Israel cyber security company Radiflow has announced the closing of an $18 million financing round. The round was led by Singapore Technologies Engineering Ventures (ST Engineering). Radiflow's existing investors, including Zohar Zisapel, also took part in the round.
The company will use the funds raised to expand its sales network in order to support the growing demand in the market, strengthen its brand around the world, and continue developing innovative solutions for meeting the growing needs of its customers.
Radiflow develops cyber security products for large industrial enterprises. Its products include industrial control systems (ICS) and supervisory control and data acquisition systems (SCADA) protecting industrial maintenance networks of 50 critical infrastructure enterprises, including power production, water facilities, and so forth. The company was one of the pioneers in this area, and currently has over 50 customers worldwide, including critical infrastructure enterprises in the US and Europe. Radiflow has 35 employees including five overseas and is now planning to increase its staff to 50.
Radiflow founder and CEO Ilan Barda told "Globes," "Our main goal right now is to grow in market and sales, because up until now, we've focused on specific customers. In the next stage, we'll enter and create more strategic partnerships, as we did with Palo Alto several months ago."
Barda says that ST Engineering's investment in Radiflow is an important step both in integrating ST Engineering's automation solutions in Radiflow's products and in opening Asian markets to the company. "They have offices in many Asian countries and they are a respected partner with great credibility."
ST Engineering has 22,000 employees in its offices in Asia, the US, Europe, and the Middle East. Its revenue totaled $4.9 billion in 2017. The group developed from the defense and aeronautics industry, but in recent years has entered industrial automation, command and control systems, and other fields. Barda says that this is the background for its connection with Radiflow, which focuses on security for automation and critical infrastructure networks.
According to Barda, the company's current sales volume amounts to several million, but it has not yet reached break-even, because it is spending heavily on set-up and technical support for each deal. "Actually, every sale we make is an investment. We will break even when the customers buy solutions corresponding to their size, meaning millions of dollars for a deal instead of tens or hundreds of thousands of dollars. It will take a few more years before we reach the market of the big numbers, and then it's possible that the big players will take an interest in us."
Cyber risk in the conservative industrial market recently drew attention following two focused attacks: the case of the Triton malware attack and IT-based attacks, including cryptocurrency mining malware, which Radiflow's iSID system detected in a sewage facility. Against these challenges Radiflow presents its advanced industrial cyber security solutions and its strategic partnership with the rapidly developing ecosystem, including the recently revealed cooperation with Palo Alto Networks and RSA, in order to improve the process of deployment in the field and ensure that it would meet new standards, including US NERC CIP and the EU NIS directive.
The investment and partnership provide ST Engineering with access to Radiflow's detection and prevention tools, which have been integrated in the command and control systems and C3 communications systems of railways - at this stage, on data (SCADA) supervisory, command and control system of railways. The combination of these two technologies resulted in the development of the first end-to-end cyber security solution for the railway transportation industry in the region.
"The current investment in Radiflow proves the focus of ST Engineering on identifying opportunities for cooperation with startups having the best technology in the world. Access to our established business networks and channels will help these companies grow and accelerate their growth and develop solutions useful to our customers throughout the world," says ST Engineering chief strategy officer Low Ka Hoe.
Published by Globes [online], Israel business news - www.globes-online.com - on July 11, 2018
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