They have a data inventory problem. The amount of data being collected and stored is rising, and that data is being spread out across very disparate storage buckets. Still, many organizations rely on processes that basically come down to pencil-and-paper methods for tracking data provenance. One survey found that more than 50% of companies use Excel spreadsheets in their data privacy and compliance efforts.

Karthik Krishnan, Shankar Subramaniam and Madhu Shashanka thought they may have the engineering chops to build something that will make this process easier for companies. The three had cut their teeth in cybersecurity: Years ago, Subramaniam and Shashanka had recruited Krishnan as one of the first employees at their behavioural analytics startup, Niara.

It was almost three years since Hewlett Packard had acquired Niara when the trio started charting out ideas for an enterprise data management tool. Their product would catalog important data in a company, including what's inside those often inaccessible places, and automatically flag data that's at risk of being compromised.

"We hoped to solve one of the most pressing data security challenges facing the modern enterprise, Krishnan said in an interview with TechCrunch. "That is: identifying and securing business-critical information within structured and unstructured data, stored on-premises or in the cloud, at scale."

The trio built an MVP and founded Concentric AI to further develop and commercialize it. It works with industrial manufacturing, insurance, and higher education clients, including car insurance carrier Hagerty and DeVry University.

Krishnan explained how the tech works.

A customer then ties Concentric to its databases, data stores, email and messaging apps, and even generative AI chatbots like Microsoft Copilot. Concentric then uses AI to find sensitive data, such as passwords, private files, audio and video recordings of meetings, in those tied places.

Concentric also gives the customer suggestions on how to better secure its data and comply with the proper standards. It also traces lineage, showing where a particular piece of data came from and how it is used.

"Operationalizing data security is a huge challenge," Krishnan said. "With Concentric, customers can identify anomalous activity and remediate those issues to prevent data loss."

But isn't there a huge security risk to gathering all this company data? What if Concentric gets hacked, or what if hackers try to intercept data flowing between apps and Concentric's platform?

Krishnan said that Concentric does not work with raw data; instead, it creates semantic representations of the data as well as categories of the data. "Concentric AI products do not store sensitive user data," he said.

Concentric isn't alone in the market for data protection, which one estimate predicts could be worth more than $500 billion by 2032. The startup competes against Varonis, BigID, Netwrix, Spirion, Cyera, and Securiti among other vendors.

Still, Krishnan said that Concentric's client base is growing at a healthy clip: It's jumped 300% from a year earlier.

What is probably driving the boom is that the amount of data organizations have to handle continues to grow. Data professionals polled by Matillion report that, on average, their company's data volumes increase by 63% a month.

"There's an unprecedented demand for data security posture management globally," Krishnan said.

Concentric, based out of San Mateo, has raised $45 million in a Series B round that was led in equal portions by Top Tier Capital Partners and HarbourVest. The other participants in this round included CyberFuture, Ballistic Ventures, Citi Ventures, Engineering Capital, and Clear Ventures. The new round puts the total capital raised by the company at $67 million, and the fresh cash will be used to enlarge Concentric's partner program as well as the product portfolio and increase headcount to 125 people by 2025.