Cato Networks, a startup that manages software-defined networking, manages cybersecurity and global backbone services into a single platform, today announced that it had raised $238 million in an equity investment that valued the company at more than $3 billion.
Cato's total raised was $770 million, with participation from Singtel Innov8, Adams Street Partners, SoftBank Vision Fund 2, Sixty Degree Capital and Adams Street Partners.
In 2015, Cato, a multi-faceted entrepreneur, was launched after co-foundering Check Point, the IT security firm, and Imperva, which provides risk-monitizing and risk management solutions for businesses. With Cato, Kramer, a computer scientist and mathematician by education, sought to create a platform and architecture that minimized the complexity, costs, and risks associated with legacy approaches to network security.
Cato's product is based on a cloud-based mesh that enables businesses to connect to network resources regardless of where they are. Cato operates points of presence-access points to its and other networks worldwide that deliver Cato's aforementioned networking and security resources.
With its database, Cato provides security information with all the metadata of network flows from every device and customer connected to its cloud. In-house training and analysis, Kramer said, Cato creates robust AI models for security and management applications like data loss prevention and malicious file detection over the network.
Cato's network is a software-defined wide area network, as the name suggests, that uses software to regulate the connectivity, management and services between network-connected devices and cloud resources. The SASE is also a SASE, which means that the network and security controls are delivered directly to the source of connection rather than a data center.
SASEs and SD-WANs have become more popular as workers and applications become widely distributed - as companies count on the increasing volume of devices on their networks. A recent survey from Omdia projects suggests that in 2025, SD-WAN revenue will reach $6.4 billion, up $600 million from the previous forecast. The Dell network now has more than 670,000 remote users connected across its customer base of more than 1,900 businesses, and the company has crossed the $100 million recurring revenue mark in the past year.
The endgame for Cato will be to go public within the next year, Kramer said. The latest round of funding will not derail those plans, he says, or so he asserts.
Kramer said there was no need to talk about the upcoming deal, and that he was confident he would be able to make the deal happen in the next few weeks. We've adapted to the changing landscape and have experienced growth, he said. Our financial position and growth strategy enable us to weather potential headwinds effectively, including any broader tech industry slowdown... We're dedicated to maintaining a sustainable financial model that supports our growth objectives.