|By Maureen O'Gara||
|January 14, 2013 08:30 AM EST||
Industry glitterati have stuffed $26 million in the pockets of Shape Security, a start-up promising to deliver a mysterious new kind of web protection that will make it harder and pricier for hackers to ply their trade.
The company says the number of large-scale web security incidents has increased exponentially in the past decade. Symantec estimates the overall cybercrime market at $388 billion a year. Last month the FBI took down a single botnet that alone stole over $850 million.
Ray Rothrock, a partner in Venrock, the pioneering high-tech venture capital firm started by the Rockefellers and led the new $20 million B round in Shape, said, "The rise of botnets and crimeware-as-a-service have led to an untenable situation where web sites are now cheap to attack and expensive to defend. Shape's technology will alter this balance. It is unlike anything the industry has ever seen before."
Also participating in the round were Kleiner Perkins, Allegis Capital, Google Ventures, Google executive chairman Eric Schmidt's personal VC arm TomorrowVentures and former Symantec CEO Enrique Salem.
Last April Shape closed a $6 billion A round led by Kleiner and including TomorrowVentures, Google Ventures, Baseline Ventures and top executives from Dropbox, Facebook, LinkedIn and Twitter.
The start-up is being fairly closed-mouth about its self-proclaimed military-grade widgetry. Salem, who figures "signature and heuristic-based detection have proven unsuccessful in keeping pace with the complexity of modern web attacks," said Shape's technology "will allow web sites to deflect attacks automatically, using a far more sophisticated approach." Apparently the hacker would be forced to compromise a web site every time a user logs on instead of reusing a stolen identity.
Evidently the widgetry has been in beta at unidentified customers sites assumed to include large financial institutions who sound like they want Shape to hurry up and productize the stuff - hence the B round. It could have a software appliance out later this year.
The start-up was founded in 2011 by CEO Derek Smith, CTO Justin Call and VP of product management Sumit Agarwal. Agarwal was the head of mobile product at Google and worked at the Defense Department. The company has also added Google's former click fraud boss, Cisco's former VP of application delivery and Wal-Mart's ex-chief information security officer.
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