. “No cyber company does, and if any say they do, they are not being honest. So the system should be monitored and we have a strong incident response team, and have built in a very easy way to patch the system.”
Salinger emphasized the solution has to be extremely strong, because the type of solution they are dictates that they ultimately replace incumbent competitors, not play nice with them.
“When you aim to rip and replace very well-known incumbents, you have to be 110% ready for prime time when you show up,” he said. “You can’t win business if you aren’t knocking them down. We have over 70 customers today. Over 90% are replacing incumbents. Sometimes we go into a deployment where a competitor is present, but eventually we are a rip and replace. We switch out incumbents, sometimes more than one.”
Perception Point is agnostic in the market segments they address.
“There is no segment we address specifically,” Salinger said. “We are equally suited for finance, farm, consumer goods or anyone else. We deploy in as few clicks as possible. Today, if you need to get IT to invest a lot of time deploying you, it doesn’t happen. It takes less than one hour to deploy our system.”
Perception Point’s initial Go-to-Market strategy was direct, and focused on the enterprise, but both of those things changed last year.
“We target the enterprise, and direct does the vast majority of deals we currently have,” Salinger indicated. “However, in the middle of 2020, we started to be approached by MSPs and MSSPs who asked if they could take us to market. We were hesitant. We didn’t want to deal with SMBs. But we gave it a try, and initially signed with some smaller MSSPs in the U.S. and Canada. To our pleasant surprise, we found that we are also relevant to these smaller enterprises.”
Today, Salinger said that they have close to ten partners in the U.S. and Canada, mainly MSSPs and MSP, but which also include a couple of what he termed ‘big fish’ solution providers who have come in as well.
“We have two models of supporting MSSPs,” Salinger said. “We are working with a very big one, who are not yet a public reference, and who serve 1000 other MSPs. We are being integrated into their portal. Our plan is to develop our own portal for the other MSPs we work with in 2021. Our intent is that customers of 1000 seats or less will go to MSSPs or other channel partners. We won’t deal with that market direct.”
Looking ahead, the major challenge remains competing against much bigger and better-known companies than themselves.
“The challenge is to get an enterprise to test something new, with a company that they may not know,” Salinger said. “We managed to get into the Gartner Report. Our biggest task for 2021 is to build brand and create lead generation by spreading the word. While CISOs make the final decisions, the security teams and soft teams test solutions, and we would be looking to have a broad reach just on the testing phase. Cyber spend is huge, and this is why we raised a lot of money.”
This accounts for their just announced Series B round, which is fairly aggressive for a company that has been selling for less than two years. The new funding round was led by Red Dot Capital Partners and joined by global investor NGP Capital, along with existing investors Pitango Venture Capital and State of Mind Ventures.
“When you raise money, take whatever they give you,” Salinger stated. “The vast majority of the investment will go to marketing, hiring new salespeople, and signing up with channels globally.”