# Claroty Financial Model

Industrial cybersecurity platform that identifies, manages, and protects OT, IoT, and IIoT assets.

- Canonical: https://finamodel.com/startups/claroty
- Excel download: https://finamodel.com/startup-models/claroty.xlsx
- Category: Hardware/Deep-tech
- Model type: SaaS ARR / Valuation
- Funding round: Series D
- Funding: $140M
- Founded: 2021
- Geography: HQ New York City; global operations [DECK, slide 8].
- Customer: B2B

## About the company

Claroty provides industrial cybersecurity for OT, IoT, and IIoT assets. It helps enterprises identify, manage, and protect operational systems that cannot be secured like conventional IT, including environments where availability and safety constraints limit the use of ordinary endpoint-security approaches.

The buyer is typically an enterprise operating sites with specialised assets and long technology lifecycles. This creates a platform revenue opportunity linked to sites, assets, and modules, but also a demanding implementation and services requirement as customers connect industrial networks and coordinate IT and operational teams.

Model enterprise customers, sites, protected assets, platform ARR, implementation, services, module adoption, expansion, renewals, and churn. Include solution engineering, threat research, support, cloud delivery, and sales costs. Site rollout, asset coverage, module attach, contract value, services margin, retention, and sales-cycle duration should determine scenarios.

## What's included

- 5-year monthly revenue build with stage-appropriate growth assumptions
- Full P&L, headcount plan, and operating-expense schedule
- Cash-flow statement, runway, and burn-rate tracking
- Valuation via exit multiple with a DCF cross-check
- Returns analysis with MOIC and IRR
- Unit economics including CAC, LTV, payback, and cohort retention

## Product & value proposition

Claroty's platform claims to be the only solution protecting all assets "within four walls" - OT, IoT, and IIoT. Three core product lines:
- **Claroty Continuous Threat Detection (CTD):** "Right for Me" collection architecture, sophisticated threat detection, threat intelligence.
- **Claroty Edge:** Zero-infrastructure OT security solution - fast deployment, no network changes required; industry first.
- **Claroty Secure Remote Access (SRA):** Zero Trust Network Architecture for OT; compensating controls for insecure OT assets.

Platform capabilities span: Asset Visibility, Vulnerability Management, Threat Detection, Threat Intelligence, Risk Management, Secure Remote Access.

Customer journey framing: three onramps based on enterprise maturity - Understand Your Network → Detect Threats → Control Access.

## Market

- Enterprise IoT spending expected to exceed $4B in 2024.
- Bubble chart (slide 3) shows largest 2024 TAM segments by vertical: Manufacturing & Natural Resources (~$4.0B+, largest bubble), Healthcare Providers and Utilities (high growth %, ~$0.5B), Building Automation, Physical Security, Government.
- OT & IIoT Security Market combined (slide 13):
  - 2018A: OT $1,419M + IIoT $250M = $1,669M
  - 2019E: OT $1,671M + IIoT $380M = $2,051M
  - 2020E: OT $1,969M + IIoT $585M = $2,554M
  - 2021E: OT $2,319M + IIoT $820M = $3,139M
  - 2022E: OT $2,732M + IIoT $1,115M = $3,847M
  - CAGR ~23.2%
- Global IoT-connected devices: 8.6B (2018A) → 10.8B (2019A) → 12.8B (2020E) → 14.6B (2021E).
- 93% of companies will augment/replace OT monitoring systems within 3 years due to IoT adoption.

## Revenue model

- Not explicitly detailed in the deck. Model inferred as enterprise SaaS/subscription given:
  - Platform described as continuously monitoring OT networks.
  - Three distinct product modules (CTD, Edge, SRA) suggest modular licensing or tiered subscription.
  - Channel: direct sales + channel/reseller partners (NTT, Deloitte, KPMG, PwC) + ICS/automation OEM partners (Rockwell, Siemens, Schneider, Yokogawa).
- No ACV, ARR, contract length, or pricing tier data in deck.

## Traction & metrics

- Funding: $100M total raised, Series C.
- Employees: 270+.
- Founded: 2015.
- HQ: New York City.
- Claims market leadership: "leading ICS market in 2020 in terms of new vulnerabilities disclosed".
- No revenue, ARR, customer count, NRR, or growth rate disclosed in deck.

## Competition / moat

Three stated competitive advantages:
1. **Deep Protocol Library:** Proprietary protocol/asset library; vendor relationships for rapid new protocol support; creates barrier to entry.
2. **Best-in-Class Security Research:** ICS vulnerability research and disclosures; threat intelligence; market thought leadership.
3. **Broadest Portfolio:** Widest capability set in industrial cybersecurity (visibility + threat detection + remote access); API-based adjacency expansion.

Self-described as "market leader". Competitive landscape and named competitors not shown.

## Team & funding ask / use of funds

**Leadership:**
- Yaniv Vardi - CEO (Centrica Business Solutions, Panoramic Power, Sparta Systems)
- Galina Antova - Co-Founder, Chief Business Development Officer (Siemens, IBM)
- Benny Porat - Co-Founder, CTO (IDF Unit 8200)
- Udi Bar Sela - CFO (Ormat Technologies, Danaher, AVT)
- Grant Geyer - CPO (RSA Security, Symantec, Riptech)
- Simon Chassar - CRO (NTT, Actifio, VMware)
- Amir Zilberstein - Chairman & Co-Founder (Waterfall Security, Gita Technologies)
- Nadav Zafrir - Board Director (Team8)
- Admiral (ret.) Michael Rogers - Board Advisor Chairman (NSA, US Cyber Command)
- Dave DeWalt - Board Advisor (FireEye, McAfee, EMC)

**Investors:** Rockwell Automation, GM, Bessemer Venture Partners, Schneider Electric, BMW, Temasek, Siemens, IQT (In-Q-Tel), Team8.

## Recommended financial model

- **Archetype + why:** Enterprise SaaS ARR model with multi-module expansion. Claroty sells a platform with three product modules (CTD, Edge, SRA) into large enterprises; revenue is subscription-based and expands as customers add modules. Standard SaaS ARR waterfall (new ARR + expansion ARR - churn = net ARR) with an ACV/seat or site-based pricing construct is most appropriate. No GMV/transaction layer; no insurance or inventory components.

- **Forecast horizon & granularity:** 5 years (2020–2025), quarterly for years 1–2, annual for years 3–5. Deck dated 2020 (copyright), post-Series C.

- **Key drivers & assumptions:**

| Driver | Value |
| -- | -- |
| Total addressable OT+IIoT security market 2020E | $2,554M |
| Market CAGR (2018–2022E) | ~23.2% |
| Market CAGR post-2022 | 18–20% |
| ARR growth rate Y1–Y2 | 60–80% |
| ARR growth rate Y3–Y5 | 35–50% taper |
| Gross margin | 70–75% |
| ACV per customer | $150K–$500K |
| Net Revenue Retention (NRR) | 115–125% |
| New logo adds per year (starting) | 30–50 |
| Sales & Marketing % of revenue | 50–60% |
| R&D % of revenue | 25–35% |
| G&A % of revenue | 10–15% |
| EBITDA margin at maturity (Year 5) | 5–15% |
| Headcount growth | ~30–40% YoY |
| Target verticals (near-term) | Critical Infrastructure, Industrial Manufacturing, Natural Resources, Life Sciences |
| Geographic expansion | US primary → EMEA, APAC |

- **Scenarios (Base / Bull / Bear - which variables flex):**
  - **Base:** ARR grows ~70% Y1, tapering to ~40% by Y5; NRR 118%; gross margin 72%.
  - **Bull:** Faster module adoption (SRA cross-sell accelerates post-COVID remote-work dynamic); NRR 125%+; ARR growth stays above 60% through Y3.
  - **Bear:** Enterprise budget compression; slower OT security adoption; NRR 108%; growth slows to 35% by Y2.
  - Flex variables: new logo adds, ACV, NRR, market share penetration rate, geographic ramp timeline.

- **Required sheets / outputs:**
  1. Assumptions dashboard (all drivers in one place)
  2. ARR waterfall (beginning ARR + new ARR + expansion - churn = ending ARR)
  3. Income Statement (revenue, COGS, gross profit, S&M, R&D, G&A, EBITDA, net income)
  4. Headcount plan (by department: Sales, CS, R&D, G&A)
  5. Cash flow & runway (given $100M raised, model burn and runway to next milestone)
  6. Market share build (TAM × penetration rate cross-check vs. bottoms-up ARR)
  7. Scenario toggle (Base / Bull / Bear)
  8. KPI dashboard (ARR, customers, ACV, NRR, gross margin, burn rate, runway)

## Frequently asked questions

### Is the Claroty financial model free?

Yes. The Claroty model is a free Excel download with live formulas.

### Can I change the assumptions?

Yes. The workbook is editable and its live formulas recalculate when assumptions change.