20-50% of help desk calls are in reference to password resets. 80% of cybersecurity attacks are focused on passwords. 92% of businesses believe passwordless authentication is the future of the enterprise. HYPR makes a passwordless future a reality with its multi-factor authentication platform that provides industry-leading security without the hassle of remembering passwords. The company focuses on delivering a better user experience with the convenience of smartphones combined with the security of a smart card. The immense shift to work from home has only further accelerated the need for modern security solutions in a remote world and HYPR has been able to more than triple its ARR since its previous funding in the fall of 2019.
AlleyWatch caught up with Cofounder and CEO George Avetisov to learn more about the impact the pandemic has on the state of security, the company’s impressive traction, growth plans, and latest round of funding, which brings the total funding raised to $72M.
Who were your investors and how much did you raise?
This is a $35M Series C Investment led by Advent International. Advent joins HYPR’s existing investors including RRE Ventures, .406 Ventures, BoldStart, Top Tier Capital, MESH, Alumni Ventures Group, Allen & Co, Samsung NEXT, and Mastercard.
Tell us about the product or service that HYPR offers.
HYPR is the leader in Passwordless Multi-factor Authentication.
The HYPR Cloud Platform makes it easy to eliminate passwords and deliver lightning-fast login experiences that users love.
With HYPR, businesses are finally able to stop phishing, reduce fraud, and enable unrivaled security for employees and customers across the globe.
What inspired the start of HYPR?
The cofounders and I started HYPR in my bedroom in New York City. Since I was very young, I had been working in eCommerce, 
a space where you encounter a lot of fraud as a merchant.
I experienced everything from stolen user accounts and credit cards to synthetic identities and bad wire transfers. And as a victim of the credential reuse problem, I often wondered why technology hadn’t solved some of the primary issues with digital identity. Specifically – passwords. Today the team at HYPR is laser-focused on solving that problem and I could not imagine a better group of individuals to achieve this.
How is HYPR different?
The combination of Speed & Security
HYPR is up to 300% faster than legacy MFA products. HYPR’s Patented mobile-initiated authentication is unique and not available from any other MFA vendor. As the first and only mobile-initiated login experience, HYPR secures workstations and defends against attacks while users log in up to 300% faster than password-based MFA.
100% Passwordless
HYPR emphasizes “True Passwordless MFA” and is an enterprise-grade platform powered by Public-Key Cryptography and Open Standards.
Lower costs & Efficiency
HYPR transforms the smartphone into a smartcard, enabling unrivaled security for customers and employees across the enterprise. Reducing the costs of specialized hardware such as Yubikey, Windows Hello devices, and RSA Tokens. HYPR combines the convenience of a smartphone with the security of a FIDO Token. By turning the user’s phone into a FIDO token, HYPR is able to provide the same level of security while allowing businesses to utilize the smartphones their users already have.
What market does HYPR target and how big is it?
HYPR is targeting the $30 billion multi-factor authentication market. We believe our Total Addressable Market (TAM) will grow quite larger over the next 5 years as enterprises rapidly expand their Identity and Access Management (IAM) budgets and prioritize next-gen authentication.
What’s your business model?
HYPR provides a SaaS-based subscription model that caters to small businesses as well as large global enterprises.
How has COVID-19 impacted the business??
COVID-19 has accelerated the urgency and adoption of passwordless MFA. As if the password problem wasn’t bad enough already, the pandemic made it a larger problem for organizations of all sizes. For example, the number of remote login attacks jumped more than 700% during the pandemic.
This past year we’ve seen businesses dealing with credential reuse, account takeover fraud, phishing, and MFA bypass attacks at a scale never seen before.
We believe businesses view Passwordless MFA as a compelling and effective way of solving this problem. By combining the security of strong encryption with the convenience of a smartphone, they are able to introduce users to a much faster, more secure user experience. The result is a path to reducing phishing, fraud, and friction at scale – and that’s something everyone can get behind.
We believe businesses view Passwordless MFA as a compelling and effective way of solving this problem. By combining the security of strong encryption with the convenience of a smartphone, they are able to introduce users to a much faster, more secure user experience. The result is a path to reducing phishing, fraud, and friction at scale – and that’s something everyone can get behind.
What was the funding process like?
This was a very comfortable funding round for us. We were introduced to Advent fairly late in our fundraising process and found the team to be very compelling. They made us an offer we couldn’t refuse.
What are the biggest challenges that you faced while raising capital?
Like many others, this was our first time raising millions of dollars over Zoom. I would say that the biggest challenge is getting personally comfortable with a business partner you’ve never met face to face. On the other hand, it becomes a natural filter for finding partners you really vibe with and feel good about. I got a great feeling from Ashwin Krishnan and the whole team at Advent.
What factors about your business led your investors to write the check?
I would say that it’s a combination of HYPR’s ability to differentiate in a crowded space while remaining laser-focused on execution. That sounds like a bunch of VC buzzwords but I believe demonstrating focus can go a long way in conveying the long-term value and vision for a company – and that’s important to investors.
What are the milestones you plan to achieve in the next six months?
HYPR will use the funding to accelerate our go-to-market strategy and grow our global support organization in an effort to eliminate passwords for businesses worldwide. We’re aggressively expanding our enterprise integrations and self-service capabilities to make it even easier for businesses to go passwordless.
That means ramping up quickly with plans to grow to more than 130 employees by the end of the year.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
I would encourage startups in NYC to look outside the “VC bubble” and reach out to sources of capital they might not have considered pre-pandemic. Hedge funds are a great example. We met a number of them during this process and were blown away by how eager they are to break into growth-stage VC rounds. My advice? Talk to some of the “Hedge Funds VCs”… you might be surprised.
I would encourage startups in NYC to look outside the “VC bubble” and reach out to sources of capital they might not have considered pre-pandemic. Hedge funds are a great example. We met a number of them during this process and were blown away by how eager they are to break into growth-stage VC rounds. My advice? Talk to some of the “Hedge Funds VCs”… you might be surprised.
Where do you see the company going now over the near term?
We doubled our customer base during the pandemic, so a key area of focus is our support organization and growth engine. Over the next year HYPR will double its headcount investing heavily in our GTM and global support teams.
What’s your favorite outdoor dining restaurant in NYC
Bareburger in Forest Hills.
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Source: https://www.alleywatch.com/2021/04/hypr-passwordless-multi-factor-authentication-george-avetisov/
