Israeli car cybersecurity co GuardKnox raises $21m
11 June 2019 - globes
Automotive venture capital fund Fraser McCombs Capital led the round.
Israeli car cybersecurity company GuardKnox today announced that it had raised $21 million in a financing round led by automotive venture capital fund Fraser McCombs Capital. Ramla-based GuardKnox has now raised a total of $24 million.
Another investor in the financing round was Faurecia Ventures, the investment arm of French company Faurecia, a tier-1 auto technology provider, which made a strategic investment. The investment was the first in Israel by Faurecia, which will open an innovation center in Midtown Towers in Tel Aviv in the coming months.
There were numerous other investors in the round, each of which invested a relatively small amount. These included Chinese government-owned SAIC Capital (Shanghai Automotive), Chinese fund Glory Ventures, US fund Allied Investments, Volkswagen importer Plug and Play, Israeli company Cyphertech (controlled by Shay Livnat Holdings), and Kardan Ltd.
GuardKnox was founded in January 2016 by three Israel air force veterans: CEO Moshe Shlisel, CTO Dionis Teshler, and VP R&D Idan Nadav. The company has 30 employees at its offices in Ramla, and will use the proceeds from the round to open offices in Germany and the US over the coming year and to hire dozens of additional employees. GuardKnox is not revealing its customers, but its founders say that they include some of Europe's largest auto and parts manufacturers.
"The car is undergoing a process similar to what happened to the telephone in the past few decades. We have reached a point at which the important question will not be how the car will take me from place to place, but how it can serve me," Shlisel told "Globes." "The care will be connected from everywhere in order to provide the best user experience. As such, it will be exposed to hazards and break-ins by hackers. The car will therefore require both cyber protection and protection for computers, with a very high level of performance that will enable it to operate well and safely. We provide both of these capabilities, as well as services based on them, such as downloading apps and installing them safely in the car," he added.
GuardKnox's technology is designed to deal with cyber threats of remote takeover of the car by separating the cars systems from each other. If there is a break-in into one system, the rest will still be protected. The company's technology, based on the founder's technological experience in the air force, relies on the principles and methodology used in the F-16 warplane.
In addition, the company has a cooperation agreement with Palo Alto Networks, which provides GuardKnox with encoding and security for the communications systems of the vehicles that it protects. The encoding is designed to enable the car to communicate only with reliable sources for software updates, cloud computing calculations, and sending and receiving regular data.
Faurecia, the world's sixth-rated tier-1 manufacturer and supplier of auto parts, has a market cap of €4.6 billion on the Euronext Paris stock exchange. It has 300 factories spread around the globe, 35 research and development centers, and 122,000 employees in 37 countries. Its 2018 sales turnover was €17.5 billion.
GuardKnox is Faurecia's first investment in Israel, but the French company has had scouting activity in Israel since 2016. Faurecia employed Uri Pachter as the Israeli representative of its investment and cooperative ventures arm. This activity generated 12 current proof of concept projects with Israeli startups.
Faurecia followed up on this by founding an Israeli subsidiary name Faurecia Security Technologies in September 2018 and appointing Pachter as its CEO. The company rents offices in Midtown Towers in Tel Aviv, which it is scheduled to occupy this September. By 2020, the company plans to have 25 employees in Israel developing cyber security technologies for inclusion in Faurecia's products.
"We realized that we have to step up and improve our information security capabilities; otherwise, we won't succeed in selling our products to the auto manufacturers. 18 months after I began working with them in Israel, the CEO visited Israel and told me that a decision had been taken to found a technological platform in Israel that would focus on information security, cyber, and sensor capabilities and solutions," Pachter says. The company has two technological platforms besides the one in Israel: the company operates an innovation center for digital services and artificial intelligence in Silicon Valley and a life sciences center in Toronto.
"The first product in which we have a critical need for cyber defense and information security, in which we'll cooperate with GuardKnox, is called the driver's future cabin," Pachter says. This cabin will have many sensors monitoring the identity of the driver and his or her physiological state, and will operate various systems for this purpose. "If the driver is tired, the system designed to inject blood will operate. If he or she is tense, a system designed to calm him or her will operate automatically, and so forth," he adds. Another Israeli startup cooperating with Faurecia in designed the future driver's cabin is Vayyar, which develops 3D sensors capable of seeing through solid materials.