Bucharest-based Sypher, a startup offering a virtual GDPR assistant, which collects and organizes data, targets a €550K funding on SeedBlink. The campaign is led by a €225K investment from the early-stage VC Sparking Capital and a €100K from the majority shareholder of Romstal Group, one of the largest Eastern European distributors for electrical and insulation materials. The round will be used to increase their marketing and sales teams and activities.
“Our priority are the markets in Germany, France, and the UK, mainly because the local supervisory authorities are particularly active. In 2021, we also aim to have a more intense presence on the Central and Eastern European market,” Mihai Ghita, co-founder of Sypher, shared with The Recursive.
Sypher is working on simplifying the General Data Protection Regulation processes that businesses had to face since the EU Regulation was adopted in 2016. It is a software platform targeting privacy professionals to save them time and lower the costs for businesses. It aims to help companies collect, organize and review the information needed to assess, document, and maintain GDPR compliance.
“It allows privacy professionals to spend more time analyzing, advising, and monitoring compliance (instead of chasing people for information and doing project management), and helps organizations find and fill gaps in their ability to demonstrate and maintain GDPR compliance,” Ghita shared.
The GDPR startup estimates that the global market size for privacy management software will reach almost €2B in the next three years, with a 14% estimated compound annual growth rate (CAGR). While the GRC (Governance, risk, and compliance) Software Market will be over €30B and have a 13.7% estimated CAGR.
Their research details that in Europe there are over 500K companies with a Data Protection Officer and they believe that over 70% of them do not work with a dedicated software solution. Ghita shares that the growth driver of the niche is “the natural evolution process towards formalizing privacy management and integrating it into daily business activities”.
The evolution of Sypher
Sypher was co-founded in 2017 by Cristian Badea and Mihai Ghita. Previously, Badea co-founded Avangate, a payment software company acquired by Francisco Partners in 2013, while Ghita had experience as a software developer.
They received their first round of investment of around €300K in 2018 from GapMinder VC and a private investor, which they used to grow the team and transition from the MVP to a fully developed product.
“If in the first years we focused on product development, to ensure that it is competitive in terms of functionality and we have a high degree of customer satisfaction,” Ghita says.
Ghita shared that the main challenge back then was keeping up with their clients’ needs. They started with a product that only covered the creation of a GDPR register and now customers have a tool that guides them and ensures control mechanisms are in place.
Currently, the company is valued at €2.2M and it has over 100 clients in five countries, from industries like banking, insurance, retail, media, and technology, half of which are in Romania. It has also reached the Bulgarian market through a partnership with Mediapost HitMail in 2019.