The open source password manager provider, Bitwarden, has secured a $100 million minority growth investment to support its user community, scale its password management solution, accelerate product expansion, and provide stronger online security for individuals and enterprise customers. The latest round of funding was led by the growth equity firm PSG, with existing investor Battery Ventures also participating.
There was a major increase in cyberattacks on businesses during the pandemic when many employees were forced to work from home. The rapid change in working practices created many security challenges for companies, which had to rapidly adapt to support a largely remote workforce. Many companies were forced to allow workers to use their personal devices for work and have continued to support remote or hybrid working. The use of devices for personal and work has increased risk, and cybercriminals have taken advantage.
One of the biggest cybersecurity risks comes from poor cyber hygiene such as employees reusing passwords for multiple accounts. Employees need to create passwords for many accounts, business and personal, which often leads to the creation of weak passwords that are easy to remember or the use of the same password to secure multiple accounts.
The problem is easy to remember passwords are easy to guess or brute force, and if passwords are reused across multiple accounts, a breach at one company would allow access to be gained to all other accounts that use the same password. The simple solution is to set a unique, complex password for all accounts and to use a password manager to generate those secure passwords and store them securely so they do not need to be remembered.
Bitwarden’s password manager – which has paid and free versions – is a popular choice and is used by tens of thousands of businesses and millions of individuals worldwide. The solution has features such as automatic password generation, credential autofill, password strength scoring, secure credential and file sharing, flexible cloud and self-hosted deployment options for enterprises, and benefits from open source security – the source code is available for anyone to check and is actively reviewed to identify potential vulnerabilities.
“By taking a differentiated approach to password management — one that serves individuals and business, one that stands by open-source, one that makes a fully featured free version available to the world — I believe Bitwarden has leapt ahead in the market,” said Bitwarden CEO Michael Crandell. “The rapidly expanding Bitwarden customer base, including small and large companies alike, combined with a highly engaged community, in our view, continues to set Bitwarden apart from other solutions.”
The latest round of funding will be used to support its user community, scale the solution, and accelerate product expansion. “The timing of the investment is ideal, as we expand into opportunities in developer secrets, passwordless technologies, and authentication. Most importantly, we aim to continue to serve all Bitwarden users for the long haul,” said Crandell.
“Our investment in Bitwarden reflects our conviction that the password management market is poised for considerable growth as online account use grows and security concerns mount in the hybrid working environment,” said Tom Reardon, Managing Director, PSG. “In our view, Bitwarden distinguishes itself among the available alternatives by virtue of its open-source architecture, flexible deployment options, and zero-cost offering which millions of individuals have utilized. These unique attributes remain unchanged, and we look forward to helping the team bring this solution and the next generation of password management tools to a broader group of customers.”
Bitwarden’s board of directors will also be strengthened with Tom Reardon and Govind Anand, Principal at Providence Strategic Growth. PSG, both joining the board.