SYN Ventures Q4 '23 Update

SYN Ventures Investors, CISOs, Advisors, and Friends,

What a year 2023 has been. ?In a challenging macro environment, SYN is proud to continue supporting our portfolio companies and is pleased to have realized three exits this year – our third year in existence. ?As our portfolio companies scale and hit various milestones, we are excited to share about several portfolio company financing events that will propel their journeys further.?? In particular, Q4 had a flurry of activity and SYN is hopeful that 2024 will build on the momentum of this quarter and beyond.

The Q4 ‘23 highlights include:

• Two M&A exits - One in Flagship Fund I and one in Flagship Fund II, resulting in 3 exits throughout 2023
• Three follow-on investments - Two in Flagship Fund I and one in Flagship Fund II
• Completed our first investment in the new Seed Fund
• Held our semi-annual CISO Board of Advisors meeting and our annual CEO Summit
• We reviewed over 100 security companies in Q4, resulting in over 460 new company reviews throughout 2023

Halcyon has continued to see explosive growth, attracting preemptive interest from a number of investors in less than six months since SYN led the Series A.? After fielding multiple offers, the company closed a $40 million financing from Bain Capital.? Concurrent with the new capital, Halcyon has continued to build the already impressive management team by attracting Jeff Williams to join as CRO.? We believe Jeff’s experience scaling sales will be a critical asset to the team’s maturity.

Since our seed investment in April, Cranium has closed several Fortune 500 customers for its AI Security & Governance platform.? The platform continues to expand, helping organizations gain confidence in the AI-enabled solutions they are both creating and using, and Cranium has recently launched its AI-Red Teaming and AI Card products.? The company’s software bridges the gap between data science, compliance, and cybersecurity teams by providing a single source of truth for AI security risks.? In October, Cranium closed a $15 million financing led by Telstra Ventures.? The new capital enables the company to continue hiring best-in-class security, AI, and go-to-market talent.?

In December, Phosphorus closed on a $27m financing round, providing the company with years of runway.? Phosphorus has continued to disrupt the xIoT security space, closing major deals across key industries, including healthcare, manufacturing, and energy & utilities, and more.? The company has launched major partnerships with Check Point and Doosan to continue expanding its reach.

In Q3, we shared that Upfort (fka Paladin Cyber) launched its rebrand and in Q4, the company announced its $8m Series A led by SYN Ventures in January 2023.? Upfort simplifies cyber risk management with turnkey security proven to mitigate risk and comprehensive cyber insurance from leading insurers in one holistic platform.? The company’s innovative Upfort Shield demonstrated an 80% likelihood of claims, and the Series A will support Upfort’s mission to accelerate global cyber resilience efforts and transform the economics of cyber underwriting risk.? Additionally, the company announced a strategic partnership with Arch Insurance to transform its cyber insurance programs for SMBs, associations and risk pools.?

In November, Refine Intelligence launched out of stealth.? The company introduces a new paradigm in anti-money laundering and fraud, helping financial institutions recognize customers’ life stories and identify legitimate activities, so they can quickly clear away false alarms.? The platform applies context aware AI and advanced analytics to enhance the operational efficiency of complying with AML regulations and reduces costs associated with AML investigations.? The company’s first customer was Valley Bank, who after implementing Refine Intelligence’s solution, cut its AML inquiry process from days to minutes. Refine Intelligence is led by Uri Rivner, who the SYN team has known since his RSA days when he was Head of New Technologies, Identity Protection, after the acquisition of Cyota.

In Q4, SYN exited two investments.? In November, Revelstoke was acquired by Arctic Wolf.? Additionally, Talon Cyber Security announced its acquisition by Palo Alto Networks, 16 months after our investment.? We had a great deal of confidence in both of these companies and teams, and we are sure that they will thrive within Arctic Wolf and Palo Alto respectively.

In early October, SYN Ventures announced the first close of our first Series Seed dedicated fund.? This Fund represents the largest cyber, seed-dedicated fund domiciled in the United States.? The goal is to partner with entrepreneurs at the earliest stage of their journey.? Along with this fund, Dan Burns’ role with SYN Ventures expanded as he took on the role of Investment Committee Chair for the Seed Fund.? Marcio Lempert, a SYN Venture Partner based in Israel, has expanded into a full-time role with SYN.? Marcio is well-positioned to deepen SYN’s ability to partner with leading entrepreneurs, startups and VCs in Israel. ?Over the last few months since announcing the Seed Fund’s first close, SYN has met with over 60 Series Seed fundraising opportunities, representing over 40% of total seed deals SYN has met with from firm inception to date, reinforcing our thesis that the US has demand for a cybersecurity-focused seed-dedicated fund.

Subsequently, SYN closed its first investment out of the Seed Fund in Auguria.? Founded and led by Keith Palumbo and Chris Coulter, whom we have known since our investment in Cylance. ?Auguria is a security data management, prioritization, and analysis platform that leverages proprietary data ingestion and analysis techniques to reduce high volume data flows into actionable data, additionally enabling customers to reduce onerous SIEM and log management spend.? The company has started engaging with design partners, and if you are interested in potentially exploring a design partnership, please let us know and we will be happy to make an introduction.

We are also excited to announce our newest addition to the team, Tim McKnight.? Tim joins us as an Operating Partner and is going to be an incredible addition for SYN Ventures, having recently retired from SAP as its Global Chief Security Officer and a member of its ELT.? Prior to SAP, Tim served as the CISO at Thompson Reuters and General Electric and has served in IT Security leadership roles at Fidelity Investments, Northrop Grumman, BAE Systems and Cisco during his career.? Tim continues to deepen our bench with his blend of security and business leadership.

Along similar lines, we are thrilled to announce the promotion of Dylan Posner to Senior Associate.? Dylan has been with SYN since March 2022 and continues to assist us in deal diligence and portfolio management.? We are excited to have Dylan continue his career journey at SYN.

As 2023 came to an end, we are grateful to our LPs, portfolio companies, CISO communities, and ecosystem of partners.? As we look forward into 2024, we hope we continue to hit and exceed the high marks SYN has set for ourselves and our portfolio companies.

Best,

Jay, Patrick, Art, Ryan, Bob, Dan, Marcio, Tim, Dylan, John, Pradeep, Adrian and Robert