17 October, 2024
Citigroup's VC arm invests in API security startup Traceable
In 2019, Jyoti Bansal co-founded San Francisco-based security company Traceable alongside Sanjay Nagaraj. With Traceable, Bansal — who previously co-launched app performance management startup AppDynamics, acquired by Cisco in 2017 — sought to build a platform to protect customers’ APIs from cyberattacks.
Attacks on APIs — the sets of protocols that establish how platforms, apps and services communicate — are on the rise. API attacks affected nearly one-quarter of organizations every week in the first month of 2024, a 20% increase from the same period a year ago, according to cybersecurity firm Check Point.
API attacks take many forms, including attempting to make an API unavailable by overwhelming it with traffic, bypassing authentication methods, and exposing sensitive data transferred via a vendor’s APIs.
“There’s a lack of recognition of the criticality of API security,” Bansal told TechCrunch in an interview, “as well as ignorance of the ever-growing attack surface in APIs and a resistance to embrace API security due to entrenched investments in security solutions that don’t address the API security problem directly.”
To Bansal’s point, more and more businesses are tapping APIs in part thanks to the generative AI boom, but in the process are unwittingly exposing themselves to attacks. Per one recent study, the number of APIs used by companies increased by over 200% between July 2022 and July 2023. Gartner, meanwhile, predicts that more than 80% of enterprises will have used generative AI APIs or deployed generative AI-enabled apps by 2026.
Traceable tries to shield these APIs by applying AI to analyze usage data to learn normal API behavior and spot activity that deviates from the baseline. Traceable’s software, which runs on-premises or in a fully managed cloud, can discover and catalog existing and new APIs, including undocumented and “orphaned” (i.e., deprecated) APIs in real time, according to Bansal.
“In order to detect modern threat scenarios, Traceable trained in-house models by fine-tuning open source large language base models with labeled attack data,” Bansal explained. “Our platform provides tools for API discovery, testing, protection and threat hunting workflows for IT teams.”
The API security solutions market is quickly becoming crowded, with vendors such as Noname Security, 42Crunch, Vorlon, Salt Security, Cequence, Ghost Security, Pynt, Akamai, Escape and F5 all vying for customers. According to Research and Markets, the segment could grow at a compound annual growth rate of 31.5% from 2023 to 2030, buoyed by the increasing threats in cybersecurity and the demand for more secure APIs.
But Bansal claims that Traceable is holding its own, analyzing around 500 billion API calls a month for ~50 customers and projecting revenue to double this year. Most of Traceable’s clients are in the enterprise, but Bansal says the company’s investigating piloting with governments.
“Traceable is building a long-term sustainable company, which from a financial perspective means that we have a very healthy margin profile that continues to improve as our revenue grows,” he said. “We’re not profitable today by choice, as we’re investing into the business responsibly. … Our focus is on strategic investments maximizing return, not simply spending.”
To that end, Traceable today announced that it raised $30 million in a strategic investment from a group of backers that included Citi Ventures (Citigroup’s corporate venture arm), IVP, Geodesic Capital, Sorenson Capital and Unusual Ventures. Valuing Traceable at $500 million post-money and bringing its total raised to $110 million, the new cash will be put toward product development, scaling up Traceable’s platform and customer engineering teams and building out the company’s partnership program, Bansal said.
Traceable currently has ~180 staffers. Bansal expects headcount to reach 230 by year-end 2024, as the bulk of the new investment goes to hiring.
“Traceable wasn’t fundraising, as we still had substantial cash runway prior to this investment,” Bansal said, adding that Traceable secured a “sizable” line of credit in addition to the new funds, “but we received significant inbound demand from investors. With the combination of the strategic alignment with Citi Ventures and the attractive terms of the investment, we decided to take a smaller investment now to accelerate our product and go-to-market initiatives before thinking about a more substantial fundraise.”
Now with $5M, Leal invests in AI-driven customer engagement for LatAm merchants
Leal, a Bogota, Colombia-based retail tech company providing customer engagement in Latin America, raised $5 million in a round that CEO Camilo Martinez called a “pre-Series B.”
LEAP Global Partners and Rakuten Capital co-led the round and were joined by Morro Ventures and Salkantay Ventures. The round comes about two years after the company raised $10 million in Series A capital, this one co-led by Rakuten and IDC Ventures. In total, the company has secured $20.5 million in venture-backed capital.
Leal works with business-to-consumer brands, e-commerce sites and financial institutions across Latin America to enable merchants to create a customer database to then offer cashback and rewards products to loyal shoppers on everyday purchases.
To do this, Leal has built integrations with 160 different point-of-sale systems. Most of the POS systems are local, however, Leal worked to integrate with big players in the United States and Europe that aren’t widely used in Latin America due to cost, Martinez told TechCrunch.
Also, merchants can track customer behavior and purchasing patterns for customers who traditionally pay with cash, a payment method notoriously known for being difficult to track. They also have access to campaign management tools for targeted communications.
Devolut leverages e-commerce growth in Latin America to develop reverse logistics tool
Martinez started the company in 2016 with Florence Frech, COO. At the time, the company was on “an amazing growth journey,” according to Martinez. Then the global pandemic happened.
“We lost 85% of our merchants,” he said. “We were heavily reliant on brick-and-mortar retailers. Lockdowns were some of the strongest ones after Asia, for example, over six months. We almost had to rebuild our business from 2021 onwards because we had no clients.”
Leal got its groove back. In 2021, the SaaS marketing company launched a new feature for grocery shoppers to scan paper receipts and earn Leal Coins that could be redeemed for goods and services like gasoline or food deliveries via Rappo. A year later, Leal expanded its rewards program throughout Mexico, Colombia and Central America.
Today, the company works with more than 1,000 brands across 15 industries and in eight countries. Its customer list includes Subway, Verifone and Chevron. Leal has more than 6 million users, up from 1.5 million in 2020, of which 3.5 million active users joined in the last 12 months.
“We’ve been developing a lot of gamification, so we can service our consumers in different ways,” Martinez said. “There’s an engagement path and smarter conversation tools so you’re not getting transactional messages, but you’re getting more human-like conversations. We’ve also been working on different marketing solutions to engage the consumer so we can be closer to their lifestyle and bring them bigger value.”
https://techcrunch.com/2023/12/01/big-wins-for-latin-america-climate-tech-momentum-and-rovers-2-3b-sale/
With the new investment, Leal plans to reach $10 million in annual recurring revenue, focus on additional penetration in Mexico, omnichannel communications and a set of tools that includes smarter data collection and interactions, and automation of benefits to maximize conversions.
It will also work on technology development to improve its artificial intelligence models for further personalization of app rewards and benefits. Martinez also wants to leverage generative AI for enhanced chatbot interactions between brands and consumers.
“Two of the channels we’re going to strengthen are WhatsApp and Facebook Messenger so we can have other sources on how to communicate with the consumer,” Martinez said. “With AI and GenAI, we can make better predictions with the data. We can increase experimentation and launch hundreds of different campaigns for customers to see what’s sticking with the consumer and then iterate with different AI models. We are also going to work on content creation so our platform is more personalized and automated to require less human intervention and be plug-and-play.”
Embracing digital commerce may be retailers’ best bet for staying ahead of a fast-moving industry
Google invests $350 million in India's Flipkart
Google is investing nearly $350 million in Flipkart, becoming the latest high-profile name to back the Walmart-owned Indian e-commerce startup.
As part of the deal, the Android-maker will also provide the Bengaluru-headquartered startup with cloud offerings, Flipkart said in a brief statement Friday. The Google investment is part of a nearly $1 billion funding round that Flipkart kicked off in 2023. Walmart has led the round, having invested $600 million in it late last year.
Flipkart, valued at over $33 billion, leads the e-commerce market in India, where it serves hundreds of millions of consumers in smaller cities and towns. The startup, which also owns the fashion e-commerce startup Myntra, commands about 48% of the Indian e-commerce market, according to Bernstein.
Flipkart competes with Reliance Retail, Amazon, SoftBank-backed Meesho and increasingly a number of quick-commerce apps. Reliance Retail — run by Asia’s richest man, Mukesh Ambani — operates the largest retail chain in India and is increasingly attempting to put together an e-commerce play. Reliance Retail was valued at $100 billion in a nearly $2 billion investment by QIA, ADIA and KKR last year.
India’s e-commerce market is estimated to be worth $133 billion by next year, according to Bernstein.
“Indian e-commerce is seeing emergence of challengers across quick/social/vertical commerce. Amazon and Flipkart remain leaders driven by category strengths in mobiles, consumer electronics and appliances. However, unlike large horizontal winners in global e-commerce market, India is likely to see category winners like Blinkit (quick commerce), Meesho (tier 2+ markets) and Nykaa (vertical commerce) as they scale up,” Bernstein analysts wrote in a recent note.
Google, which reaches more than half a billion people in India, identifies the South Asian nation as a key overseas market. The company unveiled plans to invest $10 billion in Indian businesses in 2020. (It has since invested $4.5 billion in the telecom operator Jio Platforms, and another $1 billion in Airtel.)
This is a developing story. More to follow.
Citigroup's VC arm invests in API security startup Traceable
In 2019, Jyoti Bansal co-founded San Francisco-based security company Traceable alongside Sanjay Nagaraj. With Traceable, Bansal — who previously co-launched app performance management startup AppDynamics, acquired by Cisco in 2017 — sought to build a platform to protect customers’ APIs from cyberattacks.
Attacks on APIs — the sets of protocols that establish how platforms, apps and services communicate — are on the rise. API attacks affected nearly one-quarter of organizations every week in the first month of 2024, a 20% increase from the same period a year ago, according to cybersecurity firm Check Point.
API attacks take many forms, including attempting to make an API unavailable by overwhelming it with traffic, bypassing authentication methods, and exposing sensitive data transferred via a vendor’s APIs.
“There’s a lack of recognition of the criticality of API security,” Bansal told TechCrunch in an interview, “as well as ignorance of the ever-growing attack surface in APIs and a resistance to embrace API security due to entrenched investments in security solutions that don’t address the API security problem directly.”
To Bansal’s point, more and more businesses are tapping APIs in part thanks to the generative AI boom, but in the process are unwittingly exposing themselves to attacks. Per one recent study, the number of APIs used by companies increased by over 200% between July 2022 and July 2023. Gartner, meanwhile, predicts that more than 80% of enterprises will have used generative AI APIs or deployed generative AI-enabled apps by 2026.
Traceable tries to shield these APIs by applying AI to analyze usage data to learn normal API behavior and spot activity that deviates from the baseline. Traceable’s software, which runs on-premises or in a fully managed cloud, can discover and catalog existing and new APIs, including undocumented and “orphaned” (i.e., deprecated) APIs in real time, according to Bansal.
“In order to detect modern threat scenarios, Traceable trained in-house models by fine-tuning open source large language base models with labeled attack data,” Bansal explained. “Our platform provides tools for API discovery, testing, protection and threat hunting workflows for IT teams.”
The API security solutions market is quickly becoming crowded, with vendors such as Noname Security, 42Crunch, Vorlon, Salt Security, Cequence, Ghost Security, Pynt, Akamai, Escape and F5 all vying for customers. According to Research and Markets, the segment could grow at a compound annual growth rate of 31.5% from 2023 to 2030, buoyed by the increasing threats in cybersecurity and the demand for more secure APIs.
But Bansal claims that Traceable is holding its own, analyzing around 500 billion API calls a month for ~50 customers and projecting revenue to double this year. Most of Traceable’s clients are in the enterprise, but Bansal says the company’s investigating piloting with governments.
“Traceable is building a long-term sustainable company, which from a financial perspective means that we have a very healthy margin profile that continues to improve as our revenue grows,” he said. “We’re not profitable today by choice, as we’re investing into the business responsibly. … Our focus is on strategic investments maximizing return, not simply spending.”
To that end, Traceable today announced that it raised $30 million in a strategic investment from a group of backers that included Citi Ventures (Citigroup’s corporate venture arm), IVP, Geodesic Capital, Sorenson Capital and Unusual Ventures. Valuing Traceable at $500 million post-money and bringing its total raised to $110 million, the new cash will be put toward product development, scaling up Traceable’s platform and customer engineering teams and building out the company’s partnership program, Bansal said.
Traceable currently has ~180 staffers. Bansal expects headcount to reach 230 by year-end 2024, as the bulk of the new investment goes to hiring.
“Traceable wasn’t fundraising, as we still had substantial cash runway prior to this investment,” Bansal said, adding that Traceable secured a “sizable” line of credit in addition to the new funds, “but we received significant inbound demand from investors. With the combination of the strategic alignment with Citi Ventures and the attractive terms of the investment, we decided to take a smaller investment now to accelerate our product and go-to-market initiatives before thinking about a more substantial fundraise.”