API attacks are a growing concern for businesses, and Traceable, a San Francisco-based security company co-founded by Jyoti Bansal, aims to address this issue. Bansal, known for his previous success with app performance management startup AppDynamics, recognized the lack of recognition surrounding API security and the increasing attack surface in APIs.
According to cybersecurity firm Check Point, API attacks affected nearly one quarter of organizations every week in the first month of 2024, marking a 20% increase from the previous year. These attacks come in various forms, including overwhelming APIs with traffic, bypassing authentication methods, and exposing sensitive data transferred via APIs.
The rise in API attacks can be attributed to the growing usage of APIs by businesses, particularly due to the generative AI boom. A recent study revealed that the number of APIs used by companies increased by over 200% between July 2022 and July 2023. Moreover, Gartner predicts that by 2026, more than 80% of enterprises will have utilized generative AI APIs or deployed generative AI-enabled apps.
To protect against API attacks, Traceable applies AI technology to analyze usage data and identify any abnormal activity. The software developed by Traceable can discover and catalog both existing and new APIs in real time, including undocumented and deprecated APIs. By learning normal API behavior, Traceable’s platform can effectively detect deviations and potential threats.
While the API security solutions market is becoming increasingly crowded with vendors vying for customers, Bansal claims that Traceable is holding its own. The company currently analyzes around 500 billion API calls per month for approximately 50 customers and expects its revenue to double this year. While most of Traceable’s clients are in the enterprise sector, the company is also exploring partnerships with governments.
In a strategic move to further develop its platform and expand its team, Traceable recently raised $30 million in a funding round led by Citi Ventures, IVP, Geodesic Capital, Sorenson Capital, and Unusual Ventures. This brings Traceable’s total raised funds to $110 million and values the company at $500 million post-money. The investment will be used to enhance product development, scale up the platform, and grow the customer engineering teams. Additionally, Traceable plans to focus on building partnerships to strengthen its market presence.
Traceable currently has approximately 180 employees, and with the new investment, Bansal anticipates the headcount to reach 230 by the end of 2024. Despite already having a substantial cash runway and securing a line of credit, Traceable received significant interest from investors due to its strategic alignment with Citi Ventures and favorable investment terms. This smaller investment will allow Traceable to accelerate its product and go-to-market initiatives before considering a more substantial fundraising effort.
In conclusion, Traceable’s AI-powered platform is poised to address the increasing threat of API attacks by analyzing usage data and detecting abnormal activity. With a rapidly growing market and a strong customer base, Traceable aims to become a long-term sustainable company in the API security solutions space.
