API startup Noname Security launches out of stealth in a hot area of security with $25 million in funding and its CEO explains why resisting layoffs despite the pandemic was crucial
Originally posted on Business Insider.
- On Tuesday, the API security startup Noname Security launched out of stealth with $25 million in funding from Lightspeed, Insight Partners, and Cyberstarts.
- Noname Security helps companies monitor and secure the application programming interfaces (APIs) they use to link together data from different apps.
- The coronavirus pandemic started raging through the world shortly after its formation, but it decided to keep hiring, despite external pressure to layoff off employees or cut salaries.
Israeli entrepreneurs Oz Golan and Shay Levi started a new security company right as the coronavirus became a worldwide pandemic. Their startup, called Noname Security, builds a security platform that allows businesses to monitor and secure application programming interfaces (APIs), which link together features from different apps, essentially allowing them to "talk to each other." Because APIs can access sensitive data within an organization, the service is meant to eliminate potential security blind spots.
The timing was terrible and CEO Golan says he felt pressured to lay off employees or make salary cuts. The company resisted, however, and retained all its workers without pay adjustments. The firm continued to hire and has about 30 people working there now.
Golan attributes the decision to avoid layoffs and continue to hire key to the early success building Noname Security, which just launched out of stealth Tuesday with $25 million in funding from Lightspeed, Insight Partners, and Cyberstarts.
"Our employees are the most important thing for a young company," Golan told Business Insider. "Since we hired the best engineers out there, we knew we would be able to find the right solution. We actually hired more employees in the beginning. We don't have a name or strong customer base. The only thing you can rely on is the employees at your company."
How Noname Security raised its funding
Golan and Levi, the CTO, originally met when they served together in the Israeli Defense Forces' intelligence division Unit 8200. After his service, Golan spent nearly five years at the controversial spyware company NSO Group, but left in January to start Noname Security with Levi.
When the duo started approaching potential customers about their technology, they hadn't thought of a name yet so they started calling the tech "No name." It stuck.
Noname Security first pitched itself to the Israel cybersecurity venture firm Cyberstarts and had "great chemistry." Then other VC firms, including Lightspeed, proactively reached out: Partner Guru Chahal says he first heard of Noname Security through a chief information security officer in his network and contacted the startup because he believes that API security will be the next big market, similar to how cloud security is now a major one.
"APIs are exponentially increasing in enterprise environments," he said. "Somebody has to discover them, monitor them, and fix those vulnerabilities."
Similarly, Insight Partners principal Thomas Krane told Business Insider that the firm sees API security as some day being "mission critical" for "virtually every company out there in the world."
"As every company — enterprise and global 2000 — effectively become software companies in their own right and are going to have APIs in their own environment, they want to make sure they can be properly instrumented," Krane said.
It only took Noname Security two weeks to close its round of funding.
While Noname Security declined to share its valuation, it said that it plans to use the funding for product development, marketing, and hiring, with plans to expand its operation in the US to 100 employees by the end of next year and to bring in more Fortune 500 customers.
"We really want to take over the market," Golan said. "API security is a hot topic."