Skyflow, a data protection The startup announced on Friday that it has expanded the number of markets in which it offers data residency support for companies that need to keep certain information within defined boundaries. In today’s market, it is probably not possible to keep EU customer data in, for example, South America and vice versa. Therefore, companies must be careful that certain information stays at home in the market from which it originated.
Skyflow started out as a tool to help businesses securely store personally identifiable information (PII). Its API helps companies “solve all the difficult privacy, encryption and data issues of storing personal data and other forms of potentially radioactive data for their customers,” we wrote when we last reported on the company.
The startup, which most recently completed a $45 million Series B in late 2021, can now meet data residency requirements in Japan, India, Indonesia and Bahrain. The work, Skyflow CEO Anshu Sharma told TechCrunch+, will enable software companies to offer their services to more markets faster, while complying with local regulatory requirements regarding data location and secure storage of personal user information.
Sharma argued that his company’s newly expanded regional data storage capabilities would provide opportunities to help other companies avoid the complexities that come with building their own data storage and security frameworks only to adopt them in new markets.
Skyflow’s work to support more regions hasn’t come cheap. Sharma said the work came with a “high fixed cost” that Skyflow could afford because it “raised a lot of money” and allowed the company to “cover the infrastructure and operational costs” for its customers. (Aside, that’s the purpose of venture capital: to build beyond sales in hopes of capturing outsize market share.)
When you consider that every tech company — whether startup or enterprise — wants to grow as much as possible in the current slow market, you can understand why Skyflow expects a return on its spend. As software companies continue to push to enter new markets to sell their services, they must self-manage a set of data regulations and rules. Or they can work with Skyflow or one of its competitors – EverVault, protegrityamong other things – to help meet local requirements.
To date, Skyflow has garnered remarkable international acceptance. Sharma told TechCrunch+ that Skyflow does more than 40% of its current business with non-US customers. The CEO was quick to point out that some well-known software companies were generating a low double-digit percentage of their sales in international markets when they went public by using the S-1 filings during our call. It will be interesting to see if greater regional support will take this figure above 50% over time; We’ll be in touch with the startup again in a few quarters.
Where does generative AI come into play here?
Skyflow initially focused on offering its services to the fintech and healthcare industries. However, it is recently built a version When we had Sharma on the phone to talk about data residency, we also asked a few questions about market demand for LLM-related software services.
First, we wanted to know if the startup developed the tool based on known demand or ahead of anticipated need. Per Sharma, his startup started receiving calls from customers a few months ago about generative AI and how these companies need to keep not only PII but also internally sensitive data off LLMs. He said the demand stems from both bottom-up adoption of generative AI tools and senior-level curiosity. Put another way, both corporate drones and corporate demigods want to use generative AI, but they don’t want to get in trouble with the kind of data leaks we’ve already seen in the market.