Bugcrowd Secures $50 Million Growth Capital Facility from Silicon Valley Bank

Rhea-AI Summary

Bugcrowd has secured a $50 million growth capital facility from Silicon Valley Bank (SVB), a division of First Citizens Bank. The financing, provided by SVB's Enterprise Software Group, will be used to scale Bugcrowd's AI-powered platform globally, fund platform innovation, and pursue strategic M&A opportunities. Bugcrowd's crowdsourced cybersecurity solutions have served over 1,200 customers including OpenAI, Google, T-Mobile, and the US Department of Defense. The company's 'skills-as-a-service' approach has proven effective in uncovering high-impact vulnerabilities across various digital infrastructures.

Positive

• Secured $50 million growth capital facility for expansion
• Strong customer base of 1,200+ clients including major tech companies
• Established partnership with Silicon Valley Bank expanding initial credit facility

Negative

• None.

Insights

Financial Analyst

The $50 million growth capital facility represents a significant financial milestone for Bugcrowd and reflects SVB's confidence in the cybersecurity sector. The deal structure as a credit facility, rather than equity financing, suggests a less dilutive approach to capital raising, which is particularly noteworthy in the current high-interest rate environment. With an impressive client roster including tech giants and government entities, Bugcrowd's platform demonstrates strong market validation. The funding's allocation toward AI platform development and M&A opportunities indicates a strategic growth trajectory in the rapidly evolving cybersecurity market. For First Citizens Bank (FCNCA), this deal strengthens its position in the tech lending space through its SVB division, though the exposure is relatively modest given FCNCA's $27.8 billion market cap.

Tech Expert

Bugcrowd's platform represents a sophisticated approach to cybersecurity, leveraging crowdsourced expertise combined with AI capabilities. The "skills-as-a-service" model is particularly valuable as organizations face increasingly complex cyber threats across diverse technology stacks. Their focus on emerging areas like API security, cloud workloads and AI systems positions them well in high-growth segments. The platform's evolution to address hybrid work environments and cryptocurrency infrastructure demonstrates strong market adaptability. The additional capital will likely accelerate their AI capabilities, potentially widening their competitive moat in vulnerability detection and management.

Financing provided by SVB's Enterprise Software Group

SAN FRANCISCO, Oct. 31, 2024 /PRNewswire/ -- Silicon Valley Bank (SVB), a division of First Citizens Bank, today announced it has provided a $50 million growth capital facility to Bugcrowd, a leading provider of crowdsourced cybersecurity solutions. Bugcrowd brings the collective ingenuity of organizations and hackers to mitigate vulnerabilities across all applications, systems, and infrastructure.

Provided by SVB's Enterprise Software Group, the new financing will further scale Bugcrowd's AI-powered platform globally, fund continued innovation into the Bugcrowd Platform, and leverage opportunities for strategic M&A, providing added value to clients, partners, and the hacker community.

"We're excited to have the continued support of Silicon Valley Bank with this $50M growth capital to accelerate innovation and scale our AI-powered platform," said Dave Gerry, CEO of Bugcrowd. "Our mission is to help organizations regain control of cyber risks by harnessing the collective ingenuity of the hacker community to outsmart adversaries. This capital provides the resources needed to strengthen our position as the leader of the crowdsourced security market."

For over a decade, Bugcrowd's unique "skills-as-a-service" approach has uncovered more high-impact vulnerabilities than traditional methods for more than 1,200 customers – including OpenAI, Google, T-Mobile, Carvana, the US  Department of Defense's Chief Digital and Artificial Intelligence Office (CDAO), ExpressVPN, Rapyd, New Relic, and OpenSea. With greater flexibility and access to a decade of vulnerability intelligence, the Bugcrowd Platform has evolved to address a changing attack surface influenced by adoption of mobile infrastructure, hybrid work, APIs, crypto, cloud workloads, and AI.

"With its innovative platform, Bugcrowd helps companies quickly and cost effectively discover critical vulnerabilities and proactively avoid being blindsided by cyberattacks," said John Benetti, Managing Director with SVB's Enterprise Software Group. "SVB is excited to continue our long-standing relationship with Bugcrowd, expanding our initial credit facility, and providing creative financial solutions to help them grow and scale their business."

About Silicon Valley Bank 
Silicon Valley Bank (SVB), a division of First Citizens Bank, is the bank of some of the world's most innovative companies and investors. SVB provides commercial banking to companies in the technology, life science and healthcare, private equity and venture capital industries. SVB operates in centers of innovation throughout the United States, serving the unique needs of its dynamic clients with deep sector expertise, insights and connections. SVB's parent company, First Citizens BancShares, Inc. (NASDAQ: FCNCA ), is a top 20 U.S. financial institution with more than $200 billion in assets. First Citizens Bank, Member FDIC. Learn more at svb.com

About Bugcrowd
We are Bugcrowd. Since 2012, we've been empowering organizations to take back control and stay ahead of threat actors by uniting the collective ingenuity and expertise of our customers and trusted alliance of elite hackers, with our patented data and AI-powered Security Knowledge Platform™. Our network of hackers brings diverse expertise to uncover hidden weaknesses, adapting swiftly to evolving threats, even against zero-day exploits. With unmatched scalability and adaptability, our data and AI-driven CrowdMatch™ technology in our platform finds the perfect talent for your unique fight. We are creating a new era of modern crowdsourced security that outpaces threat actors.

"Bugcrowd", "CrowdMatch", and "Security Knowledge Platform" are trademarks of Bugcrowd Inc. and its subsidiaries. All other trademarks, trade names, service marks, and logos referenced herein belong to their respective companies.

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SOURCE Silicon Valley Bank

FAQ

How much funding did Bugcrowd receive from Silicon Valley Bank in October 2024?

Bugcrowd received a $50 million growth capital facility from Silicon Valley Bank in October 2024.

What will Bugcrowd use the $50 million funding for?

The funding will be used to scale Bugcrowd's AI-powered platform globally, fund continued platform innovation, and pursue strategic M&A opportunities.

Who are some of Bugcrowd's major customers?

Bugcrowd's major customers include OpenAI, Google, T-Mobile, Carvana, the US Department of Defense's CDAO, ExpressVPN, Rapyd, New Relic, and OpenSea.