Pentera Secures $60M to Boost AI-Powered Security Validation

A security validation vendor led by an ex-Israel Defense Forces captain raised $60 million to boost cloud penetration and accelerate growth in the U.S. market.

See Also: From Silos to Synergy: Gen AI Aligns IT and Security Teams

The Series D funding will help Boston-based Pentera develop broader compatibility with major cloud providers and use artificial intelligence to communicate effectively with different business personas, said CEO Amitai Ratzon. While Pentera was not in urgent need of cash, Ratzon said the money will allow for advancements in research and development, particularly around AI-driven security validation.

“We’re not truly in a situation where we’re hungry for cash,” Ratzon said. “We’ve been very efficient. We’ve been building a global sales and marketing machine for many years. We’ve been quite quiet on fundraising for the past three years, because we’ve been really focused on heads-down execution.”

What Set Evolution Equity Apart as an Investor

Pentera, founded in 2015, employs 410 people and has raised $250 million in outside funding, with the firm previously closing a $150 million Series C funding round in January 2022 led by K1 Investment Management. The company has been led since January 2018 by Amitai Ratzon, who previously spent four years as an infantry captain in the Israel Defense Forces before spending two decades in sales (see: Pentera CEO on How Firms Should Respond to Attack on Israel).

Unlike many firms in today’s economic climate that accept structured deals – where investors demand guaranteed returns regardless of the company’s performance – Ratzon said Pentera insisted on terms in which investors would share the same risks as the company’s founders and employees. Pentera is rapidly scaling toward $100 million in annual revenue, backed by 1,100 organizations worldwide.

“We weren’t actively looking, it had to be said,” Ratzon said. “But Evolution Equity Partners, which is the current investor on the balance sheet, basically said, ‘Hey, we want to lead. We’ve just raised a fund of $1.1 billion.'”

Ratzon said Evolution’s experience as hands-on practitioners gives Pentera operational insights, strategic direction and deep industry connections, including a board member with direct practitioner experience. Evolution specializes in cybersecurity investments, ensuring that the company’s expertise, connections and guidance are specifically tailored to the challenges and opportunities within this sector, Ratzon said.

“If you want to invest in cybersecurity, you want an investor who really understands your domain,” Ratzon said. “That’s also very helpful when it comes to introductions and connections.”

How Pentera Plans to Put the Series B Funding to Work

A large portion of the Series D money will go toward enhancing Pentera’s AI-driven attack simulation and automation capabilities to improve attack sophistication and make security validation more realistic and effective. Another major initiative is using generative AI to translate security insights into business language, helping business leaders understand security risk without needing deep technical knowledge.

“The new money will be used to maintain the platform, which is a big thing to come up and maintain. It will be used to introduce AI into the product in various ways,” Ratzon said. “One is AI for attack sophistication, attack orchestration to make everything we do we have sharper, smarter, faster.”

Many security reports are too technical for non-technical executives. Pentera’s AI-driven reporting will tailor insights to different audiences, giving CISOs a deep technical breakdown with giving CEOs a high-level risk assessment, he said. Pentera originally operated in a nearly uncontested market, but as cybersecurity validation gained traction, competitors such as AttackIQ, Cymulate and XM Cyber emerged.

“If you’re a CIO, you receive a report that speaks your language,” Ratzon said. “If you’re a CEO, you receive a report without having to understand the bits and bytes of the actual platform that the techies are really obsessed with.”

Pentera aims to reach $100 million in revenue by the end of 2025, maintain customer retention of more than 90%, optimize its sales-to-support staff ratio to ensure lean growth, and adopt a biweekly update system for faster cybersecurity improvements. With 1,100 customers, Ratzon said Pentera’s priorities must be shaped by their needs, with a focus on ensuring client feedback influences product development.

“Everyone is recognizing that Pentera is the market leader that will consolidate the market,” Ratzon said. “That is a clear thing. It makes us very humble, but at some point, someone should be basically the market leader, and that is us.”