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Cato captures $200M in largest funding round

SASE provider Cato Networks has raked in $200 million in its largest funding round thus far, bringing total financing to $532 million. This funding round was led by Lightspeed Venture Partners, in addition to existing investors Greylock, Aspect Ventures/Acrew Capital, Coatue, Singtel Innov8 and Cato CEO and Co-Founder Shlomo Kramer.

In a prior funding round in November 2020, Cato brought in $130 million. Cato pulled in another $77 million in April 2020.

Cato says the most recent funding will go toward product development and expansion of its global private network. Currently, Cato has over 65 PoPs worldwide – this year the company added PoPs in locations including Casablanca; Morocco; and Munich, Germany.

CMO Yishay Yovel says Cato's PoPs connect "Internet and cloud traffic, and also Wide Area Network traffic – the East/West traffic going between branches and the data center – which is our legacy, the traditional way of doing things. Cato covers both the past – we'll support your voice, remote desktops, data center and legacy applications – and the future – AWS, Azure, Office and 365 – all within a single platform."

The company has grown 50% this year to over 400 employees, and the pandemic has had a positive impact on the company's growth as enterprises invest more in cloud-based networking and security services to support a distributed workforce, says Yovel. Customers can select a client-based or clientless option to deploy Cato's SASE services, he adds.

"We have to become cloud-first as it relates to networking and security," says Yovel. "We have to put a cloud-based platform that converges networking and security into a single service and allow any edge – which could be a branch, user, cloud or application – to consume those networking and security services from the cloud."

Yovel says Cato's ability to "deliver the same capabilities anywhere" is evidence that it's "cloud-first [approach] was ideally built to accommodate this transition from the office to the home and back to the office."

Cato is also broadening its customer base. Historically a competitor to telcos, Cato has begun partnering directly with service providers seeking a SASE service that they can provide to end users as a managed service. In April, Cato announced a collaboration with its largest SP customer, Japan-based KDDI. Last week, KDDI America said it would start providing Cato SASE services to customers in North, Central and South America, which is the latest step in KDDI's efforts to provide the SASE platform to customers globally.

— Kelsey Kusterer Ziser, Senior Editor, Light Reading

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