Cato Networks Stuns SASE and SD-WAN Worlds By Doubling Valuation in One Year to $2.5 Billion

Fans of Cato Networks were in for a treat today when the company announced it had raised an additional $200 million, bringing its total financing to over half a billion dollars.

This leader in Secure Access Services Edge (SASE) and SD-WAN continued to forge ahead by investing in and promoting its global SASE platform, following the direction set by Gartner (News - Alert) when it introduced SASE as a trend in 2019. Little did naysayers realize, at the time, that SASE would take the SD-WAN world by storm, including driving Cato's rapid growth.

The round was led by Lightspeed Venture Partners with the participation of existing investors Greylock, Aspect (News - Alert) Ventures / Acrew Capital, Coatue, Singtel Innov8, and Shlomo Kramer. The new funds will fuel Cato's sales, technology, and business growth to further support the security and global networking needs of large enterprises.  

"Cato is at the forefront of SASE transformation," said Shlomo Kramer, CEO, and co-founder of Cato Networks. "Large enterprises are deploying Cato as their global network to reap the operational and business benefits of Cato's proven and mature SASE platform. Cato is rapidly expanding its service capabilities, global footprint, and sales and marketing teams while preserving our unique DNA of agility, simplicity, and ease of doing business that is so valued by customers and partners."

Over the last five years, SD-WAN dramatically advanced how organizations connected branch locations into central data centers, reducing cost and weaning enterprises off MPLS, making it possible to steer traffic according to business priorities.

SASE uses SD-WAN to connect geographically dispersed branches and other sites to enterprise data and computing resources. But SASE goes further in two ways. First, it connects mobile users through a client or clientless configurations and cloud resources, such as SAAS applications and resources in AWS or Azure. Second,  SASE ups the ante by its ability to seamlessly deliver full security to every edge on the network.

A distributed network architecture is critical to support the increasing use of cloud platforms, SaaS (News - Alert) applications and to support the explosion of remote and mobile workers. Even as we slowly recover to a post-Covid-19 era, there will always be a significant need to support people who continue to work from home, either permanently or occasionally.

The Cato SASE Cloud, built on the proprietary Cato SPACE technology, is the "only proven and mature SASE platform that can holistically, quickly, and easily, deliver on the secure and optimized application access challenge," the company said in a statement. "Only Cato can connect and secure all enterprise edges — sites, mobile users, and cloud resources — with one global cloud-native platform. This is the essence of a true SASE platform."

The Cato SASE Cloud is distributed across more than 65 PoPs worldwide. With such extensive geographic coverage and a proven technology stack, Cato has been able to address the needs of very large global enterprises. Today, dozens of such enterprises spend more than $250,000 in annual recurring revenue (ARR) with Cato, an increase of 163% year-over-year, and several global enterprises spend over $1M in ARR.

"Cato has seen an amazing adoption of its SASE platform by increasingly larger enterprises," said Yoni Cheifetz, a partner at Lightspeed Venture Partners. "What started as disruptive innovation and a novel idea is now a fast-growing business that is at the heart of enterprises' mission-critical operations. We are delighted to partner with Cato and support its mission of delivering optimal and secure access to all users, locations, and applications – everywhere."

"Cato pioneered SASE, creating the category before it existed," said Scott Raynovich, Founder and Chief Analyst at Futuriom, a research, and analysis community focused on next-generation cloud technologies. "They saw the need early on for enterprises to deliver global, cloud-delivered networking and security. It's a vision that is now paying off with tremendous growth."

Cato's approach to SASE takes all the capabilities of secure SD-WAN by converging SD-WAN, a global private backbone, a full network security stack, and support for cloud resources and mobile devices. It is an architectural transformation of enterprise networking and security.

SASE uses a full enterprise-grade network security stack natively built into the SASE Cloud to inspect all WAN and Internet traffic. Security layers?include application-aware next-generation firewall-as-a-Service (FWaaS), secure web gateway with URL filtering (SWG), standard and next-generation anti-malware (NGAV), and managed IPS-as-a-Service?(IPS).

SASE easily supports mobile and remote users by giving them simplified and secure remote access by installing a client agent on the user's device or by providing clientless access to specific applications via a secure browser. All security and network optimization policies that applied to users in the office instantly apply to them as remote users.

"It wasn't long ago that networking and enterprise security were different disciplines," Cato's CEO Shlomo said in a blog. "Silos, if you will. But today, with users working everywhere, security and networking must always go together. The only way to protect users everywhere at scale without compromising performance is the cloud. Converging security and networking together into a genuine cloud service with a single-pass, cloud-native architecture is the only way to deliver high-performance security and networking everywhere. That's the power of SASE."