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KKR invests $300M in KnowBe4

Margie Manning

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The staff at KnowBe4.

The Tampa Bay area just got another unicorn.

KnowBe4, a cybersecurity training company in Clearwater, received $300 million in an investment round led by KKR and with significant participation by two existing investors, Elephant and TenEleven Ventures.

Stu Sjouwerman, CEO, KnowBe4

KnowBe4 will use the funding to grow globally and to further develop its platform, which helps companies cut the risk of a cyberattack by training workers to respond to attempted threats.

“Threats like phishing, ransomware and other forms of social engineering continue to plague organizations of all sizes, meaning the market for our security awareness training is growing at a rapid pace,” Stu Sjouwerman, KnowBe4 CEO, said in a news release. “The relationship we started with KKR earlier this year has been fruitful for both of us.”

In March, KKR led what was described as a “sizable” investment in KnowBe4.

Fortune reported that KKR’s initial investment was $50 million and the round announced this morning brings the total investment in KnowBe4 to $350 million.

The latest deal values KnowBe4 at $1 billion — the benchmark for a tech startup to reach “unicorn” status. Only one other local company has claimed that distinction. ConnectWise, a managed IT services provider and software developer in Tampa, said it was valued at $1.2 billion when it was acquired by private equity firm Thoma Bravo in February.

However, ConnectWise, founded in 1982, was considerably older than the startups or young firms that typically are labeled unicorns.

Sjouwerman, a serial entrepreneur, founded KnowBe4 in 2010 and the company has grown rapidly. KnowBe4 has over $100 million of recurring revenue, near triple-digit growth, and a customer base of over 25,000 organizations across all industries, including highly regulated fields such as finance, healthcare, energy, government and insurance, the news release said.

The company’s Tampa Bay base is a “massive competitive advantage,” Sjouwerman said at last month’s poweredUP, Tampa Bay Tech’s technology festival.

KnowBe4 also has expanded outside the United States, including the acquisition last month of CLTRe, a Norwegian business focused on working with organizations to beef up their culture around online security.

This year is shaping up as another record year for KnowBe4, Stephen Shanley, director at KKR, said in the news release. He called KnowBe4 “a category-defining asset.”

“Cyber threats are not going to be solved with technology alone; the human side of the equation matters and KnowBe4 is making important contributions in this area,” said Patrick Devine, a principal at KKR. “We’re very excited to watch the company continue to scale globally and meet market demand for security awareness training and testing that actually works.”

KKR is investing through its Next Generation Technology Fund, a $711 million fund that invests in technology, media and telecommunications firms.

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