Karamba Security, a maker of cybersecurity software for connected and autonomous vehicles, said it has raised $12 million in Series B funding, bringing total investment in the company to $17 million.
The funding round comes just 15 months after the company closed a seed round, in March 2016. The investment will be used to expand customer support, sales and R&D so that it can meet the rapidly growing demand, the company said in a statement Tuesday.
Karamba Security has developed a prevention software that protects the car and blocks hacking attempts as they deviate from the car’s factory settings.
The technology makes sure that only what’s part of the factory settings can run, basically enabling the embedded systems of the car manufacturer to protect themselves against hacking attempts. This helps ensure drivers’ safety by preventing the attack before hackers do harm, Karamba said. The system also avoids false positive alarms that could be risky for drivers, the startup said.
Existing investors YL Ventures and Fontinalis Partners led the round, followed by GlenRock Israel. There were also new investments from Paladin Capital Group, a government, security and intelligence-focused multi-stage investor in cybersecurity solutions for government and commercial markets; the managing director of Paladin is Chris Inglis, a former deputy director of the United States National Security Agency.
Also among the new investors in Karamba are Liberty Mutual Strategic Ventures, the early stage venture capital arm for Liberty Mutual Insurance’s Global Consumer Markets business; Presidio Ventures, the early stage investment vehicle of Sumitomo Corporation and Asgent, Inc., a Tokyo Stock Exchange-traded provider of security management solutions.
It is the first time that Paladin and Liberty are investing in an Israeli firm, the statement said.
“Threats from nation states, hacktivists and ransomware authors continue to grow in scope and scale, threatening consumers in every facet of their daily lives. We can no longer afford to simply react to this phenomenon,” said Paladin’s Inglis. “We must get ahead of it. To that end, automotive cybersecurity requires stopping the attack before the hacker succeeds to infiltrate the car. Karamba Security’s software turns the tables on attackers, seizing the initiative on the front end of an attack cycle in a reliable, deterministic way – to safeguard people’s lives as much or more as the systems they use.”
Karamba has been recognized with the 2017 North American Frost & Sullivan Award for Automotive New Product Innovation and by Forbes Israel as one of Israel’s Top 10 Most Promising Cybersecurity Companies.
The announced sale of Mobileye, a Jerusalem-based developer of advanced vision and driver assistance systems. to Intel Corp. for $15.3 billion in March has increased the buzz around auto technologies in Israel. The global market for cybersecurity for cars is estimated by MarketsandMarkets, a research firm, to grow at a compounded annual growth rate of 13.2 percent from 2016 to 2021, and reach a market size of $31.8 million by 2021.