In just a few weeks, Group-IB will be celebrating its twentieth birthday. It’s a momentous occasion for the controversy-marred threat intelligence company, which helps organizations and governments investigate cyberattacks and online fraud. And Group-IB is planning to celebrate in style.
In an exclusive interview, Group-IB co-founder and CEO Dmitry Volkov tells TechCrunch that the company is using this “key juncture” to scale up and become a global cybersecurity powerhouse; not only is Group-IB celebrating the two-decade milestone by raising its first round of funding in seven years — it’s also planning to make its mark in the United States.
A rocky few years
Group-IB may have big plans coming up, but the company hasn’t had much to celebrate in recent years.
Back in September 2021, Group-IB’s co-founder and former CEO Ilya Sachkov was arrested by Russia’s Federal Security Service, and since convicted of treason by a Moscow court and sentenced to 14 years in prison. Investigators have said Sachkov was suspected of passing classified information to a foreign country, but no other details about the case have been revealed.
Sachkov’s arrest came after the 37-year-old cybersecurity expert spearheaded a move of Group-IB’s headquarters from Russia to Singapore after the U.S. government accused Moscow of meddling in the 2016 U.S. presidential election. Sachkov, who had been critical of the Russian government in the past, said at the time that moving to Singapore was part of the company’s efforts to grow its business and remain independent.
Months after Sachkov’s arrest, Group-IB — now headed by Volkov — further distanced itself from Russia by announcing it was leaving the country entirely. Group-IB, once seen as a shining star in Russia’s home-grown tech industry, completed its exit from Russia in April.
Volkov says that while Group-IB never kept secret that it was founded in Russia, it was clear the company’s ties to the country were harming its relationship with international clients — particularly following Russia’s invasion of Ukraine in February 2022.
Volkov sold his stake in Group-IB’s Russia-based business to the company’s local management, and the standalone Russian business now operates under the brand F.A.C.C.T. Group-IB’s branding and trademarks will cease to be in operation in Russia by the end of 2023.
Group-IB is a provider of proprietary cybersecurity solutions that helps organizations prevent cyberattacks, breaches and online fraud. The company counts over 500 enterprise customers, including delivery giant DHL and Bulgarian banking giant DSK Bank, and tells TechCrunch that it makes almost 40% of its income from the APAC region.
The company also says it runs the largest computer forensics laboratory in Eastern Europe, where its investigators identify suspects and collect and analyze evidence on the cybercrime scene. The company, which partners with law enforcement agencies including Interpol and Europol, says it has so far carried out 1,300 successful investigations.
When it first announced its exit from the Russian market, Group-IB said it was focused on expanding its presence in the Asia-Pacific and Middle Eastern markets, where it intends to open new digital crime resistance centers, or DCRCs, to protect its clients against targeted cyberattacks.
The company is now looking to create a global network of independent DCRCs, each equipped with the expertise to assess the local specificities and threat landscape of the region on which they are based. Volkov tells TechCrunch that Group-IB plans to enter the Latin American market in 2024, before expanding to the United States in 2026.
Group-IB is an outlier in the cybersecurity industry. While it’s not the only technology company to have exited Russia in recent years, it is one of a few to remain self-sufficient. The company raised a modest $1 million in 2016 and has since relied on organic revenue to grow its business by 50% year-on-year, Volkov tells TechCrunch.
To expand globally, the company is looking to raise for the first time in seven years. “We want to speed up our business and technology development, and it’s probably a good moment for us to raise now,” Volkov said. He added that the company was “already in conversation” with some potential strategic partners, though he wouldn’t be pushed on who.
This funding will fuel Group-IB’s expansion into the Americas and its ambitions to build DCRCs in every region to become a “decentralized company.”
“If you look at other cybersecurity companies, they are always very centralized,” Volkov said. “We want to make every single point of presence of Group-IB as independent as possible.”
Group-IB’s expansion plans come as other cybersecurity vendors are laying off staff. The company plans to use this time to recruit technical experts in various regions, who would be responsible for digital forensics, incident and emergency response and cyber forensics. (Volkov added that all potential candidates would undergo a polygraph. “Everyone — no matter what kind of role — must do a lie detector.”) Once the company starts to bring in revenue from that region, Group-IB will add layers, such as threat intelligence, and then “replicate” the same set-up in another region.
Volkov says the company has already started to hire in Latin America.