Andreessen-Horowitz injects $30M into encryption startup CipherCloud

If you’re only protecting your enterprise’s perimeter, you’re not doing enough. Cloud encryption company CipherCloud, which just announced a $30 million first round of funding from Andreessen-Horowitz today, knows that it’s the data inside that cyber-criminals really want.

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The best way to protect the cloud is still very much up in the air. Protecting the perimeter, or only accounting for the point of entry into your system, doesn’t help you when the bad guys get in anyway and start messing with your data. Just putting up firewalls doesn’t seem to work anymore. Now we’re sending our data out of the locked-up gates into the cloud, so CipherCloud encrypts that data before it ever reaches your cloud applications.

The data is encrypted in such a way that your cloud applications can still make use of the data, but in theory, it’s much safer since you hold the keys that decrypt it. You can also change the level of encryption you have based on your company’s needs. It works on applications such as Salesforce, Microsoft Office 365, Amazon Web Services, Google apps, and more.

It also uses tokens to protect the data in instances where encryption isn’t an excepted form of security. Some industries have different regulations on security measures, and CipherCloud caters to a range from banking institutions to healthcare. The tokens allow businesses to store their data on premises and then send a token — which is a form of the data, but not the exact file you want to protect — out to the cloud application.

CipherCloud faces competition from Vaultive and other such companies. Vaultive, which specializes in Microsoft Office 365 and Microsoft Exchange 2010, also encrypts an enterprise’s data before it reaches the cloud. It received $10 million from New Science Ventures, Harmony Partners, and .406 Ventures in February.

This is the first round of funding for CipherCloud, which was founded in 2010. It has 40 enterprise clients, and within that, 1.2 million users.

Cloud diagram via CipherCloud