TrueVault Raises $2.5 Million in Two Days for HIPAA Compliant Data Warehousing Service

2014-04-01_17-22-18

Mountain View, Calif.-based TrueVault raises a $2.5 million seed round contributed over two days by a large group of diverse investors, including: FundersClub, and a list of angel investors that includes Joel Milne and Andreessen Horowitz. In total, 22 investors participated in the massive round for the startup.

The funding came in over 48 hours just after TrueVault founders Trey Swann and Jason Wang presented their slides at the most recent Y Combinator demo day. Investors flocked toward them following their presentation, driven largely by claims of 47 percent weekly revenue growth and plans of expanding out of healthcare and into a broader digital security services market.

TrueVault presented a working business model on stage. The company takes ownership of all HIPAA related processes for mHealth startups, from data transmission through long-term data storage. The company delivers a secure RESTful API that startups use to securely transmit data into, and retrieve data out of, TrueVault’s HIPAA compliant databases. TrueVault will also sign HIPAA Business Associates Agreements for its customers and take legal ownership of breaches through a data breach insurance policy. This gives mHealth startups an opportunity to focus on design and development, rather than navigating unfamiliar regulatory waters.

Data coming through the TrueVault network is passed first through the HTTPS API and then through a 256-bit AES data encryption layer. From here, the encryption key is peeled off and stored in a separate server stack with no programming knowledge of how the keys are used. The encrypted files make their way to an encrypted file storage database. All files and encryption keys are randomly re-encrypted periodically to further increase overall data security. The infrastructure has been designed from the ground up to make it an daunting target for would-be data thieves.

To keep things simple for startups, onboarding costs are free, and the billing process is setup as a pay-as-you-go model, so there are no contracts. To monetize the platform, TrueVault charges a flat rate of $0.001 per API call. Currently, this generates $15,000 per month from its current 300 customers.

TrueVault is focusing on healthcare, which they describe as a beachhead that will allow them to attack the overall digital security market. In the wake of Target and TJX data breaches, investors at Y Cominator’s demo day were drawn to a startup with the potential to introduce a meaningful solution to what has become a very real problem.


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