Cybersecurity startups Orca and Wiz have rocketed to billion-dollar-plus valuations as a new trend in cloud-scanning tech takes off

<p><img src="https://static3.businessinsider.com/image/5ec41c903ad86168ba14fc79-2292/orcasecuritymanagingfounders.jpg" border="0" alt="Orca_Security_Managing_Founders" data-mce-source="Orca" data-mce-caption="Orca cofounders Gil Geron and Avi Shura"></p><p></p><bi-shortcode id="summary-shortcode" data-type="summary-shortcode" class="mceNonEditable" contenteditable="false">Summary List Placement</bi-shortcode><p>One year ago, a little-known, two-year-old Israeli security startup called Orca had raised a total of $6.5 million in seed funding at a $21.8 million valuation, according to PitchBook. Things changed quickly: On Tuesday, that little startup announced a $210 million Series C funding round that rocketed its valuation to $1.2 billion.</p><p>"We have accelerated dramatically because we are cloud security that actually works," Orca CEO Avi Shura told Insider.&nbsp;</p><p>Orca Security has created cloud-based cybersecurity software that automatically scans all sources of data from a company's application programming interfacesthe mechanisms that connect different apps, called APIswithin their public cloud accounts. Orca's software seeks out vulnerabilities, malware, mis-configurations, leaked or weak passwords, and more, allowing customers to patch or repair any issues.&nbsp;</p><p>Orca's ascent is not an isolated event: Another cloud-scanning startup, Wiz, <a href="https://www.wiz.io/blog/wiz-fastest-growing-security-startup-ever-with-new-valuation">announced on Monday</a> that it too has grown meteorically. Wiz raised a $130 million round of funding at a $1.7 billion valuation <a href="https://www.wiz.io/blog/wiz-fastest-growing-security-startup-ever-with-new-valuation">just a year after its founding</a>. Advent Venture Partners led the round, with participation from Cyberstarts, Index Ventures, Insight Partners, and Sequoia.</p><p>"It's cool to be the fastest-growing security company ever in our first year, but we are much more focused on our customers rather than the hype," Wiz CEO Assaf Rappaport told Insider.&nbsp;</p><p><img src="https://static2.businessinsider.com/image/5fdcfb87c910a400192e8663-1200/0005_NEL5138-2.jpg" border="0" alt="Assaf Rappaport, Wiz CEO" data-mce-source="Wiz" data-mce-caption="Assaf Rappaport, Wiz CEO"></p><p>With growth like Wiz and Orca's, there will be hype.&nbsp;</p><p>Brendan Burke, a senior emerging technology analyst at the startup-analysis company PitchBook, told Insider that the big rounds for two young companies "reflect the outstanding growth in cloud security spending" which he called one of the "fastest-growing categories in information security." Other blockbuster cybersecurity startups like <a href="https://www.businessinsider.com/cybersecurity-startups-ipo-netskope-darktrace-snyk-auth0-biocatch-2020-10">Netskope, SentinelOne, Snyk, and others</a>&nbsp;all boomed before Orca and Wiz, but fewif anyhave grown so fast.</p><p>Startups that scan public cloud assets for companies may get hotter, Burke says, as a new cybersecurity trend called <a href="https://www.businessinsider.com/xdr-cybersecurity-trend-solarwinds-microsoft-sentinelone-crowdstrike-hackers-ai-security-2021-3">extended detection and response (XDR)</a> continues to take off.&nbsp;</p><p>Orca's technology in that area made a believer of Gene Frantz, general partner at Google VC spin-off, CapitalG, which led the round with Redpoint Ventures. "We approached him," Frantz told Insider of Orca CEO Shura. "We think cloud security will be a huge market, and Orca is well-situated to address it."&nbsp;&nbsp;</p><p>The $210 million Series C round follows a $55 million B round in October 2020 and a $20.5 million Series A round in May of 2020, bringing Orca's total funding to $292 million. Previous investors GGV Capital and ICONIQ Growth also participated in the most recent round.&nbsp;</p><p>Orca Security achieved more than 1,000% year-over-year revenue growth in 2020 and signed customers including Robinhood, Databricks, Unity, Live Oak Bank, Lemonade and BeyondTrust, among many others.&nbsp;</p><p>Orca was "born in the cloud," rather than adapted from on-premise cybersecurity software. Customers can quickly get it up-and-running to survey their entire cloud-based operations without sending already-overworked cybersecurity staff thousands of "false-positive" notifications a day, Orca said. BeyondTrust's chief technical officer and head of security, Morey Haber, called the company's product a "must-have solution for businesses operating in the cloud,"&nbsp;in a statement on the news.&nbsp;</p><p>Despite the big-time valuation, Orca has retained some scrappiness, taking on Palo Alto Networksits $31.7 billion competitorin a public feud. Last fall Palo Alto Networks demanded in a legal letter that Orca take down from its website results of a side-by-side comparison of the companies' competing cloud-based cybersecurity products. Palo Alto Networks said its "name and logo are being misused."&nbsp;</p><p>Shura wrote <a href="https://orca.security/cybersecurity-community-transparency/">back in a blog post at the time</a> that "I urge you to make your products better and focus your marketing efforts on demonstrating that, rather than throwing away money on ill-conceived gag efforts."</p><p>Palo Alto Networks has declined to comment on the feud.&nbsp;&nbsp;</p><p><a href="https://www.businessinsider.com/orca-wiz-cybersecurity-funding-rounds-cloud-scanning-2021-3#comments">Join the conversation about this story &#187;</a></p> <p>NOW WATCH: <a href="https://www.businessinsider.com/what-if-jump-off-international-space-station-2018-6">What would happen if you jumped off the International Space Station</a></p>
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