SpiderOak nabs $3.5M for ‘Zero Knowledge’ software

SpiderOak recently closed a multi-million dollar round that will grow its team and boost development of its privacy cloud software.

The company, which creates software that encrypts data without ever learning its actual contents, raised a $3.5 million Series A round that also will help fund its transition from Chicago to Kansas City. Chicago-based OCA Ventures led the round, which also included BW Capital Partners, DRW Venture Capital and KGC Capital.

The servers that SpiderOak employs do not have encryption keys to access files you store with the company. The company’s latest offering, SpiderOakONE, encrypts data prior to transfer from the user’s computer to a secure server which prevents the company from knowing a client’s username, billing information, email address or the amount of data stored.

“For too long users have had to make compromises between usability and privacy,” SpiderOak President Mike McCamon said in a release. “SpiderOakONE is a big step towards providing the most affordable, secure and private cloud backup solution, without making that compromise. While there’s still work to be done, we want to fully enable solutions that offer true privacy in the cloud.”

SpiderOak targets consumers and businesses with its services. Services start at $7 a month for 30 gigabytes for small businesses and the SpiderOakONE service costs $12 a month for 1 terabyte of storage. More than 1 million people have downloaded the company’s software, SpiderOak said in the release.

Edward Snowden, a former CIA employee who leaked classified information from the U.S. National Security Agency in 2013, recommended SpiderOak as a file-sharing app to use.

CEO Alan Fairless, a systems developer of 15 years, leads SpiderOak. Founded in 2007, the company now has about 30 employees. The new funding will allow the company to boost its headcount to about 40 people.