Zero Networks Secures $55M in Series C Funding to Accelerate Zero Trust Expansion

Zero Networks, a startup specializing in microsegmentation, has successfully secured $55 million in funding to enhance its offerings surrounding identity segmentation and zero trust network access. Under the leadership of Benny Lakunishok, a former Microsoft product manager, the company aims to tackle the last-mile security challenges that traditional network security frameworks often overlook.

The Series C funding round, led by Highland Europe, positions Zero Networks to expand its workforce from 120 employees and increase its international sales presence, targeting a transition from 30% to 40% of total sales outside North America in the coming years. “It’s preemptive, meaning we don’t have to do any fundraising,” Lakunishok explained to Information Security Media Group, emphasizing the accelerating demand for their solutions.

Founded in 2019, Zero Networks has raised over $100 million, including a previous $20 million Series C round in December 2023. Lakunishok, who has over 11 years of experience at Microsoft, guides the company while expanding its footprint in the identity segmentation and ZTNA markets, deemed critical for future growth.

Zero Networks’ Strategy in Focus

Lakunishok highlighted the untapped potential in identity segmentation, which aims to fill gaps left by traditional Privileged Access Management systems. ZTNA serves as the external-facing aspect of Zero Trust architecture, aligning with Zero Networks’ existing product suite. Responding to customer demands, the company intends to aggressively enter this burgeoning sector.

Unlike traditional microsegmentation that focuses on network behavior, identity segmentation emphasizes user identity control, allowing organizations to limit access for service accounts and privileged users. Lakunishok noted that visibility remains a significant challenge, as many organizations are unaware of the extent of their service account usage and the actions taken by those accounts.

On the ZTNA front, Lakunishok expressed concerns about traditional vendors heavily relying on reverse proxies and cloud tunneling, which can introduce inefficiencies and visibility issues. Zero Networks employs a just-in-time, peer-to-peer approach that dynamically opens ports after MFA authentication, upholding zero trust principles without sacrificing performance.

Differentiation in a Competitive Landscape

In a market where competitors such as Illumio and Akamai often utilize agent-based deployments and manual processes, Zero Networks sets itself apart with an agentless architecture that integrates with existing OS-level firewalls and automated segmentation. This innovation allows for more scalable, effective security measures with minimal human intervention.

Zero Networks has ambitious plans to establish core hubs in key regions, including Japan, Singapore, and various European countries, alongside expanding its operations across the U.S. The company strives to exceed $100 million in annual recurring revenue within two years, using geographic diversification both as a target and as an indicator of growth potential.

Asserting the importance of maintaining a strong presence in the market, Lakunishok emphasized that once potential customers discover their capabilities, they often convert into clients due to the efficacy of their solutions. “We just need to be in front of more prospects that have the need, and we can provide assistance,” he stated, underscoring the momentum as Zero Networks aims to redefine network security.