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Why Sequoia Just Led A $17 Million Series A In This Access Management Software Startup

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StrongDM, a single sign-on company for backend infrastructure, announced today that it has raised $17 million in Series A led by Sequoia Capital.

Cofounder and CEO Elizabeth Zalman says that back in the day in order for an employee to get access to infrastructure, companies had active directory sitting on top of one database and only a few people had access to it (privileged administrators or systems administrators). With the rise of the cloud and the explosion of more data sitting in more places and  more people needing access to it, these traditional approaches to control access stopped working. 

“If you’re going to manage access for infrastructure that could be sitting in the data center or a cloud, you need to be able to handle every cloud, every database or server type, and you need to do it in one simple intuitive interface that anybody can adopt,” Zalman says. “StrongDM enables administrators and people who manage infrastructure to both manage and audit access to that infrastructure, no matter where it is and no matter where the people that need access to it are.” 

The way strongDM works is instead of handing out usernames or passwords, users download a piece of software to their computer. They are then able to log in, get authenticated through single sign-on provider (like Okta or OneLogin), and once the user has been granted access they have a list of resources that they get access to.

StrongDM grants the access, mediates it, and also logs every single thing that the developer is doing in a video replay.

“We get you in the front door, we get you access to the small thing that you need and then watch what you’re doing,” Zalman says.   

StrongDM offers only one plan which costs $50 per user per month. The company has grown 3x over the last year, and counts 100 customers, including names like Hearst, SoFi, and Peloton. 

Prior to cofounding strongDM, Zalman cofounded digital marketing platform Media Armor in 2010, which she sold to Nomi in 2014, after raising two rounds (including a $2 million Series A led by Greycroft). Zalman cofounded strongDM in 2015 with her friend from high school Justin McCarthy (CTO), and the ex-VP of marketing at Nomi, Schuyler Brown (VP of Customer Success). 

Billionaire Douglas Leone, global managing partner at Sequoia Capital, who led the Series A round says that there are more and more databases and lots of employees all over the place, which makes it harder for large companies to keep track of who has access to what.

“As more people have more access to different databases or servers you can’t keep track of all this manually, so what you need is automated systems,” Leone says. “We saw that strongDM’s solution would be aimed at the future when the problem is only going to get worse.” 

The Burlingame-based company, which currently counts 35 employees, has previously raised $5 million across a pre-seed and a seed round. With the latest latest $17 million Series A, the total amount of equity financing in the company has grown to $22 million.

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