CAMBRIDGE — Fast-growing cybersecurity company eSentire has raised US$47 million and signed a lease for much larger offices in Waterloo.
The funds will be used to grow the firm, which currently is headquartered in Cambridge and employs about 300 people in offices on Pinebush Road and another 150 in other countries, said chief administrative officer James Yersh.
The investment announced Monday was led by Warburg Pincus, with Georgian Partners and Edison Partners participating as minority investors. The same private equity firms injected more than US$100 million in eSentire in August 2017.
"Georgian and Edison were the most significant investors prior to Warburg coming in so they stayed on and have continued to be supportive of the company in a number of different ways as well," said Yersh.
This summer, eSentire plans to move out of its offices at 278 Pinebush Rd. into a former BlackBerry building at 451 Phillip St. N. in Waterloo known as Factory Square. The new offices will have 65,000 square feet of space, more than double the size of the current location.
The company has outgrown its current office and the new location in an area of Waterloo branded as the Idea Quarter will help with recruiting developer talent coming out of the University of Waterloo, said Yersh.
The Factory Square location is next to the LRT station in the David Johnston Research and Technology Park and very close to UW.
"Where we are in Cambridge isn't necessarily the easiest bus ride to get to if you don't have a car," said Yersh. "And you know the struggles with the 401 even coming down here with a car isn't the easiest either."
In the competitive race for talent, the move to Waterloo takes one more obstacle off the table, said Yersh. He said eSentire will build a new security operations centre and front office that is much more impressive than what it has now.
Yersh knows the Phillip Street building well from his days at BlackBerry. He worked at BlackBerry for almost nine years and was the chief financial officer from 2013 to 2016.
"It is kind of bittersweet for me because when I was the CFO at BlackBerry I actually sold the building to the developers who bought it and now we are moving back in," he said. "Coming home."
Since it was founded in 2001, eSentire has created a new approach to cybersecurity. Instead of building firewalls and deploying anti-virus software, it adopted a method used by American military and security services called hunting.
The company assumes you are already breached and betrayed by a trusted insider. Personnel at eSentire's security operations centre sequester incoming and outgoing data for their clients, hunt for threats and then release it. That approach is known as managed detection and response or MDR.
With the rise of cloud computing and the widespread use of personal smartphones for business, hackers have more ways inside networks than ever before.
"Basically all of these things are making it more difficult for people to actually secure their data," said Yersh. "That's where we come in with managed detection and response."
Last October, eSentire acquired Versive Inc., a cybersecurity artificial intelligence company in Seattle that developed an automated platform for advanced threat detection.
"What we really plan to do is integrate those capabilities into our platform to be able to automate," said Yersh.
The market for managed security services is growing by nearly 17 per cent a year with global revenues expected to reach more than $24 billion by 2022, according to eSentire.
by Terry Pender
Terry Pender covers business and can be reached via Twitter @PenderRecord.