Dashlane Appoints JD Sherman as New CEO | Dashlane News

In today’s digital world, our dependence on online services has reached unprecedented levels, leading to increased attention on online protection measures. Recent news from a leading password security company highlights the evolving business landscape for providers of these essential tools.

Emmanuel Schalit, the co-founder of the well-known password manager Dashlane, is transitioning from his role as CEO. He will be succeeded by JD Sherman, formerly the COO of HubSpot, as Dashlane focuses on expanding its reach within the business sector.

“This shift is centered on outlining our next phase of scaling, with a greater emphasis on B2B monetization following our success in B2C,” Sherman stated in an interview, commending his predecessor’s achievements in the consumer market while acknowledging that “B2B was not his primary strength.”

Sherman’s professional background, conversely, has been consistently focused on B2B. Prior to his eight years at HubSpot, he served as the CFO of Akamai (a CDN also prioritizing security, though in a distinct manner), and previously held a position at IBM.

Sherman is located in Boston and intends to commute to Dashlane’s headquarters in New York (“eventually,” as remote work is currently the standard, with Sherman himself hired through a virtual process).

This leadership change occurs during a significant period for the company. Dashlane currently boasts 15 million users, an increase from over 10 million in 2019. That same year, Dashlane secured two substantial funding rounds within six weeks of each other: a $30 million round (which included some debt) and a $110 million Series D, valuing the company at just over $500 million. Investors include Sequoia, Bessemer, FirstMark, Rho Ventures, and TransUnion.

Sherman refrained from discussing the current valuation or the company’s immediate financial plans, but indicated a positive outlook and hinted at a potential IPO in the future.

“The Series D round was favorable for a subscription-based business,” he explained. “Currently, our cash flow is strong, and we have the necessary funding for growth, so there’s no immediate need to raise additional capital. When we do, we’ll evaluate whether to pursue an IPO round” – the final funding stage before an IPO – “or not. My priority is to expand the business.”

[Speculation] It is likely that the company’s valuation has increased, considering the growth in user numbers, the expansion of its enterprise business, and the heightened market awareness of online security in the past year. (It’s also worth noting that LogMeIn, owner of competitor LastPass, was acquired by PE firms for approximately $4.3 billion in a deal finalized last year.)

Dashlane initially focused on providing password management solutions for individual consumers, who still comprise the majority of its user base. However, the Series D funding was intended to accelerate expansion into the business market and increase overall brand visibility.

The move into business users was a logical progression for several reasons. First, business subscriptions offer a more consistent and predictable revenue stream compared to the freemium consumer model. Second, satisfied consumer users may seek the same service for their professional online activities. This remains Sherman’s core strategy.

“The goal is to develop two distinct sides to the business,” he said, drawing a parallel to the consumer-to-business flywheel effect: “The more individuals who use it, the more businesses will adopt it and become comfortable with utilizing a password manager.”

This strategy is currently benefiting from the substantial surge in online activity over the past year.

The past year has seen a significant shift of activities – including shopping, entertainment, social interaction, and work – to the online realm, driven by the emergence and ongoing impact of the highly contagious and dangerous COVID-19 virus.

While some of these changes have been surprisingly positive, many believe that even after the pandemic subsides, a significant portion of these activities will continue to be conducted online.

However, this increased online engagement has also created a substantial opportunity for malicious hacking, security breaches, and the misuse of online identities. This situation is directly relevant to Dashlane’s mission.

Password protection is a critical component of online safety, with weak, compromised, and reused passwords being major contributors to security breaches for both individuals and organizations (estimates suggest that 80-90% of all security breaches can be traced back to password-related issues).

Furthermore, the recent increase in security breaches has heightened public concern about privacy and security, leading to greater demand for tools like those offered by Dashlane and other companies focused on enhancing online security.

Ongoing advancements in technology will continue to improve the detection and prevention of malicious activity, and cloud-based security solutions will also be refined. However, password managers are likely to remain a vital part of the security landscape.

Password managers are not without their limitations – there have been isolated instances of breaches, and security researchers at the University of York identified potential vulnerabilities in May 2020 – but they offer a relatively straightforward way for individuals to proactively protect their identities by improving their password management practices. (Notably, Dashlane has maintained a breach-free record throughout its 10+ years of operation.)

The password management market includes platform-based solutions and direct competitors like 1Password and LastPass. Collaborative efforts, such as the “OpenYolo” project initiated by Google and Dashlane, have faced challenges due to the complexity of integration with existing managers.

Despite the fragmented, competitive, and occasionally vulnerable nature of the market, Dashlane still possesses significant growth potential.

“The business is robust and expanding,” Sherman concluded. “The circumstances surrounding COVID and the rise of remote work have elevated the importance of password management and security in general. While the environment is more challenging, there is a positive trend supporting our industry.”