Small and medium-sized businesses (SMBs) are the new target of cybersecurity threats. With one in three SMBs experiencing a cyberattack last year, the need for protection has skyrocketed. To address this need, London and Tel Aviv-based startup Cynomi announced it has raised $37 million in funding.
The investment round was led by Insight Partners and Entrée Capital, with participation from Canaan, Flint Capital and S16VC, who previously backed Cynomi. The company is now valued at more than $140 million, according to people familiar with the deal.
Cybersecurity with AI: The Virtual CISO Concept
Cynomi’s flagship product is a virtual CISO (Chief Information Security Officer), powered by artificial intelligence and providing automated security management for small businesses. It not only provides analysis and risk detection, but also performs a wide range of functions, such as policy development, monitoring, network vulnerability detection, optimization recommendations, and status reports.
Cynomi provides its services not directly to companies, but through telecom operators and managed service providers (MSPs). This model has allowed the company to attract more than 100 partners in a short time, including large providers such as Deutsche Telekom.
Market problem and solution
While large companies were previously the main target of cybercriminals, now they are actively attacking the SMB segment through AI and automation tools. SMBs are left vulnerable due to budget and staffing shortages. Cynomi fills this gap with an affordable and effective solution.
“While traditional CISO services start at $100,000 per year, a virtual CISO starts at just $10,000-$12,000,” says Roy Azoulay, the company’s COO. In addition, the AI-powered CISO will operate 365 days a year.
Future plans
Cynomi has tripled its annual recurring revenue (ARR) over the past year. Currently, 80% of its customers are located in the US, and the company plans to expand its operations to Europe and other regions. The investments raised will be directed to R&D and business development.
Noting that the $163 billion cybersecurity consulting market still lacks a single operating system, Azoulay said, “Cynomi can become that system.”
Investor opinion
Insight Partners director Philine Huizing praised Cynomi’s “vCISO” approach as a new category, praising the company’s ability to create a flexible and enriched offering through MSP.
