Startup News: Cloud security platform Wiz raises $300M

While artificial intelligence may have captured America’s imagination in recent months, the decidedly less flashy cybersecurity industry continues to attract the attention of venture capitalists. Funding in the cybersecurity sector totaled a respectable $18.5 billion in 2022, according to Momentum Cyber, a cybersecurity investment bank.

A leader in the industry is three-year-old Wiz, a cloud security platform, which announced last week that it has raised $300 million in a Series D funding round led by Lightspeed Venture Partners and existing investors Greenoaks Capital Partners and Index Ventures. The funding round brings the company’s valuation to $10 billion as of March 2023.

According to New York City-based Wiz, the demand for its product is evident in customer validation from more than 35% of Fortune 100 companies, including BMW and Morgan Stanley, as well as other leading companies such as Salesforce, Slack, Colgate, and Blackstone. Assaf Rappaport, Wiz’s CEO, says that the new cash will be put toward product development and hiring well into the new year.

Instacart Generates Higher Sales in Fourth Quarter

Meanwhile, The Wall Street Journal reported last week that Instacart, the grocery-delivery firm, generated sharply higher sales and profits in the fourth quarter, according to people familiar with the matter and an internal memo, as the company prepares for its highly anticipated IPO.

According to a memo viewed by the Journal, Instacart told employees that its revenue increased more than 50% in the fourth quarter, compared with the same period a year earlier, while gross profit rose more than 80%.

“Instacart’s full-year revenue increased 39% to about $2.5 billion for 2022, people familiar with the matter said, as the company reaped the benefits of a push into advertising while it has struggled to increase order volume at the same pace it did during the height of the Covid-19 pandemic,” the Journal added.

The company, which had a valuation of $39 billion as of February 2021, filed confidentially for an IPO last year but like many startups decided to push back its plans, citing turbulent market conditions.

But this kind of quarterly performance, combined with an improvement in market conditions, might push Instacart to finally “deliver” on its long-waited plans for an IPO before year’s end.

Online Bank Varo Raises $50 Million at $1.8 Billion Valuation

While few startups are going public these days, venture capitalists continue to provide needed funding. An article in TechCrunch reported last week that Varo, a San Francisco-based online bank, is raising a $50 million equity round led by Warburg Pincus that effectively values the bank at $1.8 billion, which is $700 million lower than it was valued in September 2001 when it raised an oversubscribed $510 million Series E round.

In an interview with TechCrunch, CEO and founder Colin Walsh last September insisted that the company was “still seeing strong customer growth” and still had “a clear path to profitability.”