Building a European data privacy champion

Why is data protection important?

Data breaches continue to create significant damage around the world. In the past, a lot of private data was stored by companies over extensive time periods, which increased the severity of these data breaches. As a result, in 2018, The European General Data Protection Regulation (GDPR) came into effect with one core goal: Provide better protection of sensitive private data. Most notably, GDPR provides guidance on the processing and storage of customer data. Based on GDPR, individuals have the right to demand an overview and the deletion of private data at any time. Furthermore, data can only be stored as long as there is a customer relationship. Failure to comply with GDPR can lead to significant fines. Since becoming legally enforceable, fines have been imposed on numerous companies for GDPR violations, although a major "wave of lawsuits" has so far failed to materialize. We expect fines to increase over the next years as legislators are putting more emphasis on the adherence to GDPR rules, following a multi-year “grace period” after the introduction.

How is Kertos addressing GDPR compliance, and how are they different to other solutions?

Following the introduction of GDPR rules, many agency-based businesses have emerged. They provide consulting services for their clients to establish GDPR-compliant processes and/ or to serve as external data privacy officers. These solutions provided initial relief to clients because GDPR audits were basically “outsourced”. However, the execution of those defined GDPR-compliant processes remains internal. Most data privacy processes, including the deletion of data or the establishing of procedure directories, are manual, cumbersome, and error prone. The complexity of these processes is increasing because of the fragmented software landscape, the constantly growing amount of data, and increasing diversity of systems (average organizations employ more than 100 SaaS providers). Kertos is building the automated operating system for privacy processes. The Kertos no-code software enables companies to connect their entire IT landscape via APIs and build their custom, automated data privacy workflows.

Why we invested in Kertos

We have been following the market for data compliance closely. We are convinced that process automation will be the next logical step in the field of data privacy and compliance. For comparison, the US market is already further advanced in that aspect. Yet, the European focus on GDPR prevents them from entering European markets. The three founders of Kertos, Kilian, Johannes, and Alex convinced us with their deep market knowledge and the right skills to build the Kertos software. Kertos has a strong USP in the market because most competitors are focusing on setting up GDPR-compliant processes but neglect the execution of those. Given the complexity of the software stack and Kertos’ resulting deep integration into company processes, we expect high switching costs for customers. Given the adoption of GDPR within the European Union and the product scalability, we believe that Kertos has the potential to become the next European data privacy champion.

xdeck and Kertos

To put it into the words of Kilian Schmidt:

"Working with xdeck ventures was a true partnership right from the beginning. They were early investors with a bold opinion and have been a strong supporter since then. We are fortunate to partner with them and they are providing us with much more than just financial support, namely strategic guidance, network, and being a loyal sparring partner whenever needed."

We have been fortunate to support Kertos since their pre-seed financing round and extend our investment in this seed round. Together with lead-investors VR Ventures and 10x Founders and co-investors Pi Labs and Seed+Speed Ventures, we support the founders in their go-to-market strategy. Over the past months, we have mainly focused on finetuning the ideal customer profile and adapting sales messages to those customers’ needs. Following this financing round, Kertos is well-equipped to extend their customer base and expand into new market segments. We look forward to contributing to this journey!