VPN usage has risen sharply in recent years, with increasing privacy and data security challenges, and sometimes entirely new motivations, such as people wanting to access content that would otherwise be blocked in their regions. , which generates a 30% estimate of users using a VPN sometime in 2022. Nord Security the startup behind one of the largest paid VPN providers, NordVPN secured significant funding that catapulted it to a "unicorn" valuation to develop its consumer and enterprise business lines to capitalize on that growth.
The company raised $100 million in a funding round led by Novator, the European company that has backed Deliveroo, Stripe, Tier, among others — with Burda Principal Investments and General Catalyst, as well as the likes of Supercell's Ilkka Paananen, Wolt's Miki Kuusi and Automattic's Matt Mullenweg. This round values the startup at $1.600 billion.
NordVPN and the other security and identity management products Nord sells, including NordPass password manager, NordLocker for cloud sync and storage, NordLayer for enterprise network access, and development tools for creating custom VPNs, have grown collectively 15 million users over the years.
Along with its organic expansion, it has also been expanding via M&A: in February Nord announced a merger with Surfshark, another security company with Lithuanian roots (and more specifically, in the same business and incubator where he was also born Nord Security, Tesonet).
So why enter a financing round? Tom Okman, co-CEO and co-founder with Eimantas Sabaliauskas, said he made the funding decision to keep up with the times, while continuing on course for his mission, which could best be summed up as embracing the ideals of an Internet open, but do it in a way that protects users from those who might exploit it with more malicious intent.
"We saw the changing landscape in digital privacy ... and that the open Internet was not working as expected," he said. “Our mission is to build a radically different Internet by protecting consumer and business accounts and network information from cyber threats around the world.”
People often use VPNs to get around more restrictive internet policies, or simply to keep their browsing more private, but the VPN industry hasn't had an entirely smooth path to meeting those goals. Critics have denounced how VPNs, specifically those that advertise themselves as “free”, but also some that charge for their services, do not handle user data responsibly and could, in fact, pose security risks to your customers.
Some of those criticisms have also affected NordVPN. In the last three years, his name has been mentioned in connection with russia ordering VPN to block certain sites, a breach of one of its data centers, and that some of its browser extensions don't act as you seem. When asked about these events and what the impact has been on NordVPNOkman says the company has been changing over the years to address the different issues and make it better.
“We have learned our lesson and have come a long way since 2019,” he said. The data center breach found that no data was compromised, he said, but prompted the company to reconfigure its security and change the way it handles data in general (systems are now diskless, he said). Internal security teams have been increased and the company now undergoes regular audits, in association with the US firm Versprite.
The situation with Russia led the company to take all of its business out of the country, and it said that NordVPN it now has very few users located in that country.
The main objective is to continue building business and consumer services. "We prohibit any illegal activity and define it in our terms of service," he added. "That's the big difference, and a distinction between paid and free VPN services."
“Modern internet security requires an entirely new approach to address the secular growth in risks stemming from expanding data regulations and worsening cyber threats,” said Birgir Már Ragnarsson, managing partner at Novator Ventures, in a statement. release. “Tom and his team are well positioned to deliver and usher in the new era of Internet security with a powerful and enhanced suite of security and privacy tools designed to protect information, accounts and networks. It is rare to find a company that can already demonstrate such an excellent track record, brand credibility, and unwavering focus on serving customers, which is why we are delighted to partner with Nord Security to support the team as they execute their global vision.”
