Sublime, an AI-powered email security startup, attracts venture capital investment.

• Attackers can use generative AI to automate the process of creating emails that can help them breach corporate systems.
• This year, Abnormal Security, a company that employs generative AI to detect and prevent email threats, achieved a valuation of $5 billion.
• Sublime Security has received $60 million in investment from investors, with the goal of utilizing AI to safeguard email accounts.

Securing email accounts for employees is a business opportunity for companies worldwide.

In 2012, Proofpoint went public and many enterprises adopted its secure email gateway software as a precautionary measure. However, in 2021, private equity firm Thoma Bravo bought Proofpoint, and in 2022, another provider, Mimecast, went private.

The rise of generative artificial intelligence has given hackers more ammunition and provided new tools for security companies to defend clients against attacks.

A mature market is now seeing a surge in popularity among new companies.

In 2022, investors valued Material Security at $1.1 billion in a funding round. In August, Abnormal Security, an AI-native company, announced it was worth $5.1 billion after a funding round involving and Wellington Management. And on Thursday, Sublime Security, co-founded by a U.S. Defense Department cybersecurity veteran, announced it had raised a $60 million funding round.

Kamdjou, who is also Sublime's CEO, had spent his former career demonstrating to companies how he could breach their networks and evade being hindered by email security solutions. Afterward, he opted to develop a solution.

He stated that he decided to construct something that would prevent him from being an attacker.

Brex, a business credit card issuer, initially used Material for inboxes but switched to Sublime after testing it out. According to Mark Hillick, the startup's chief information security officer, Sublime did not allow as many problem emails as Material did.

"Hackers only need one click to start their attack, and false negatives can be dangerous, as he explained."

Gartner's distinguished analyst Peter Firstbrook reports that Abnormal Security is significantly larger than Material and Sublime, with over $200 million in annualized revenue. The company is rapidly gaining market share.

Proofpoint is often used as an add-on to Mimecast or Abnormal Security, and for years, businesses have relied on it to filter messages before sending them to Microsoft-based inboxes. Recently, Proofpoint's revenue growth rate has increased to the teens, down from the thirties in 2018.

Abnormal was briefly considered by Brex but ultimately rejected, according to Hillick.

"I don't believe in black box as a philosophy," he stated. "It limits transparency, so I can't comprehend how Brex is being targeted. I can't discern the strategies or tactics being employed. However, with Sublime, I can achieve that."

Sublime offers better coverage of new threats, according to Hillick's experience. Abnormal's website claims that its software can detect unique attacks with no traditional indicators of compromise.

Despite paying for higher tiers of service, large email providers such as Google and Microsoft still experience attacks.

""We're seeing a lot of success because we're catching everything they don't," Kamdjou stated."

No representatives from Abnormal, Material, Microsoft, Mimecast, or Proofpoint responded to requests for comment.

Email security consultants in Alabama suggest that incumbents like Mimecast and Proofpoint are facing a challenge not in losing customers, but in missing out on new business from young companies that prefer next-generation tools such as Abnormal. However, some companies have switched from Mimecast and Proofpoint to Sublime, Kamdjou stated.

Proofpoint CEO Sumit Dhawan stated in October that the company was 12 to 18 months away from going public again. He mentioned that the company was aware of the challenge and had acquired AI startup Tessian last year. Despite seeing interesting potential acquisition targets, Dhawan noted that prices remained high.

Unlike many startups with billion-dollar valuations, Sublime does not engage in flashy marketing or make a lot of cold calls.

Kamdjou stated that the startup contacted Donald Trump's 2024 presidential campaign but did not make any progress. In August, the campaign announced that a foreign adversary had obtained documents after breaching its email system.

Kamdjou stated, "Fortunately, most people have learned about us through word of mouth."

By uploading emails to EML Analyzer, a free service that uses AI, they can assess Sublime's capabilities and detect if messages are likely to be benign, suspicious, or malicious. The tool can identify common phrases used in business-email compromise attempts.

Sublime's increased capital won't alter the sales-light approach.

Co-founder Ian Thiel stated, "Our mindset is that we will continue to invest heavily in R&D."

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