Hot Israeli cloud security startups for the CIO, CSO watch list

Israel is a crucible for cloud security startups aiming to solve enterprise security issues for open source, serverless, container and virtual computing technology.

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The shift to cloud computing, virtual machines, and automated development has opened up a myriad of new security challenges that legacy firewall software can't handle. The changed architecture has created a demand for new solutions that has driven the germination of a crop of cloud security startups in recent years.

Many of those cloud security ventures are sprouting up in Israel, where there's deep information security know how and a culture of early adoption has prompted an embrace of digital transformation and cloud migration.

"What happened is that the technical expertise about that domain existed,'' said Dudu Mimran, a co-founder of endpoint security startup Morphisec. "Then, once you connect to that co-founders coming from the cybersecurity angle, the result is that you see many permutations of different types of security solutions for these environments."

Israel military spurs cutting-edge cybersecurity

Israel's technology sector has a reputation for cutting-edge cybersecurity technology that dates to the early 1990s. That's when several veterans of the military's signal intelligence unit established Check Point Security Technologies, a pioneer in the field of firewall perimeter security for corporate enterprises.

Ever since, alumni of both Check Point and of the military's technology units have gone on to found hundreds of cybersecurity startups —  some of which have been snapped up by multinationals and others which have grown into players in their own right. That has made Israel into a fertile ground for cybersecurity investments, whether they be startups or R&D arms of companies based abroad.

A recurring motif among the startups is that many of the founders' careers intersect with military tech units and Check Point.  Below are several Israeli cloud security ventures worth following.    

WhiteSource

 Year founded: 2011

 Funding: US$46 million

Headquarters: New York

 CEO: Rami Sass

What they do:  Open-source development platforms have become a cornerstone for building the tools used for cloud computing services, but the decentralized nature of these platforms makes them extremely vulnerable to security breaches. WhiteSource makes software that helps enterprises identify and mitigate vulnerabilities in code developed on open source projects. Among other features, WhiteSource offers trace analysis designed to pinpoint vulnerabilities in code, highlighting how vulnerable code is being used in applications.

Competitors include: BlackDuck, Sync

Customers: IBM, Comcast, KPMG

Why they are a hot startup to watch: With headquarters in the U.S. and development in Givatayim, Israel, White Source counts Microsoft's venture arm as an investor. In 2018, the company raised $35 million. Before starting WhiteSource, the company's founders sold an identity management company to CA.

Aqua Security

Year founded: 2015

Funding: $100 million

Headquarters: Ramat Gan, Israel

CEO: Dror Davidoff

What they do: Aqua software makes a platform that scans containers – code packaged as an entire runtime environment -- for malware and insecurities. The platform is embedded into the container development process, enforcing security policies while they are being created. It also monitors applications that use cloud-based servers (serverless), and applications that sit in the cloud. [Read full review of Aqua Security.]

Competitors include: Twistlock

Customers include:  NCR

Why they are a hot startup to watch: Investors include Microsoft and Shlomo Kramer, one of the founders of Check Point, the Israeli firewall security pioneer. In April, the company raised $62 million in its fourth round of funding.

Orca Security

Year founded: 2019

 Funding: 6.5 million

Headquarters: Tel Aviv 

CEO:  Avi Shua

What they do: Allow companies to "see" inside of virtual computing systems sitting on public cloud platforms by using a scanning technique that analyses configuration and infrastructure data and reads virtual machine disks. Orca then identifies vulnerabilities in applications and operating systems. The Orca software also monitors applications developed on in-house legacy systems that were migrated to the cloud.

Competitors include: Rapid7, Tenable, Qualys

Customers: Undisclosed

Why they are a hot startup to watch: Gaining visibility into what is going on in the cloud is one of the biggest challenges in security cloud computing environments. The company's founders are alumni of Check Point.

Cato Networks

Year founded: 2015

Funding: $105 million

Headquarters: Tel Aviv 

 CEO:  Shlomo Kramer

What They Do: Cato attempts to simplify and reduce the costs of cybersecurity for organizations whose activity has moved beyond on-site data centers to public clouds and mobile workforces. Cato provides a cloud-based network for enterprises designed to securely connect all of its locations, people and data. The company offers an alternative to the broadband networks for enterprises provided by telecom equipment providers like AT&T.

Customers: Centrient Pharmaceuticals, Kyocera Senco,

 Competitors: AT&T, Verizon 

Why they are a hot startup to watch: Cato Networks has been on the radar of information security experts ever since Kramer founded it. Cato said it raised $55 million in January 2019 on the heels of fast revenue growth.   

Guardicore

Year founded: 2013

 Funding: $110 million

Headquarters: Tel Aviv

 CEO: Pavel Gurvich

What They Do: The company enables enterprises to segment and secure large volumes of traffic across networks that span both public clouds, like AWS and Azure, and on-premise data centers. Guardicore helps organizations to restrict access between devices in corporate networks by defining and enforcing detailed security policies, reducing the risk of a breach.

Customers: Deutsche Bank, Intermountain Healthcare

Competitors Include: Alcide, Acronis

Why they are a hot startup to watch: Guardicorp raised $60 million from investors such as Deutsche Telekom and an arm of Access Industries, controlled by the Russian American billionaire Len Blavatnik. An increasing number of organizations are opting to use a combination of on-site and cloud-computing capabilities. That means there will be increased demand to secure networks that operate in the hybrid cloud. 

Alcide

Year founded: 2016

Funding: $12 million

Headquarters: Tel Aviv

 CEO: Amir Ofek

What they do: Alcide focuses on providing security for Kubernetes, the most popular open-source platform for developing and managing containers. Alcide scans code in development stage and helps developers more easily take care of security, flags potential threats and violations of security policies, and monitors performance logs once code has been deployed.

Competitors include: Twistlock, Aqua

Customers: Undisclosed

Why they are a hot startup to watch: As companies embrace Kubernetes to automate their development of new apps and move computing to the cloud, companies like Alcide are securing those new the development pipelines. Intel Capital is an investor.

Morphisec

 Year founded: 2014

 Funding: $20.5 million

 Headquarters: Beersheva, Israel

 CEO: Ronen Yehoshua

What they do: Provide endpoint security for cloud-based computer workloads against Zero Day and ransomware attacks. It uses a "moving target" defense, scrambling system memory by moving default locations for system resources. [See full review of Morphisec.]

Competitors include: CrowdStrike

 Customers: Motorola, Yaskawa Motoman

Why they are a hot startup to watch: Morphisec's technology originated in Israel's national cybersecurity center, and counts Deutsche Telekom and GE as investors. In 2018, the startup got an award from the U.S. Department of Homeland Security to develop technology to protect financial institutions against attacks. 

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