Why did we invest in Blockfenders?
Blockfenders is an innovative company that use the zero trust architecture and blockchain to make data sharing a more secure process across the board.
They raised a $1.5 million pre-seed round which also featured participation from institutional funds like Blume Ventures, Together Fund, and Veda VC alongside renowned angel investors like Dr. Anand Deshpande, Nitish Mittersain, and Dinesh Agarwal.
- The Cybersecurity Pandemic
We live in a world that is fast moving towards complete digitisation. Allured by the efficiency, transparency, and velocity in action that digital repositories induce, more and more companies are looking to move to completely digital ecosystems. However, while digitisation is indeed in full swing across all major companies in the world, the safety of data repositories is a grave question that is yet to be addressed comprehensively.
The occurrence of data breaches has been increasing significantly over the past few years, with 2022 witnessing a total of 2.29 billion records being exposed globally in 2022. The victims of such breaches include large organisations like Microsoft, Twitter, and Uber who all have had to face the release of terabytes of sensitive data, and immense loss both monetarily and in terms of their reputations.
Data breaches bring about a disproportionately high damage to smaller companies’ longevity as well. As per a report from Verizon, 43% of data breaches involve small business victims. This is very critical because the average cost of a data breach in India is $2.32 million, which is massive for any small business to bear. This inordinate loss coupled with reputational collapse that accompanies it causes 60% of small businesses to collapse within half a year of a breach.
With such grave consequences, companies are looking towards more secure mechanisms for sharing critical information both inside the corporation and to external stakeholders. As distributed networks and open data ecosystems rise in prominence, this need has only become more pressing recently.
2) Utility of Zero Trust Security
Traditionally, the IT industry has utilised standard perimeter security mechanisms to safeguard the security of valuable resources like user data and intellectual property. These security strategies involved using firewalls and other network-based tools to inspect and validate users going into and out of the network. However, as open data ecosystems become more common and more companies embraced cloud-based data repositories, the need for rigid solutions was made apparent. This is where zero trust solutions come in play.
Unlike conventional solutions, the zero trust model assumes that a breach is constantly occurring and verifies each request as though it originates from an open network. Regardless of where the request originates or what resource it accesses, zero trust assesses it meticulously to block out any potential nefarious elements. Zero trust also organizes and strategizes a thorough approach to counter those threats. This constant vigil is what makes the zero trust infrastructure a viable solution when compared to the status quo.
(Amount in USD millions)
As per an IBM report, 41% of companies adopt a zero trust security architecture. The utility of this technology can be made evident by the fact that the other 59% of companies that don’t deploy the technology incur an average of USD 1 million in greater breach costs compared to those that do.
Therefore, for ensuring a better standard of data security and privacy, solutions based on the zero trust system must be made more accessible for businesses across the world.
3) A Technically Stellar Team
Blockfenders was started by Viraj Phanse and Niranjan Ingale in 2022 with the mission of rendering data breaches a relic of the past using the zero trust architecture and blockchain. While this is indeed an ambitious expedition, the capabilities that the team bring to the table inspire a great deal of confidence.
Viraj is a UCLA (M.S. in C.S.) and UC Berkley (M.B.A.) alumnus with a considerable degree of pertinent experience under his belt. He’s overseen product for some of the eminent companies like Amazon Web Services and Oracle. During our conversations, his deep expertise in product management and digital transformation shone through, along with a great knack for leadership.
Niranjan, a Pune University alumnus (B.E. and M.B.A.), is a serial founder. Prior to Blockfenders, he had successfully founded 2 other startups wherein his ability to come up with new business strategies and opportunities was a key contributor. Through his entrepreneurial experience, he is very comfortable building from scratch and inspiring exponential growth in his companies.
Therefore, due to their versatile and complementary proficiencies, Viraj and Niranjan form a founding team that covers all necessary bases perfectly.
4) An Innovative Product
Blockfenders provides a safer infrastructure for data sharing through the zero trust architecture. They use APIs which enables them to integrate easily with systems. Their unique architecture makes it easier and cost-effective to securely share verifiable, privacy preserving, context-aware and compliant data with anyone across and between any environments or organization. They also use distributed ledger technology to enhance security across the board.
Distributed ledger technology (DLT) allows for storage of all information in a secure and accurate manner using cryptography. It is a protocol that enables the secure functioning of a decentralized digital database i.e., eliminates the need for a central authority to keep a check against manipulation. It can only be accessed using “keys” and cryptographic signatures. Once the information is stored, it becomes an immutable database and is governed by the rules of the network. The technology’s enhanced security due to decentralisation sets Blockfenders apart from the competition.
Therefore, Blockfenders’ unique architecture helps maximize business value for their customers by minimizing data security, regulatory and compliance risks. Due to the versatility of their product, companies are able to reduce their overall costs by more than 80% with automation of data management, and simplifies data sharing.
Conclusion
While the world is moving towards more open digital ecosystems, the threat of data breaches is only increasing. 2022 witnessed a total of 2.29 billion records being breached. These are perilous for both large enterprises and smaller companies due to the financial loss and the reputational loss that accompanies them. Therefore, companies are looking for new ways of ensuring the sanctity of their data repositories.
To counter the threat of frequent data breaches, a lot of companies are turning towards zero trust architectures which assume that a breach is constantly occurring to ensure a constant vigil and more rigid parameters of data security. The capability of this infrastructure can be gauged by the fact that the companies that used it reduced their data breach losses by an average of $1 million. The zero trust architecture needs to be the core of any new solution meant to bolster data security.
The Blockfenders team inspire trust in their solution for this problem statement not just through their impeccable understanding of the space, but also due to the fact their areas of proficiencies complement each other’s perfectly. Through their operational experience, they’ve developed well-rounded skillsets that make them great entrepreneurs.
To enhance their product, Viraj and Niranjan use the distributed ledger technology. This technology is particularly effective due to the fact that it allows for decentralization. It eliminates the need for a central authority to keep a check against manipulation. It can only be accessed using “keys” and cryptographic signatures. The integration of DLT within their product sets Blockfenders apart from the competition.
Due to the aforementioned factors, Blockfenders have been able to create a distinguished position for themselves. We are proud of their growth journey, and wish them the best.
