Blu Ventures-backed BreachBits has announced an investment from Lloyd’s, the world’s leading insurance and reinsurance marketplace, through its central fund after the Annapolis, Md.-based startup was part of a co-development project in Lloyd’s Lab cohort 13 last year. It was the London-based Lloyd’s third strategic innovation investment from among over 150 alumni of the Lloyd’s Lab.
U.S. military and intelligence veterans John Lundgren and J. Foster Davis co-founded BreachBits in 2018, with a pledge to deliver world-class cyber risk ratings, insights and advanced predictive intelligence. Lundgren was briefly a security researcher at Microsoft. In February 2023, Washington, D.C.-based BluVentures and BlueWing Ventures were part of a $3.2 million seed round for BreachBIts.
“We’re honored by Lloyd’s investment and proud to help facilitate Lloyd’s mission of sharing risk to create a braver world,” said Davis, the company’s chief operating officer. “Our team is committed to addressing real-world challenges in cyber insurance and risk management – especially in complex situations and where false-positives cannot be tolerated.”
At the Lloyd’s Lab accelerator program, BreachBits showed that its Cyber Questionnaire Validator product could help reduce underwriting time and improve risk selection. Additionally, its Cyber Pre-Claim Intervention product demonstrated a potential to reduce claims frequency and severity, the company said.
“BreachBits is revolutionising cyber risk assessment by providing insurers with key visibility into their clients’ security posture. Their time in the Lloyd’s Lab helped refine their approach from concept to market-ready solution, demonstrating exceptional results during pilot testing,” said Rosie Denée, head of Innovation, Commercial Education and Engagement at Lloyd’s.
BreachBits says its products are powered by BreachRisk a.i., a backend technology that has performed over 50,000 hacker assessments. The technology can detect, verify, and test over 95% of actual attacker pathways identified in the Verizon 2024 Data Breach Investigations Report (DBIR). The company also claims to have conducted over 4 million offensive security tests and provided intel of over 87,000 viable attack paths to customers in eight countries.
Lloyd’s backing comes as the cyber insurance market is growing rapidly, with premiums increasing from over $15 billion to potentially more than $55 billion in the near future, BreachBits said.
Early Backer
Blu Ventures, founded in 2010, has invested nearly $100 million in nearly 100 startups, focusing on SaaS and technology ventures. Its most recent fund of $25 million was raised in 2021. Blu’s recent portfolio investments include ThreatMate, Tamnoon, Procurement Sciences AI, GreyMarket Labs and ModelOp.
J.S. Gamble, one of the firm’s founders, serves as its managing partner. He previously worked at consulting firms McKinsey and Price Waterhouse. He also is an adjunct professor of entrepreneurship at the McDonough School of Business at Georgetown University.
