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- New York-based data privacy startup Ethyca has raised $13.5 million from IA Ventures and PayPal cofounder Max Levchin’s SciFi VC.
- Founded in 2018, Ethyca provides products to help businesses better assess their data privacy needs to comply with regulations around the use of customer data and compliance.
- The round takes the company’s total funding to $20 million which will go towards improving headcount and adding to customer numbers.
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Data privacy is big business.
In the past decade a spate of regulation has been brought in across the world to safeguard data held by companies and institutions about their customers.
Europe’s General Data Protection Regulation (GDPR) sprang up in 2016 to protect citizens’ data, causing immediate regulatory headaches for businesses worldwide. Next month, California’s CCPA regulation comes into effect. Additionally, new privacy legislation is in the works in Brazil, India, South Korea, and Thailand.
With data privacy now top of the agenda for businesses and institutions, Ethyca, a New York-based startup founded in 2018, plans to provide tools to help companies manage data issues. The data privacy startup promises to help businesses better assess their data privacy needs and to comply with regulation.
The startup has just raised $13.5 million from IA Ventures and PayPal cofounder Max Levchin’s SciFi VC, following a $6.5 million seed round last July.
Other notable investors in the round include: CAA cofounder Michael Ovitz, Warby Parker cofounders Neil Blumenthal and Dave Gilboa, Harry’s cofounder Jeff Raider, Allbird’s cofounder Joey Zwillinger, Behance cofounder Scott Belsky, former chief data scientist of the US Office of Science and Technology Policy DJ Patil, Lachy Groom, as well as Abstract Ventures.
“Data privacy isn’t the most sexy or glamourous subject, but it’s very important,” Ethyca cofounder and CEO Cillian Kieran told Business Insider in an interview. “Users are worried about the use of data in an increasingly digitized world as the proliferation of tech creates difficulties for the average user.”
Ethyca spent around a year prior to its seed round building out its product to ensure its tech was plausible and up to scratch. The company’s privacy platform and API are now used by companies to manage customer data concerns.
“Previously if you wanted to understand how data was used in your business you would need to hire consultants to come in and analyse databases, interview users and stakeholders to build a map of where data is used, and then enact processes to address that,” Kieran added. “It was such a manual and labour-intensive process.”
Dollars for data
Ethyca hadn’t been planning on raising so early in 2020 but received interest from investors in January that prompted the current round, and closed in late March.
“We did video calls with the West coast in February and March amid interest from investors,” Kieran added. “We didn’t need the amount of capital but had to take more from Series A investors. Now we have a very strong runway, can hire talent, and compete with larger companies.”
One impressed investor was Max Levchin, Paypal cofounder, who took a “long, hard look” at Ethyca’s tech before deciding to invest which Kieran said was “strong validation” for the company.
Ethyca wants to boost its headcount on the back of this fundraise. The company also invests into the culture of the engineering community to help give engineers better tools to make better software, Kieran said. That includes investments into Carnegie Mellon university’s MSIT in Privacy Engineering.