Dellfer, an automotive and IoT cybersecurity software company, announced an $8 million Series A investment from mobility supplier DENSO and specialist cybersecurity private equity firm Option3.
The funds will be used to accelerate the time to market for its cybersecurity solutions for the automotive industry, Dellfer said. The three companies noted that the automotive industry and other IoT environments increasingly require cybersecurity solutions to protect potential vulnerabilities.
“The requirement for cybersecurity solutions for auto manufacturers has never been stronger,” Tony Cannestra, DENSO’s director of corporate ventures and Dellfer board member, said in a Tuesday (Oct. 19) press release. “We tested a wide array of available software solutions and found Dellfer’s approach to be highly valuable and a good fit for our customers’ needs.”
Areas With Greatest Future Vulnerability
“This investment underscores Option3’s targeted approach cybersecurity investing, focusing on those areas with the greatest future vulnerability, like automobile cybersecurity,” said Manish Thakur, managing partner at Option3 and a Dellfer board member. “As a cyber specialist, we truly believe Dellfer’s approach is the best in the industry.”
As part of the investment, both companies will jointly participate on Dellfer’s board to provide operational and sales channel support, DENSO said in a press release.
With a specialty in cybersecurity for the automotive industry, Dellfer delivers a holistic solution providing high-level visibility and granular, actionable insights to thwart intrusions in automobiles.
The company explains the need for these solutions on its web page devoted to the automotive industry. For one thing, today’s new cars contain up to 100 electronic control units (ECUs) and 100 million to 150 million lines of code.
Cars are Now Rolling Computers
“Tech is a major reason why the average cost of a new vehicle in the U.S. in late 2020 exceeded $40,000,” Dellfer says. “That’s just the average. Because cars are now rolling computers, 40% of the cost is in electronic systems.”
At the same time, the company adds, global cybercrimes are estimated to reach $6 trillion by the end of 2021 and continue to grow 15% annually, reaching $10 trillion by 2025.
Put those facts together and there is a risk to connected vehicles. The National Highway Traffic Safety Administration (NHTSA) reports that the first and only (at this time) cybersecurity-related recall occurred in 2015 and impacted 1.4 million vehicles. Dellfer says that recall of Jeep vehicles is estimated to have cost Fiat Chrysler Automobiles (FCA) around $600 million in fines, lawsuits, insurance and fixing/recall costs.
As PYMNTS reported at the time, Uber hired two high-profile security hackers who exposed a major automobile security loophole by hacking into a moving Jeep Cherokee in 2015. They joined Uber’s Advanced Technologies Center to work with the company’s top security officers to build out a safety and security program.
Similarly, PYMNTS reported, General Motors (GM) was using feedback from the public on potential security risks to better understand its vulnerabilities and build up its cybersecurity initiatives.
The need for cybersecurity will only increase as more commerce comes into the car. In August, Car IQ partnered with BlackBerry to create an autonomous and highly secure payment system for connected cars, PYMNTS reported.