Bitwarden, an open source password manager for enterprises and consumers, has raised $100 million in a round of funding led by PSG with Battery Ventures Farm.
Initially founded back in 2015, Santa Barbara, California-based Bitwarden operates in a space that includes notables like 1Password, which recently hit a $6.8 billion valuation on the back of a $620 million fundraising, and LastPass, which recently spun off. After two years of being taken over by private equity firms, it has re-emerged as an independent company.
In a nutshell, Bitwarden and its ilk make it easy for people to automatically generate guessable passwords and store them all in a secure digital vault — helping people avoid reusing the same guessed password across all their online accounts.
On top of its basic free service that gives people access to unlimited password storage across platforms, Bitwarden offers premium tools and services for payment, including advanced enterprise features such as single sign-on (SSO) integrations and identity management. Bitwarden’s big differentiator, of course, is that it’s built on an open-source codebase, which is a good thing for super security-conscious individuals and businesses, as it allows full inspection of the platform’s inner workings. Moreover, people can contribute back to the codebase and accelerate the development of new features.
Today’s “minority growth investment” marks the first fully disclosed external funding in Bitwarden’s seven-year history, but Technology Flow is reliably informed that the company raised a previously undisclosed Series A round back in 2019.
Its latest cash injection, however, points to how the world has changed over the past few years – the rise of remote work means people often mesh personal and work accounts on the same devices, using the same password as their myriad. Online Accounts. Such poor password hygiene puts businesses at risk, which is why they’re looking for ways to encourage their workforce to use security-focused tools like password managers.
Our investment in Bitwarden reflects our belief that the password management market is poised for significant growth as online account usage increases and security concerns increase in hybrid working environments, PSG Managing Director Tom Reardon said in a press release.
Additionally, increasing competition and VC investment in the password management space means Bitwarden can’t rest on its laurels – it needs to expand, and its funds will be used to do so. The company confirmed plans to expand its offering across several aligned security and privacy verticals, including secrets management — which 1Password expanded last year through its SecretHub acquisition.
“The timing of the investment is ideal, as we expand opportunities in developer privacy, password-free technologies and authentication,” said Bitwarden CEO Michael Crandell. “Most importantly, we aim to continue serving all Bitwarden users for the long term.”