Adlumin Raises $70M, to Debut RMM, Cloud Configuration ToolsSeries B Funding Will Allow Security Operations Vendor to Pursue Product-Led Growth
A mid-market security operations vendor founded by a former Marine Corps officer closed its Series B funding round to help pursue a product-led growth strategy.
Washington D.C.-based Adlumin will use the $70 million to launch free tools in the cloud configuration and remote monitoring and management spaces and familiarize SMB and mid-market companies with the company's product portfolio, said founder and CEO Robert Johnston. The funding round was led by SYN Ventures, who Johnston praised for the track record and success in building value in cybersecurity.
"We have really big, audacious and ambitious goals for next year, and we wanted to make sure that from a capitalization perspective, we're aligned up to achieve those goals," Johnston told Information Security Media Group. "It takes different skills to build security companies than to build a company in other industry verticals."
Adlumin was founded in December 2016, employs 150 people and raised the initial $25 million chunk of its Series B funding in December 2021. The company was started by Johnston, who had led the probe into the Russian Foreign Intelligence Services' breach of the Democratic National Committee and was the leader of the 81 National Cyber Protection Team during his nearly eight years in the Marine Corps (see: Cybersecurity: How to Manage Business Risk).
Pursuing Product-Led Growth
Johnston said remote monitoring tools are a very common entry vehicle for ransomware operators since they introduces a layer of complexity and vulnerability that small and mid-sized businesses can't control. But smaller organizations are often completely dependent on RMM products since their businesses have only endpoints and cloud and no network edge, he said.
In addition, cloud-based email tools such as Microsoft 365 are the most dangerous place on the internet, and Johnston said the problem will only get worse as single sign-on becomes more pervasive. Adlumin currently plans to build both its RMM and cloud configuration management products organically since the company has a robust development team, but Johnston said the company would be open to M&A opportunities.
"We have really big, audacious and ambitious goals."
– Robert Johnston, founder and CEO, Adlumin
Adlumin's product-led growth initiative will be headed by a new chief product officer and focus on launching tools that give the company an opportunity to introduce prospects to the rest of the portfolio. From a user experience standpoint, Johnston said Adlumin will make the interaction between people using data and the data itself simpler and more responsive to give customers a sharper experience.
Bringing SecOps, MDR Together for the Mid-Market
From a go-to-market standpoint, Johnston wants to grow Adlumin's footprint outside North America from approximately 10% today to 40% within the next three or four years. The company already has a presence in Latin American, Europe, Canada and New Zealand thanks to its channel partners, and it will lean on both existing and new channel partners to introduce Adlumin to customers in new geographies.
Adlumin's security operations software competes against SIEM and security analytics vendors such as Rapid7, LogRhythm, ManageEngine and SolarWinds, while the firm's managed detection and response services rival other mid-market providers such as Arctic Wolf and eSentire, Johnston said. Adlumin stands apart from its rivals by offering both security software and MDR services to the mid-market, he said.
The company's average customer has approximately 300 employees, though Johnston said Adlumin serves organizations ranging from just 10 employees to as many as 10,000 employees. Johnston wants to grow Adlumin's headcount from 150 workers today to more than 200 employees by the end of 2024.
From a metrics standpoint, Johnston will closely monitor financial figures including topline revenue and gross margins as well as typical SaaS calculations around burn multiples, customer acquisition costs and payback period. As far as operational metrics are concerned, Johnston said he's most focused on partner recruitment growth since 90% of Adlumin's new end user companies are sourced through the channel.
"Recruiting a channel partner is a lot like recruiting a customer," Johnston said. "We know that in order to hit revenue targets, we need to meet certain partner recruitment figures."