KnowBe4 gets backing from private equity giant KKR

Cybersecurity training firm KnowBe4 in Clearwater is poised to get a “sizable” minority investment from KKR, one of the largest private equity firms in the world.

Ten Eleven Ventures, a venture capital firm focused on cybersecurity investments, also is participating in the funding round.

The investment values KnowBe4 at more than $800 million, according to a news release that did not disclose the size of the investment.

Stu Sjouwerman, CEO, KnowBe4

KKR is making an initial commitment of $50 million, with plans for additional funding, Fortune reported, citing sources with knowledge of the deal.

KnowBe4, founded in 2010 and led by CEO Stu Sjouwerman, has received two previous rounds of funding — an $8 million venture capital investment from Elephant Partners in January 2016, and a $30 million Series B investment led by Goldman Sachs in October 2017.

KnowBe4, No. 96 on the Inc. 5000 with $64.5 million in 2017 revenue, said it had revenue growth of 110 percent in 2018 and more than $120 million in bookings. The company has had 23 consecutive quarters of growth.

Sjouwerman told Fortune that the company will use the new capital to expand in Europe and open new offices in Dubai and Singapore.

KnowBe4 helps organizations reduce their risk of a cyberattack by educating users to recognize, report and avoid threats.

“Cyber security training that helps every employee do his or her part to defend against attacks, especially as related to preventing the sophisticated spear phishing attacks we’re currently seeing, is more critical than ever,” Mark Hatfield, founder and general partner at Ten Eleven Ventures, said in the news release.

KKR also likes the approach of working with employees to help them make smarter security decisions.

“We’ve seen global spending on cyber security solutions grow to $48 billion, yet despite this investment, breaches, and the severity of these breaches, continue to be on the rise – over 90 percent of which involve inadvertent human error. We believe employees represent an organization’s first and last line of defense,” said Stephen Shanley, director at KKR.

Elephant and Goldman Sachs have done “a great job positioning the business to scale,” said Patrick Devine, principal at KKR.

KKR is investing through its Next Generation Technology Fund, which focuses on investments in software, security, internet, digital media and information services.