As the threat of malicious bot traffic continues to rise, Estonia-based startup Blackwall has raised €45 million in Series B funding to bolster its AI-powered cybersecurity solutions for small and medium-sized businesses (SMBs). The funding round, led by B2B-focused VC firm Dawn Capital, will enable Blackwall to further develop its product roadmap and expand into new markets.

The growing menace of bot traffic has severe implications for SMBs, which often lack the resources to combat these threats. According to cybersecurity entrepreneur Nikita Rozenberg, founder of Blackwall, the impact of bot traffic can be devastating for smaller businesses, stating that "most of these threats can simply kill small businesses." This realization inspired Rozenberg to create Blackwall, which shares similarities with CloudFlare, Imperva, and others, but with a focus on SMBs.

Blackwall's product roadmap has been influenced by its focus on SMBs, with the recent launch of an ad fraud prevention product that prevents e-commerce websites from having their ad spend consumed by bots. The startup's flagship product, GateKeeper, is a reverse proxy that inspects traffic, analyzes it using AI, and filters malicious requests in real-time. This includes threats from bots, intruders, and other malicious actors.

The €45 million funding will help Blackwall develop new products beyond GateKeeper, which has resonated with investors. Dawn Capital, the B2B-focused VC firm backing Blackwall's Series B round, was drawn to the startup's pace of innovation and its focus on SMBs. Blackwall's rebranding from BotGuard reflects its expanded scope, with a new name inspired by the video game Cyberpunk 2077.

Unlike its larger competitors, Blackwall's approach is centered around a "channel model," partnering with intermediaries like hosting service providers, managed service providers, and e-commerce platforms. This strategy enables Blackwall to offer its solutions to SMBs through these partners, providing a differentiation factor and a way to lower costs incurred from malicious traffic.

Blackwall's sales strategy has proven fruitful, with over 100 partnerships helping the startup scale quickly since its launch in 2019. With a team of 65, Blackwall claims that its services are now deployed across more than 2.3 million websites and applications. The new funding will enable the startup to double its headcount and expand into the U.S. and APAC markets, with support from Dawn Capital and VC firm MMC Ventures, which participated in this round.

The growing threat of bot traffic has significant implications for SMBs, and Blackwall's AI-powered cybersecurity solutions are well-positioned to address this need. With its €45 million Series B funding, Blackwall is poised to continue its rapid growth and expansion, providing critical protection to SMBs in the face of escalating cyber threats.