Skyflow raises $7.5M to build its privacy API business

Skyflow, a Mountain View-based privacy API company, announced this morning that it has closed a $7.5 million round of capital it describes as a seed investment. Foundation Capital’s Ashu Garg led the round, with the company touting smaller checks from Jeff Immelt (former GE CEO) and Jonathan Bush (former AthenaHealth CEO).

For Skyflow, founded in 2019, the capital raise and its constituent announcement mark an exit from quasi-stealth mode.

TechCrunch knew a little about Skyflow before it announced its seed round because one if its co-founders, Anshu Sharma is a former Salesforce executive and former venture partner at Storm Ventures, a venture capital firm that focuses on enterprise SaaS businesses. That he left the venture world to eventually found something new caught our eye.

Sharma co-founded the company with Prakash Khot, another former Salesforce denizen.

So what is Skyflow? In a sense it’s the nexus between two trends, namely the growing importance of data security (privacy, in other words), and API-based companies. Skyflow’s product is an API that allows its customers — businesses, not individuals — to store sensitive user information, like Social Security numbers, securely.

Chatting with Sharma in advance of the funding, the CEO told TechCrunch that many providers of cybersecurity solutions today sell products that raise a company’s walls a little higher against certain threats. Once breached, however, the data stored inside is loose. Skyflow wants to make sure that its customers cannot lose your personal information.

Sharma likened Skyflow to other API companies that work to take complex services — Twilio’s telephony API, Stripe’s payments API, and so forth — and provide a simple endpoint for companies to hook into, giving them access to something hard with ease.

Comparing his company’s product to privacy-focused solutions like Apple Pay, the CEO said in a release that “Skyflow has taken a similar approach to all the sensitive data so companies can run their workflows, analytics and machine learning to serve the customer, but do so without exposing the data as a result of a potential theft or breach.”

It’s an interesting idea. If the technology works as promised, Skyflow could help a host of companies that either can’t afford, or simply can’t be bothered, to properly protect your data that they have collected.

If you are not still furious with Equifax, a company that decided that it was a fine idea to collect your personal information so it could grade you and then lost “hundreds of millions of customer records,” Skyflow might not excite you. But if the law is willing to let firms leak your data with little punishment, tooling to help companies be a bit less awful concerning data security is welcome.

Skyflow is not the only API-based company that has raised recently. Daily.co picked up funds recently for its video-chatting API, FalconX raised money for its crypto pricing and trading API, and CNBC reported today that another privacy-focused API company called Evervault has also taken on capital.

Skyflow’s model, however, may differ a little from how other API-built companies have priced themselves. Given that the data it will store for customers isn’t accessed as often, say, as a customer might ping Twilio’s API, Skyflow won’t charge usage rates for its product. After discussing the topic with Sharma, our impression is that Skyflow — once it formally launches its service commercially– will look something like a SaaS business.

The cloud isn’t coming, it’s here. And companies are awful at cybersecurity. Skyflow is betting it’s engineering-heavy team can make that better, while making money. Let’s see.

Post by startupsnows.blogspot.com