Tuesday, August 22, 2017

$30 Million Dollars Injected into Antivirus Start-Up Malwarebytes

July 18, 2014

Malwarebytes, San Jose, California, recently announced a $30 million investment by Highland Capital Partners. This is the first time the company has ever looked outside for capital – they have so far funded their phenomenal growth from their own profits.

Malwarebytes’ CEO Marcin Kleczynski says he will use the extra funds to employ more staff – software engineers and sales people. He stresses that Malwarebytes has always been and is still profitable. He declined to disclose profit or revenue, but stated that the company has 60 million subscribers on a quarterly basis.

Highland Capital Partners’ interest in Malwarebytes is a reflection of the global demand for computer security and antivirus products, which are increasingly vital to any business as cybercriminals devise more and more subtle ways to bypass security measures.

Highland Capital has a history in the cyber security market – they made a very lucrative investment in the Chinese Internet security business Qihoo 360. Qihoo 360 floated in 2011 and their market capitalization is now more than $20 billion.

Highland Capital had to court Malwarebytes – they first approached Mr. Kleczynski in February 2013. Their cold call at that time did not bear immediate fruit. Malwarebytes, founded in 2008, was able to sustain itself from its own healthy profits. It took many months of effort on the part of Highland Capital to persuade Mr. Kleczynski that the investment would make the company more profitable.

Mr. Kleczynski first became interested in malware when his parents’ computer became infected in 2004. He conducted a lot of research in online forums. It was a forum that led to his meeting, several years later, with Bruce Harrison, who became instrumental in setting up Malwarebytes. But Kleczynski didn’t meet Bruce Harrison face-to-face until sometime later – not until Malwarebytes had returned a cool $1 million in profit did he arrange a meeting.

Mr. Kleczynski grew the company while he was a student at the University of Illinois at Urbana-Champaign. He only recently moved to San Jose. He is confident that the company’s growth is assured with the new investors.

Malwarebytes offers a free antivirus product, in addition to their subscription security service. It has many customers, both in the private and business sectors.

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