Skyflow, a data-privacy The startup announced on Friday that it has expanded the number of markets where it provides data residency support for companies that need to keep certain information within defined boundaries. In today’s market, you probably can’t keep EU customer data in South America and vice versa, so companies need to be careful to keep some information at home in the market where it was obtained from.
Skyflow started life as a tool to help companies securely store personally identifying information, or PII. Its API helps companies “handle all the difficult privacy, encryption, and data issues of storing PII and other forms of potentially radioactive data for their customers,” we wrote when we last covered the company.
The startup, which recently closed a $45 million Series B round in late 2021, can now support data residency requirements in Japan, India, Indonesia and Bahrain. Kama, Skyflow CEO Anshu Sharma Explained to TechCrunch+, the software will allow companies to offer their services to more markets where data resides and secure storage of personal user information while meeting local regulatory requirements.
Sharma argued that his company’s newly expanded regional data storage capabilities would provide ways for other companies to help avoid the complexity of launching their own data storage and security infrastructure only in new markets.
Skyflow’s task of supporting more regions didn’t come cheap. Sharma said the work had a “high fixed cost”, which Skyflow could afford because it had “raised a lot of money,” enabling it to “take on infrastructure and operational costs” for its customers. (As an aside, this is what venture capital is for: to grow beyond revenue in hopes of gathering outsized market share.)
Given that every tech company — startup and major alike — wants to squeeze every scrap of growth possible in the current slow market, you can see why Skyflow expects a return on its spending. If software companies continue to push to reach new markets to sell their services, they will have to navigate a series of data regulations and rules on their own. Or they could work with Skyflow or one of its competitors — Evervault, Protegriity, etc. — to help meet local requirements.
So far, Skyflow has received remarkable international acceptance. Sharma told TechCrunch+ that his business does more than 40% of its current business with non-US customers. The CEO was quick to point out—pulling out S-1 filings during our call—that some well-known software companies made a low-double-digit portion of their revenue from international markets when they went public. It will be curious to see whether more regional support pushes that figure above 50% over time; We’ll check back with the startup in a few quarters.
Where does generative AI come into this?
Skyflow initially focused on serving the Fintech and Healthcare verticals. However, it recently built a version of its data storage service to support generative AI services, so when we had Sharma over to talk Data Residency, we looked at the market demand for software services related to LLM. Also asked some questions about
Through Startups, it envisions how to sit between corporate know-how and the LL.M. Image Credits: skyflow
First, we wanted to find out whether the startup had built the tool before there was a known demand or anticipated need. Per Sharma, his startup started getting calls a few months ago from customers about generative AI and how those companies need to keep not only PII but also internally sensitive data away from LLM. Demand is coming from both bottom-up use of generative AI tools and executive-level curiosity, he said. Put another way, both corporate drones and corporate devs alike want to use generative AI, but they don’t want to be bothered by the kind of data leaks we’ve already seen in the market.
