Summary: This content discusses a data privacy startup that has received funding to advance privacy technology for enterprises.
Threat Actor: N/A
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Key Point:
- A data privacy startup founded by a freshly minted Harvard graduate completed a $40 million Series B funding round led by StepStone Group.
Artificial Intelligence & Machine Learning
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Governance & Risk Management
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Next-Generation Technologies & Secure Development
StepStone Group Leads Series B Round for Enhanced Privacy Solutions for Businesses
A data privacy startup founded by a freshly minted Harvard graduate completed its Series B funding to help enterprises manage personal data and oversee AI systems.
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San Francisco-based Transcend said the $40 million investment will encode privacy controls directly into business systems and address the full personal data privacy life cycle from discovery and classification to responding to data deletion and access requests. The Series B round, led by new investor StepStone Group, brings Transcend’s total funding to nearly $90 million since being founded in August 2017.
Offerings from legacy data privacy players are operationally burdensome and fail to integrate privacy into technical systems, which Transcend co-founder and CEO Ben Brook said has created demand for systems that embed privacy controls directly into data-handling processes. The cash infusion will help Transcend capture market share and address the heightened demand for advanced privacy solutions (see: Forrester’s 2024 Predictions for Security, Risk and Privacy).
“The market is clear that there needs to be a replacement,” Brook told Information Security Media Group. “And that has really reached a fever pitch in the past year. We’ve just seen such an incredible influx in demand for a system which can actually take privacy and move it down to the technical layer in the business and solve privacy for the long term.”
Transcend employs 95 people – up 38% from just 69 employees a year ago, according to LinkedIn – and has been led since its inception by Brook, who graduated from Harvard with a bachelor’s degree in computer science just months before starting the company. The Series B investment comes nearly four years after Transcend completed a $25 million Series A funding round led by Index Ventures and Accel.
From Consumers to the Fortune 500
Since that time, Transcend said, it has expanded beyond “a virtual kill-switch for consumers to delete data” to a robust privacy and AI governance suite of 12 tools that helps enterprises automate privacy tasks and assess risks. The company eschews legacy privacy platforms and manual workflows in favor of automating operational workflows and aiding AI adoption through data mapping and governance.
“Transcend takes a radically different approach to solving modern data privacy problems by tackling it at the code level, which is one of the many reasons we’ve invested in the company,” StepStone Group Partner John Avirett said in a statement. “What’s also remarkable is how often they’re moving companies with complex data requirements off inefficient legacy platforms and point solutions.”
Brook said Transcend plans to extend its reach beyond its heritage in consumer technology to sectors such as telecommunications, financial services and consumer packaged goods – the company already counts major banks among its clientele – and address privacy in large corporations and tackle complex business systems and structures, which requires embedding technical controls into these systems.
“Since privacy challenges are rooted in the complexity of corporate data, that gets exponentially more complex as you go into much larger businesses,” Brook told Information Security Media Group. “And so with the larger private sector, we see complexity in many more legacy systems and much more internal confusion about who owns the system and whether there is an owner for the system.”
Companies in the Fortune 500 and Global 2000 – including LG Electronics, Plaid, Brex, Hims & Hers and Rippling – turn to Transcend for privacy and governance. The company said it streamlines and automates data governance practices required by the European Union’s AI Act, such as describing data management procedures and creating technical documentation for data collection, cleaning and provenance activity.
Keeping Up With Emerging Regulations
From a product standpoint, Brook said, Transcend will continually update its platform to comply with new privacy laws, such as the European Union’s AI Act and various state-level regulations in the U.S. Brook said the company must stay ahead of emerging regulations by updating its platform to address these changes and by ensuring that privacy is managed at the technical layer within organizations.
Transcend said its platform reduces risk, enables business innovation grounded in compliant data usage, drives operational efficiencies and helps organizations build trust with customers through responsible data practices. The company said the rampant adoption of AI across industries has added new layers of complexity to how companies use and protect data, necessitating the implementation of safeguards.
From an AI standpoint, Brook said, Transcend is developing tools to manage AI systems’ compliance with internal policies, ensuring they do not misuse personal data. Transcend also will use the $40 million to invest in integrations with additional databases and SaaS tools to ensure comprehensive privacy management across diverse data environments, according to Brook.
“The next frontier that we are seeing right now is an extraordinary rise around AI governance,” Brook said. “Increasingly, we’re serving customers in understanding what their models are, understanding how they’re being deployed, the relative risk levels, and then actually setting technical controls around those AI systems to ensure they’re operating in accordance with our customers’ own internal policy.”
As far as metrics are concerned, Brook plans to closely track Transcend’s win rate against rival OneTrust – which he said is currently nearly 90% when a direct bakeoff takes place – along with increasing market share and maintaining near-perfect logo retention rates. Brook said CISOs are increasingly turning to Transcend to address modern privacy challenges that legal teams cannot solve on their own.
“We’re increasingly seeing CISOs as our buyer because privacy challenges stem from the complexity of their business’s data, and lawyers cannot solve those challenges alone,” Brook said.
Source: https://www.govinfosecurity.com/transcend-gets-40m-to-advance-privacy-tech-for-enterprises-a-25345
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