Toronto-based virtual private network (VPN) startup Tailscale announced it has raised $230 million in Series C funding to expand its team and meet rising demand from artificial intelligence (AI) companies.
Co-founded in 2019 by Waterloo Engineering alumni Avery Pennarun and David Carney (both BASc ’01, computer engineering), the company offers a secure VPN that simplifies access to private networks.
The all-equity funding round was led by Silicon Valley venture capital firm Accel, with participation from returning investors CRV, Insight Partners, Heavybit and Uncork Capital. High-profile angel investors also joined the round, such as Crowdstrike CEO George Kurtz and Squarespace CEO Anthony Casalena.
Tailscale has seen a 20 per cent increase in business clients since January and year-over-year revenue growth of over 100 per cent. The company serves over 10,000 clients including Perplexity, Mistral, Hugging Face and Cohere.
“Tailscale intends to remain independent and we are on a likely IPO track, although any IPO is several years out,” Pennarun, Tailscale CEO, said in a media article.
“Meanwhile, we have an extremely efficient business model, rapid revenue acceleration, and a long runway that allows us to become profitable when needed, which means we can weather all kinds of economic storms.”