This post is by Cat Zakrzewski from Venture Capital Dispatch
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GreatHorn Inc. wants to stop phishing attacks, a social-engineered form of cyberattack, before they even reach an employee’s inbox.
The company has raised $2.25 million in seed funding, led by ff Venture Capital and SoftTech Ventures. Techstars Ventures, RRE Ventures and Walter Winshall also participated, alongside Zelkova Ventures and V1.VC.
The funding comes after fraudsters have been using phishing attacks to file tax returns. There have been several incidents this year in which human-resources employees received fake emails from scammers impersonating company executives. The emails request W2 forms or personal information about other employees, such as Social Security Numbers. If the employee thinks they are actually coming from the top brass and responds with information, it can leave other employees vulnerable to identity theft and tax fraud.
So-called spear phishing attacks are the third most common incident that compromises an organization’s IT networks, according to a study from the Ponemon Institute . Exploits of existing software vulnerability and general malware were more common.
But recently venture capitalists have been paying attention to phishing. Earlier this year, KnowBe4 Inc. raised $8 million to thwart phishing attacks. Last year security startup PhishMe Inc. secured a $13 million investment.
GreatHorn Chief Executive Kevin O’Brien said his product integrates into email platforms such as Google Apps and Office 365 to detect advanced phishing attacks that spam filters miss. The company, which launched in October 2015, has a dozen clients, securing the inboxes of more than 10,000 employees.
“Our theory is that the primary cause of the largest data breaches is essentially going to be a communications platform,” Mr. O’Brien said.
One of the most common ways that hackers trick employees into sending them company data, credentials or intellectual property is by using emails at domains that look similar to the company name. One way GreatHorn stops fraudulent emails from hitting employees’ inboxes is by detecting these homographs, Mr. O’Brien said.
The new capital will be used to expand the team’s operation and further develop its product line.
To read more about GreatHorn Inc. and how it stacks up against other companies trying to thwart phishing attacks, go to Dow Jones VentureWire.