Scrut founders Kush Kaushik, Aayush Ghosh Choudhury and Jayesh Gadewar
For many expanding businesses, managing risk is as big a challenge as sustaining their growth; as they get larger, staying on top of everything from cyber security to regulatory compliance becomes a bigger and bigger job, with resources often in short supply. And the technology solutions that larger enterprises use to confront this issue are too costly – and take too long to implement – for smaller organisations.
Scrut Automation, a San Francisco-based start-up that is today announcing the successful raise of $10 million of growth capital, is targeting exactly this problem. “We’re focused on mid-market businesses, particularly in heavily regulated sectors such as financial services and healthcare,” explains CEO Aayush Ghosh Choudhury, who co-founded the company in 2021 with Kush Kaushik and Jayesh Gadewar.
“These organisations have limited options,” Choudhury explains. “They can buy off-the-shelf compliance automation tools that offer a one-size-fits-all approach to compliance, disconnected from the organisation’s risks; or invest in expensive enterprise-grade tools with year-long implementations and features they will never fully use.”
Scrut offers a middle way for businesses struggling with their governance, risk and compliance (GRC) responsibilities. Its software platform is designed to enable even small GRC teams to stay on top of such work as the organisation grows around them and other functions expand. By connecting with the software systems these functions use, Scrut’s software can automate the collection of all the data that the GRC team needs to manage controls across the organisation.
The goal is to give the GRC team much greater visibility of how the rest of the organisation is performing against the risk management and compliance metrics it has set itself, without the team having to manually collect the evidence it needs on a continual basis. With a near real-time picture of the organisation's GRC performance, the team can then put remediation measures in place where shortcomings are identified.
Unlike enterprise-grade GRC solutions, which can take several months to get up and running, Scrut says its alternative can be implemented within two to three weeks. The software is customisable to the organisation’s needs and Scrut has built practice areas for several regulated industries.
“Compliance is a team sport,” says Choudhury. “The GRC team may ultimately be responsible – and accountable – but it is dependent on multiple other functions to do its job effectively, so making collaboration and communication with those functions much more seamless is crucial for effective risk management.”
The argument appears to be resonating with customers. Since its launch at the end of 2021, Scrut has delivered annualised revenue growth of 350% and now has more than 800 customers. G2, a social software review platform, recently ranked the business as one of the fastest growing in its sector.
Investors in the business are enthusiastic about its growth prospects too, with today’s fundraising taking the total amount of money raised by the company to just over $20 million. This latest raise is led by existing investors Lightspeed, MassMutual Ventures and Endiya Partners.
"A strong security posture has always been a core need for large enterprises globally, but given the increase in the number of breaches and attacks over the past few years, as well as increases in regulatory compliance requirements, mid-sized enterprises are now adopting strong GRC practices too,” says Dev Khare, a partner at Lighspeed. “Scrut's user-friendly and market-leading platform reduces this burden for security and GRC teams.”
At MassMutual Ventures, managing partner Anvesh Ramineni adds: “Legacy GRC products are built for enterprises, but fail to meet the needs of high-growth technology-first companies – Scrut is built specifically to cater to their needs and addresses their pain points seamlessly.”
Choudhury said most of the cash raised would be used to support further research and development at the company. Scrut is currently developing a further range of tools that leverage artificial intelligence technologies to support compliance work.
