Upwind, a San Francisco startup selling runtime security for cloud infrastructure, has closed a 400 million dollar Series C led by Bessemer Venture Partners at a 3.8 billion dollar valuation, with Canapi Ventures joining existing backers including Greylock Partners, Cyberstarts, Craft Ventures, Salesforce Ventures and TCV. The company says total funding now exceeds 800 million dollars. The round comes nine months after a 250 million dollar raise at a 1.5 billion dollar valuation.
The financing nearly did not happen in this form. TechCrunch reported, citing a person familiar with the company, that Datadog attempted to acquire Upwind during the raise but offered no premium above the 3.8 billion dollar valuation venture investors had set, and Upwind chose to stay independent. The Information had earlier reported a Datadog offer of nearly 4 billion dollars. Neither company has confirmed the discussions.
The valuation implies a steep multiple. Upwind is adding 20 million to 30 million dollars of annualised recurring revenue per quarter and is projected to end the year at roughly 90 million dollars, according to a person familiar with its financials cited by TechCrunch, which puts the price above 40 times forecast recurring revenue, though below the roughly 80 times reported for Cyera earlier this year.
Upwind was founded by Amiram Shachar, who sold cloud spend company Spot.io to NetApp for 450 million dollars, and sells security that acts on live workloads rather than static scans, now including agents that investigate activity, test whether exposures can be exploited and identify remediation. The strategic logic of a Datadog approach is plain, observability and security data converge in production systems, and so is the risk in refusing it: few cybersecurity companies reach the public markets, and a later sale remains the likeliest exit even at this valuation.