CapitalG-backed Security startup Verkada hits $5.8 billion valuation

Security technology startup Verkada reached a valuation of $5.8 billion after a new financing round led by CapitalG. alphabet The venture capital arm was announced Wednesday.

“I think Google saw this opportunity with us in the application of AI and everything we’re doing to apply AI to the physical security industry,” CEO Filip Kaliszan told CNBC’s Deirdre Bosa.

The company said in a statement that the investment led by CapitalG will be used to support artificial intelligence capabilities and provide liquidity.

The financing totaled $100 million and the company’s valuation increased by $1.3 billion from its Series E funding in February, a person familiar with the terms of the round told CNBC. The person requested anonymity to discuss details of the financing.

CapitalG also recently contributed to a $435 million fundraising for cybersecurity startup Armis in November.

The new funding comes as Verkada surpasses $1 billion in annual bookings across 30,000 customers worldwide.

The company develops physical security products including cameras, alarms and sensors that are connected under a single cloud-based software platform.

Kaliszan said his company serves a wide range of businesses, including retailers, government properties, schools and transportation.

For example, TeraWatt Infrastructure, which provides charging sites for electric vehicles like Google’s Waymo, uses Verkada technology to protect EV facilities.

In September, the company rolled out more than 60 new AI features and platform updates, including tools like the “AI-Powered Unified Timeline.”

The tool can automatically synthesize videos and images from various cameras into a single visual timeline, rather than requiring security teams to review multiple videos during an investigation.

“The genius of Filip and the Verkada team is that they use AI as a Rosetta Stone to unlock information from cameras to help companies become safer and more efficient,” CapitalG general partner Derek Zanutto told Bosa.

Zanutto said Verkada can capture more than 20 million images per hour, providing important data such as foot traffic, occupancy rates, security breaches and other trends.

He added that physical security is a dormant $60 billion market dominated by legacy hardware such as “cameras that just record, not cameras that think,” a gap that Verkada hopes to fill.

However, AI-powered technology will not replace human security guards anytime soon.

“I think people will provide security to other people for as long as I can think of,” Kaliszan said. “But AI can empower these first responders to be more aware, have situational knowledge, know what to do, and in some cases, prevent problems from occurring.”

He pointed to the Louvre robbery in October, in which scores of crown jewels were stolen from the museum, as an opportunity where AI-powered devices that can actively monitor and then instantly alert security forces could be more effective than physical personnel alone.

“If you could intervene immediately and know in real time that it was happening, the potential for savings and damage prevention would be huge,” he said.