Asking for information about privacy protection start-ups in Israel (not including those involved with identity management and data protection) raises some eyebrows. “Israel has privacy protection start-ups?” someone asked. Can a country so strong in cybersecurity also sprout cyberprivacy? “Is that even a thing?” someone else asked. “Aren’t the two almost oxymorons of each other?”
Enhancing online privacy
If we say that cybersecurity is about protecting organizations from hacking, then how do we classify cyberprivacy? On Start-Up Nation Finder, we tag as privacy protection those companies whose chief product or service is software that enhances users’ online privacy.
Choosing that tag brings up 65 currently active companies (SNC has mapped 89 but some of these are not active). These 65 start-ups include companies working in areas such as public key identification, secure messaging, VPN, personal P2P clouds, digital footprint management, permissions control, mobile apps to keep children safe from online dangers, and even discreet dating apps.
There’s been a steady increase of companies in privacy protection, which in 2011 had 10 start-ups, growing to 63 in 2017, and 89 (mapped in Finder) by mid-2018. The majority of these are small start-ups with up to 10 employees, and most are bootstrapped.
In terms of funding, by mid-2018 we’ve seen the highest VC-backed financing into this sector for at least four years, with $64M in around 30 funding rounds.
Combatting a growing threat
Why is this market becoming more important now? Why should we keep our eyes on what’s happening in this small, yet growing sector?
For one, the growing threat to online privacy – from the way corporations, criminals and governments alike access, gather and use our personal data – is becoming one of the central issues of our age: how do private citizens live their lives in today’s digital world and still maintain the right to privacy? Almost every day, hundreds of millions of social media and Internet users’ data is processed and analyzed in many ways, often for the benefit of private corporations, and sometimes, sadly, also for political manipulation.
Secondly, the European Union’s General Data Protection Regulation (GDPR), which took effect this year, mandates that any Israeli companies wanting to do business with some of the 500 million EU citizens must comply with the tough new data privacy laws. Privacy protection, in its many forms, could become a burgeoning industry. Privacy conscious companies, with Apple in the lead, are finding that a privacy-first attitude is becoming a competitive edge.
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