Atera Raises $77M to Empower SMBs with Enterprise-Grade Network Management

The Growing Need for IT Management Solutions for SMBs

For a considerable period, large enterprises have had a wide selection of software options to assist IT departments in managing employee devices, regardless of location. This has proven particularly beneficial in the last year and a half, as many organizations transitioned to remote work models. However, small and medium-sized businesses (SMBs) have often been overlooked in the development of modern IT management solutions designed to meet their specific requirements.

Atera Secures $77 Million in Funding

Indications suggest this is beginning to shift. Atera, a startup focused on creating affordable and predictive IT management solutions for organizations with fewer than 1,000 employees, has recently announced a $77 million funding round. This investment signifies both market demand and Atera’s success in addressing an underserved segment. The funding round has resulted in a company valuation of $500 million.

Extensive Customer Base and Endpoint Management

Based in Tel Aviv, Atera has already acquired approximately 7,000 customers. These customers utilize the platform to manage millions of endpoints – encompassing computers and other connected devices – across 90 countries. The system delivers real-time diagnostics, analyzing data generated by these devices to proactively identify potential issues related to hardware, software, networking, and security.

Expanding Product Functionality with AI

Atera intends to utilize the new funding to expand its customer base and enhance its product offerings. A key focus will be on augmenting the artificial intelligence (AI) capabilities currently in use, for which Atera holds patents. This will enable more sophisticated predictive analytics, a feature commonly found in solutions for larger enterprises but often absent in SMB-focused software.

Democratizing Enterprise-Level Capabilities

“We are essentially making capabilities that are available to enterprises accessible to SMBs, which represent the other half of the economy,” stated Gil Pekelman, Atera’s CEO, during an interview.

Funding History and Growth Strategy

The funding round was led by General Atlantic and represents only the second time Atera has sought external investment. The first round, a $25 million investment from K1 Investment Management, occurred earlier this year and is also participating in this latest funding. Prior to 2021, Atera achieved profitability in 2017 but deliberately moved away from profitability in 2019 to reinvest cash reserves into growth. The company was initially bootstrapped.

Remote Monitoring and Management Approach

As described by Pekelman and co-founder Oshri Moyal (CTO), Atera’s remote monitoring and management (RMM) approach begins with software clients installed on endpoints. These clients connect to a network, allowing IT managers to monitor network activity as if all devices were located in a single office. The system continuously monitors and collects approximately 40,000 data points per second.

Focus on Device Behavior and Diagnostics

It’s important to note that these data points do not track user activity or content, but rather focus on device behavior. Atera’s diagnostics cover three primary areas: hardware performance, network performance, and software performance and security. This allows the system to predict potential hardware failures, network connectivity issues, or suspicious activity requiring a security response. The platform integrates with third-party security software, such as Bitdefender and Acronis, and provides updated security patches.

Self-Service Model and Cost-Effectiveness

The system is designed for self-service implementation. Customers purchase Atera’s products online without the involvement of a sales team. A significant portion of the company’s marketing efforts are currently focused on Facebook and Google, an area where continued investment is planned. This approach contributes to the affordability of Atera’s services, costing $89 per month per IT technician, regardless of the number of managed endpoints.

Targeting the Neglected SMB Market

“Our target demographic consists of organizations with up to 1,000 employees – a segment that has historically been underserved,” Pekelman explained. “The smaller businesses we focus on often lack access to tools like ours.” With a monthly cost of $89 per technician, a company with 500 employees and four technicians would pay only $356 per month for network management, a relatively small expense compared to traditional IT services.

Investor Confidence and Future Growth

The success of this model is a key factor driving investor interest.

General Atlantic’s Perspective

“Atera has created a compelling all-in-one platform that delivers substantial value to its customers, and we are excited to support the company during this phase of growth,” said Alex Crisses, MD, global head of New Investment Sourcing and co-head of Emerging Growth at General Atlantic, in a statement. “We are pleased to invest in a category-defining Israeli company, expanding General Atlantic’s presence in the country’s innovative technology sector and marking our fifth investment in the region. We look forward to collaborating with Gil, Oshri, and the Atera team to help them achieve their vision.”