After a $12.5 million capital raise, a local technology company aims to add more engineering talent and expand its offerings to more customers in the U.S., Europe and Asia.
Codenotary develops tools for maintaining software supply chain integrity and identifying vulnerabilities, like malware, embedded in software. The tech firm, led by CEO Moshe Bar, currently serves more than 130 enterprise clients. In order to expand with additional customers, Codenotary needs to bring on more sales and engineering talent, Bar said.
Codenotary plans to expand its engineering team by about 100% this year. The firm currently has a headcount of around 30 and plans to reach 60 to 65 employees by the end of 2022.
Bar and certain Codenotary employees in finance and other functions operate out of the firm's sole office at 6750 W. Loop S. in Bellaire, but the majority of the Codenotary team has worked remotely since the start of the Covid-19 pandemic. As more and more out-of-state tech companies move their headquarters to Texas, the competition for strong engineering talent in and around Houston has increased, Bar said. Being a distributed team has allowed Codenotary to recruit and hire strong talent regardless of where they live.
"Even when we have people here in Houston, we don't really require them to come to the office," Bar said.
Bar is a serial founder in the software and technology spaces. He co-founded Qumranet Inc., which was acquired by Red Hat Inc. for $127 million in 2008. He also previously co-founded hypervisor software company XenSource, which was acquired by Citrix for $500 million in 2007.
After his previous experience in software for enterprises and data centers, Bar noticed that large, well-known organizations, like banks, credit rating agencies and technology companies, were getting hacked using new methods. In years past, hackers were focused on gaining entry through the perimeters of a network, like firewalls or exposed servers. But the attack vector has changed in the past three or four years, Bar said.
"Nowadays, 99% of all the hacks that you read about everyday in the newspapers, they happened because developers inside those organizations unknowingly import malware from the outside in," Bar said. "It takes just two or three seconds nowadays to import some software from a development library from the outside into the organization."
Now, Codenotary's client base is strong in the financial services sector, but the company wants to increase its focus on expanding in the federal government and health care sectors, Bar said.
Codenotary has raised over $18 million in total funding to date, including a $5.5 million Series A round in 2020 and the recently announced $12.5 million Series B round.
The company was founded as Vchain Inc., which developed a product called Codenotary. Bar said the firm changed its company name to Codenotary in late 2020.
