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Coro, dedicated to building cybersecurity for small and medium-sized enterprises, locks in $100 million at a $750 million valuation

Enterprises and other large organizations have long been lucrative and obvious targets for cybercriminals, but in recent years, small and medium-sized businesses are now also highly visible due to the rise of more sophisticated breaching techniques and artificial intelligence. Now, Coro — one of the startups that specializes in building tools for small businesses — has announced a major funding round after seeing its recurring revenue jump 300% in the last year. It has raised $100 million in Series D funding. Sources with knowledge of the deal told TechCrunch that it was valued at more than $750 million post-money.

New York-based Coro has so far focused on the U.S. market — no surprise, since the U.S. alone is home to more than 33 million small and medium-sized businesses — but with this round, the startup hopes to expand internationally, starting with Europe its business. To that end, it’s worth noting that the lead investor in this round is One Peak, a UK late-stage company focused on enterprise technology. Previous backers Energy Impact Partners and Balderton Capital also participated.

Coro also plans to use the funding to continue R&D, specifically bringing more AI tools to its one-stop platform to better match and ideally defeat the capabilities of the most sophisticated malicious hackers.

IBM research estimates that the average cost of a data breach will reach $4.45 million in 2023, and while a single attack against very large organizations may still grab the most headlines, cybercriminals are increasingly starting to focus more on small and medium-sized organizations Enterprise, applied the laws of economies of scale and capitalized on one of the biggest trends in enterprise over the past two decades – the rise and dominance of SaaS.

“The barrier to entry for attackers has dropped significantly over the past two years,” co-founder (and chief marketing officer) Dror Liwer said in an interview. The main culprit, he said, is the rise of attack-as-a-service technology, specifically ransomware-as-a-service.

“In the past, you needed to know a lot in order to perform a very sophisticated attack, and the cost of performing the attack itself was very expensive. Today, you can go to a website, upload a list, and then rent the attack and follow the market. So the cost of the attack is also significantly higher. Decline. What that means is that the ROI of attacking mid-market or small businesses has improved dramatically because it used to be very expensive to do so.”

In the past, it might have cost $1 million to get a list of 100,000 because of returns, Liwer said. Now, you can pay $50,000 per listing “and still be very, very profitable.”

These statistics are certainly felt by startups themselves. Tripwire’s research shows that about 73% of small businesses reported a security incident last year. Among SMEs surveyed by Digital Ocean, 74% cited data privacy as their top concern.

Coro sees an opportunity in the security market for small and medium-sized businesses, which often lack the dedicated teams and internal IT budgets to build and manage defenses. Therefore, Coro’s approach is to build an all-in-one platform that covers the various entry points criminals may take, including email protection, endpoint protection and cloud protection. It works in a highly competitive field. Other companies in the same category include large providers like CrowdStrike, as well as younger startups like CyberSmart and Guardz.

But Coro’s entry into the market, particularly in the mid-market (50-2,000 employees) by leveraging channel partners such as ISPs, has caught the attention of investors.

“As growth investors, we look for companies that target large, underserved markets and are well-positioned to dominate the space,” One Peak co-founder and managing partner David KIein said in a statement. Coro has achieved incredible growth and success in the SMB market. We believe Coro has the right technology stack, a world-class management team, and unlimited potential to scale the business to the next level. We are excited to partner with Coro to help realize their vision , and support the team’s next step in explosive growth.”

Some background on Coro’s valuation: Coro (which started out as CoroNet during the Disruption Battlefield phase) has been on an annual cadence at a time when startups, especially those in the later stages, are still finding it difficult to close funding. In April 2023 last year, this round of financing amounted to US$75 million, with a valuation of US$575 million (also a post-money valuation).

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