Author: AllegisCap

A new breed of startups is helping hackers make millions — legally. The bug bounty business is booming.

  |   Portfolio News, The Latest


By Ben Popper  on March 4, 2015 09:12 am


Shashank Kumar was in seventh grade when he was introduced to computer hacking. At first he had fun breaking in and defacing web sites, something he says he now regrets, but then he learned that he can get paid for reporting the weaknesses he was exploiting. Under the handle @cyberboyIndia, he says he has earned around $30,000 in so called bug bounties, enough to pay for a good portion of his college education.

These days the 19-year-old is supposed to be cramming for his final exams as he prepares for a degree in engineering. But many nights he finds himself awake too late, laptop humming away, hunting for software vulnerabilities on services run by firms like Yahoo, Paypal, and AT&T. On Twitter, Shashank catalogs the rewards he receives for reporting weaknesses, a highlight reel that ranges from a free hat, to a new smartphone, to a $1,500 check. The money is good, although it’s murder on his grades.


E8 Security Emerges From Stealth, Raises $9.8M in Series A Funding

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March Capital Partners, Allegis Capital and The Hive invest in innovative security intelligence and analytics company.


 REDWOOD CITY, Calif.–(BUSINESS WIRE)–E8 Security, provider of cyber security analytics solutions to help enterprises detect and manage malicious insider threats and targeted cyber attacks, today announced it closed $9.8 million in series A funding led by March Capital Partners, with participation from Allegis Capital and The Hive. The funding will be allocated to furthering product development, currently in private beta with several large domestic and international organizations, while also expanding the organization’s engineering and development teams.

“E8 Security presents a new approach to addressing cyber security threats”

Recent years have seen an increased number and sophistication of cyber attacks with the average enterprise generating more than 10,000 security events daily. Preventive controls alone cannot defend against all security threats, particularly targeted attacks and insider threats. Priorities for security teams are shifting to more sophisticated detection and response capabilities for visibility into threats that have bypassed perimeter security and preventive controls. Traditional security solutions that rely on previously known threat indicators, pre-configured rules, and malware signatures are no longer effective in detecting malicious activities of sophisticated attackers. Demand for enhanced cybersecurity solutions that go beyond rules and signatures based threat detection increases daily.


Synack Closes $25 Million in Series B Funding Co-Led by GGV Capital and Icon Ventures, Joining KPCB and Google Ventures

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New Financing Fuels Recruitment of Top Researchers, Drives Technology Development to Crowdsource Enterprise Security

From Synack

February 19, 2015 17:16 ET

REDWOOD CITY, CA–(Marketwired – Feb 19, 2015) – Synack, a security startup that has created a unique enterprise-caliber system to safely crowdsource and manage security testing, today announced it has raised $25 million in Series B funding co-led by GGV Capital and Icon Ventures (formerly Jafco Ventures). This brings Synack’s total funding amount to more than $34 million raised in less than two years. Glenn Solomon, managing partner at GGV Capital, and Tom Mawhinney, general partner at Icon Ventures, will be joining Synack’s board of directors.

Existing investors Kleiner Perkins Caufield & Byers (KPCB), Google Ventures, Greylock Partners and Allegis Capital, as well as Derek Smith, CEO of Shape Security; Ray Rothrock, CEO of Redseal Networks and Timothy Eades, CEO of vArmour, also participated in the round.

CEO Jay Kaplan and CTO Mark Kuhr, former National Security Agency analysts, formed Synack in May 2013 with a unique crowdsourced intelligence model that leverages Synack’s top security talent to uncover attack vectors in organizations that can’t be detected by technology alone. The company has experienced remarkable success since securing Series A funding nine months ago — growing revenue by 90 percent, increasing customers by 60 percent and expanding its expert researcher community by 40 percent. Synack continued its focus on recruiting the highest-quality security talent by hiring a new VP of strategy and operations, Gus Anagnos, who previously led information security at PayPal, where he successfully developed and led the first Bug Bounty Program for a financial institution.


Three white-hot areas for cybersecurity investors in 2015

  |   Allegis News, The Latest

December 22, 2014
Bob Ackerman, Allegis Capital 

The global security market was little more than a cottage industry in 2002, when it was an insular $3.5 billion market dominated by just five vendors. Fast-forward to today and there is — I estimate — $87 billion being spent in 2014, while that number should increase to $120 billion by 2017, according to AGC Partners . What’s more, venture investment in cybersecurity startups is red hot. In the second quarter of this year, security startups took in $767 million in financing, according to CB Insights. That’s more than any other quarter in recent history. In 2013, VCs bankrolled 230 security startups, and even more are getting funded this year.

But not all security startups are created equal. As investments and budgets increase, two distinct approaches to cybersecurity are emerging. The first is aimed at protecting the legacy of the past; the second is dedicated to developing technology that’s inherently secure for the future. Strategies that protect the legacy focus on the gaps, holes, and vulnerabilities in today’s IT infrastructure, the majority of which is based on a 45-year-old architecture.


As a venture investor, I’m interested in both areas. That said, there is a lot more growth in solutions and technologies that are focused on safeguarding the future. I’m intrigued by new technology platforms that are secure by design, by technologies that are truly impregnable, not technologies that close existing gaps.


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Are federal integrators where technology goes to die? Here’s why one Silicon Valley investor thinks so.

  |   Allegis News, The Latest

Jill R. Aitoro
Senior Staff Reporter-
Washington Business Journal
Oct 28, 2014

Cybersecurity is a key area of investment for Allegis Capital. But if a promising startup says it’s going to target federal government, Managing Director Bob Ackerman shows them the door as fast as possible.

It’s a reality I’ve reported on before and spurs a lot of D.C.’s most promising startups to pack their bags for Silicon Valley: Regardless of the billions of dollars the government claims to filter to technology, venture capital firms have no patience for the federal contracting morass.

And in the case of cybersecurity in particular, it’s a shame, Ackerman told me. Proximity to Fort Meade in Maryland makes the D.C. metro area a natural reservoir of cyber talent, but the supply of what he described as relevant capital remains critically low. So young entrepreneurs consult for a while, then leave when it comes time to get their big idea off the ground.

Consider Kevin Mandia. He was focused on consulting when he was at the helm of Mandiant and made a name for himself talking about Chinese hackers targeting U.S. systems, Ackerman said. But then Mandiant got bought by FireEye Inc. in Silicon Valley, Mandia moved out west when he was appointed chief operating officer, and Mandiant has gradually been merged with other acquired companies to offer a product that targets primarily commercial customers.