Cyber security specialist raises £3.6m in round led by Archangels

AN EDINBURGH-BASED cyber security software firm whose clients include Rockstar Games, Craneware and Zenith Bank plans to triple its headcount after raising £3.6 million in venture capital funding.

The Series A funding for ZoneFox has been led by Archangels in the biggest round to be led by the Scottish business angel investment syndicate. Scottish Investment Bank and TripCap also participated in the round. The company did not disclose the size of the stakes taken by the investors, some of which had previously backed the business.

ZoneFox, which provides security systems to combat cyber threats to business in the financial, pharmaceutical and gaming sectors, will use the funding to expand its headcount to 30 by the end of the year, move into new headquarters in Edinburgh and open its first office in London.

The company, which had previously raised £2.5m in seed funding since 2010, also plans to continue investing in product development and innovation. Its most recent product, a machine-based learning solution called ZoneFox Augmented Intelligence, was launched after a six-year development period.

Chief executive Jamie Graves, a PhD graduate from Napier University, said: “We have established a strong reputation and generated a lot of interest from some global organisations, which have in turn become clients.

“Having the funding and support of Archangels, the Scottish Investment Bank and TriCap will allow us to continue to grow and develop ground-breaking solutions that will protect businesses.”

The funding follows a year of strong growth at Zonefox. It saw revenue rise by 400 per cent in the last 12 months, although it declined to put a numerical value on how much it turns over.

The company has brought former BT and O2 director Steve Davies on board as chairman.

Niki McKenzie, investment director at Archangel, said: “Archangels’ investors were keen to lead this round of follow-on funding in an area that is currently under-served. Customers using ZoneFox report that the product is helping them to shape more robust, tailored and effective IT policies, alerting them to security threats from within their own walls.”