The latest financial information from Nord Security, the parent company of NordVPN and the suite of tools that comes with it has shown that the VPN market around the world continues to be buoyant and attract investor interest.
Nord Security has just announced that it has raised US$100 million in new funding from US private equity firms in what is a huge vote of confidence in both the Nord Security business and the VPN market in general.
Nord Security’s new investment
The new US$100 million investment round has been led by Warburg Pincus, a significant US Private Equity group which manages assets worth in excess of US$83 billion.
The funding is intended to allow Nord Security to further expand its product range. It is envisaged that this will be achieved through two means: research and development in-house and the acquisition of other companies.
Speaking to the Financial Times, Tom Okman, Co-Chief Executive of Nord Security said, “General awareness of security and privacy products really helped to boost our growth and numbers. We’ll be able to fuel that growth even further.”
As part of the deal, Warburg Pincus will get a seat on the Nord Security Board of Directors.
It is not the first time Warburg Pincus has backed a tech company, with previous investments including the likes of CrowdStrike in the past.
But, given that a lot of tech company valuations have dropped over the past year, the decision to invest in Nord Security at this moment is a huge endorsement of the business and the direction in which it is heading.
Why invest in Nord Security now?
This is not an example of a Private Equity fund pouring money into a black hole in the hope of profits further down the line, as is the case with a lot of tech companies.
Nord Security is one of the few major tech companies on the market that operates at a profit. While full financial details of the new deal are not available, it is also believed that Warburg Pictus was also attracted by the fact that the majority of revenue the company generates is from consumers and small businesses.
They see scope to grow this income stream, and Okman said as much to the Financial Times. He claimed, “there are lots of strategic opportunities open for us, for both organic and inorganic growth.”
The move will see Nord Security continue to move in an upward trajectory. Last year, they also managed to raise US$100 million in funding from investors, which included Novator, the investor behind the likes of Deliveroo and Cazoo.
That investment led to Nord Security purchasing Surfshark and AtlasVPN, and with the new investment funds burning a hole in their bank account, we can expect to see more acquisitions of this nature from Nord Security in the not too distant future.
For NordVPN subscribers, there will be no obvious change, although over time, they may see more services and features being added to the NordVPN offering as a result of Nord Security’s expansions.
Most NordVPN subscribers won’t have too much to complain about with that though, and this latest investment round for Nord Security looks likely to be a win-win situation for all stakeholders.