Bugcrowd, a frontrunner in the field of crowdsourced cybersecurity, today announced the acquisition of $102 million in fresh funding, underscoring the swift expansion and widespread acceptance of using ethical hackers to identify vulnerabilities.

Spearheaded by General Catalyst, the latest investment round brings the company’s valuation to over $1 billion, as reported by insiders familiar with the transaction. This significant infusion of capital is set to boost Bugcrowd’s global expansion efforts, drive innovation in its AI-driven platform, and facilitate strategic acquisitions.

“Bugcrowd attracts customers looking for alternatives to traditional crowdsourced security providers due to dissatisfaction with slow response times, inconsistent and perplexing pricing structures, limited engagement with the community, and inadequate client support options,” Bugcrowd’s CEO, Dave Gerry, told VentureBeat in an exclusive discussion.

The market for crowdsourced security is expected to climb from $90 million in 2019 to over $135 million by 2024, according to industry predictions, as companies aim to supplement their in-house security measures with external expertise. Capitalizing on this trend, Bugcrowd has welcomed over 200 new clients in the last year alone.

Bugcrowd’s offerings, such as Penetration Testing-as-a-Service (PTaaS) and bug bounty initiatives, allow for ongoing scrutiny of client applications, networks, and systems through a crowdsourced approach. This model’s primary benefit is its capacity to harness varied expert knowledge on demand, uncovering flaws and vulnerabilities that conventional testing might miss.

The company’s unique CrowdMatch technology, powered by AI, ensures efficient pairing of researchers with clients based on specific needs, significantly boosting productivity. Additionally, Bugcrowd has integrated smoothly with leading developer platforms like GitHub, facilitating continuous crowdsourced testing throughout the software development lifecycle (SDLC).

“Looking ahead to 2024, we aim to significantly outperform our achievements in 2023 and offer customers the leading AI-powered crowdsourced security platform for real-time insights,” Gerry shared with VentureBeat.

With this new capital and its ongoing success, Bugcrowd is well-positioned to challenge the penetration testing and vulnerability management sectors, traditionally dominated by established consulting firms like Cloudflare and Crowdstrike. By merging crowd-sourced expertise with AI/ML technologies, Bugcrowd aims to expand its testing reach and offer continual monitoring over the entire attack landscape.

In this over $1 billion valuation round, General Catalyst, along with previous investors Rally Ventures and Costanoa Ventures, contributed to the new $102 million funding. These resources will be used to further refine the platform’s capabilities and pursue rapid global growth.