IT trends monitor Spiceworks revealed in its 2021 State of IT Report that the glut of security concerns coinciding with an uptick in COVID-19 remote work has motivated businesses to prioritize managed security services spending. Companies of all sizes are doubling down on ensuring safety for online operations, particularly with the recent hacks of SolarWinds and Microsoft Exchange through email server authentication manipulation. It’s unsurprising that network security is climbing the service provision ladder of importance, now taking the #4 spot for categorical MSP budget allocation.
Engaging a cybersecurity insurance provider is a savvy expenditure that’s become more common as the scalability potential of data breaches means total ruination could result from a single point-of-entry hack. Contracting an MSSP and procuring an insurance policy sets up a steady line of defense, and it’s fitting that the company carving out its stake by combining these security strategies into its platform is taking the market by storm.
Cybersecurity company Coalition will be able expand its horizons beyond the insurance/MSSP combination innovation with a Series D funding round led by venture capital firm Index Ventures. The $175 million from this round brings Coalition’s funding total to $300 million, with the capital being used for insurance policy development and international business expansion. The company acquired search engine platform BinaryEdge in 2019, integrating its technology to offer customers a new angle of threat detection for devices and servers.
There are further leaps and bounds for IT security technology to navigate, and taking into account the hefty investments being made, other MSSPs might be wasting time if playing copycat. Coalition’s Chief Executive Officer and Co-Founder Joshua Motta said, "Our ambitions now extend beyond cyber insurance. Nearly one in ten Fortune 500 companies is an insurance company, yet most were founded before World War II. With this funding, we plan to bring our technology-driven approach to other lines of commercial insurance as we seek to build the digital insurance company of the future."
Coalition, founded in 2017, works mostly with U.S. and Canadian companies, maintaining a diverse portfolio of policies across industries. Cyber insurance policies of up to $15 million can be taken out to protect security incidents from financial liability. An example of the more creative policies often drawn is “reputational repair,” a sort of public relations business consideration that saves face for a company in the event of a major, public breach.
Coalition has achieved a $240 million gross written premium run-rate, with a customer base of over 41,000. The company is leading the MSSP market’s financial boom, as outsourced expert help incorporated with the inspired concept of custom-made security insurance has become the most cost-effective way for a business to stay current on IT systems security.