Startups are increasingly looking at how companies in similar situations raise cash, such as the SolCyber funding situation. This company is a managed security service provider startup that secured $20 million in Series A funding from venture capital group Forgepoint Capital in 2021. This funding enabled the firm to continue its near-term growth and expand on its lofty goals for the future.
There’s no magic bullet when getting a cybersecurity firm off the ground, but examining how SolCyber attracted this investment from a significant player could provide ideas on how other startups can seek attention from venture capital groups. This guide will explore how SolCyber secured its funding and what other cybersecurity startups can do to attract investors with knowledge in the industry.
What Is SolCyber?
SolCyber is positioning itself as the first modern managed security service provider for the mid-market. Their technology assists organizations in monitoring, preventing, and responding to cybersecurity attacks using a dynamic approach that’s scalable based on the company’s needs.
The goal is to keep middle-market companies with revenues between $10 million and $1 billion safe from cyber attacks. Companies of that size are often overlooked by cybersecurity solutions and priced out of the market, an issue that SolCyber looks to address.
What SolCyber Will Do with This Funding
SolCyber raised $20 million in Series A funding, with most of the investment coming from Forgepoint Capital. It’s a good idea for other startups to consider what SolCyber will do with the money because their plan is part of the reason they’re an attractive investment. The company aims to:
-Hire More Employees
SolCyber only had 12 employees before securing its Series A funding, but its goal was to expand to 20 employees shortly afterward. Hiring additional employees would go hand-in-hand with the company beginning to turn a profit due to its growth in other areas.
-Expand Its Offerings
The company plans to use its secured funding to expand its cybersecurity offerings. Customers are always looking for solutions, and cybercrime is a continually evolving industry, so proactive service providers must adapt in real time. Becoming a leader in the cybersecurity industry is a goal for SolCyber, and offering additional products will assist in that regard.
Series A funding cash will assist as SolCyber builds brand awareness. Many mid-market companies are looking for the exact services this company provides but don’t know they exist or how to seek them out. Building awareness of their brand is a priority for SolCyber as they take the next step.
-Drive Customer Growth
These steps will contribute to the ultimate goal of driving further growth by attracting new customers in multiple industries. SolCyber has plans to increase revenues by providing service to more clients on a global scale, and their $20 million in funding will assist as they strive for them.
Every startup has different goals, but identifying how you’ll use any funding you secure can make you a more viable investment option for investors who understand the industry. Showing potential investors you have a plan makes you attractive to them.
5 Ways Startups Can Seek Similar Funding
The SolCyber 20m Series Forgepoint situation isn’t all that common. You can’t necessarily expect to secure $20 million in Series A funding as soon as you emerge from stealth. There are some further steps you can take when establishing your startup, though, that could catch the eye of investors:
1. Develop a Unique Product
SolCyber is taking a unique approach to cybersecurity by offering a tech stack package with advanced detection and response capabilities and email security. It also provides protection against active directory abuse and admin exploitation while training employees on security and phishing scheme avoidance. The result is a product that creates foundational security by protecting the customer in multiple ways.
2. Market to a Specific Customer
The package SolCyber offers is marketed with a specific customer in mind. This product isn’t something you’ll find in a household or a multinational because it’s meant for mid-market companies looking for a more robust cybersecurity solution at a price point they can handle. Creating a marketing plan that appeals to this customer will be a significant part of SolCyber’s growth plan.
3. Address a Known Problem
Hackers use the same techniques when attacking businesses of all sizes. Multinationals have the budget to invest heavily in cybersecurity, but many mid-market firms do not have the resources. This startup aims to address this problem and the gap in service as it expands via its SolCyber Series Forgepoint funding.
4. Show Expertise
The company’s expertise is one aspect that sets SolCyber apart from the crowd. The founders of this startup have significant cybersecurity experience, so investors have greater trust in their process. Startup founders don’t necessarily need industry experience, but they should surround themselves with experts if they don’t have this knowledge themselves.
5. Offer Immediate Results
Speed is the name of the game when it comes to cybersecurity. Firms don’t want to wait for the protection they need because time increases their chances of being victimized. SolCyber’s offerings immediately uplift a customer’s security posture and allow them to fight off advanced threats from cybercriminals.
Investors need a reason to believe a startup is primed to turn a profit and grow into an industry leader. Startups seeking funding must show they have the potential to check some of these boxes to attract significant funding.
How to Find Investors
Developing relationships with investors is challenging, especially for startups without industry contacts. You could have an excellent product and a viable business plan, but you’ll still need capital to get the idea off the ground.
Option3 offers cybersecurity investment consulting services and brings industry-savvy investors together with early-stage startups. We can put you in touch with investors who understand how your product benefits the cybersecurity industry, assisting as you secure the funding you need. Contact Option3 to learn more about our cybersecurity investment services.