The company wanted to raise money before the election year was underway (companies sometimes don’t like to undergo major financing events during election years because of unpredictability in the markets) and actually completed the fundraising in December, Arctic Wolf CEO Brian NeSmith said in an interview with Crunchbase News. The money was intended to “build a war chest” so the company could be prepared for the future, he said.
Arctic Wolf is a “security operations center as a service” company, meaning it provides security experts to act as an extension of a company’s internal team and handle things like risk management and threat detection.
“For a long time, the managed security market has struggled with an acute shortage in security operations talent and misaligned pricing models,” Stereo Capital managing partner Dmitry Dakhnovsky said in a statement. “We are excited to back Arctic Wolf as the only scale platform that combines a state-of-the-art technology stack with top class security analysts in a single offering. Arctic Wolf brings true enterprise grade security to businesses who would not be able to achieve it on their own.”
Arctic Wolf is expecting to increase its headcount by 55 percent, and in about nine months it will begin international expansion. Currently, the company is mainly selling its services in North America, with Eden Prairie, Minnesota, and Waterloo, Ontario, as the largest company offices.
The new round comes after Arctic Wolf saw its customer base grow by 130 percent in 2019 and its revenue to about 115 percent, according to a statement from the company.
Arctic Wolf’s revenue has grown by 4,300 percent over the past four years, and it expects that to double this year. The company is on what NeSmith calls a “10-quarter plan” toward an IPO.
The company is also looking to make some smaller acquisitions in the future, though NeSmith declined to share what kind of companies Arctic Wolf is looking to buy. It has made one acquisition so far, cybersecurity startup RootSecure in December 2018.