VPN usage has been steadily growing, with the COVID-19 pandemic giving it an extra boost as people were forced to work from their homes.
NordVPN is already one of the biggest players in the market, but the company apparently has bigger plans. To that end, its parent — Nord Security — has raised $100 million in a round of funding that valued the company at a whopping $1.6 billion.
European VC Novator Partners led the round, with participation from Burda Principal Investments and General Catalyst, as well as individuals such as Ilkka Paananen of Supercell, Miki Kuusi of Wolt and Matt Mullenweg of Automattic.
Ever since it was founded in 2021, Nord Security didn’t raise any external funds and has rather decided to bootstrap the business. In the meantime, it launched a few other-than-VPN products, including the NordPass password manager, NordLocker for cloud sync and storage, and NordLayer for network access for businesses and developer tools to build custom VPNs. These services combined are being used by 15 million users.
According to Tom Okman, the co-CEO and co-founder with Eimantas Sabaliauskas, they made the decision to finally raise external funds so they could “keep up with the pace of the times,” while also continuing to stay on course with its mission.
“We saw the changing landscape in digital privacy… and that the open internet was not working as intended,” he said. “Our mission is to build a radically different internet by securing consumer and enterprise accounts, and network information, against cyber threats around the world.”
Beyond protecting one’s privacy, VPNs are also used for accessing content and services that would otherwise be unavailable to the users. For instance, many non-Americans use VPNs to connect to US-centric streaming services, while those living in high-censorship countries rely on it to get real information that is beyond the country’s firewall.
Nord Security said it will use the new funds to continue building out enterprise and consumer services as a paid offering. As part of that generic statement, we may see further consolidation in the ever-competitive VPN market. In that sense, in February – Nord merged with Surfshark, which is another strong VPN player; and since other players are teaming-up as well, we’ll likely see more of these kinds of deals announced in due course.
In the meantime, here’s what Birgir Már Ragnarsson, managing partner at Novator Ventures, had to say about the deal: “Modern internet security requires a completely new approach to address the secular growth of risks from expanding data regulations and ever-worsening cyberthreats. Tom and his team are well-positioned to deliver and usher in the new era of internet security with a powerful and best-in-class suite of privacy and security tools, designed to protect information, accounts and networks. It’s rare to find a company that can already demonstrate such an excellent track record, brand credibility and unwavering focus on serving customers, so we are delighted to partner with Nord Security to support the team as they execute their vision at scale.” With this round, Ragnarsson is joining Nord’s board.
Pros
Cons
- 5,000+ servers in the network
- Easy to use - install it and forget it
- One license is good for up to 6 devices
- Strict zero-logs policy
- 30-day money-back guarantee
- Chrome extension is just a proxy