Observed Signal · Oct 28, 2026 · Funding · Source: techcrunch · Impact: 4/5 · Sentiment: Positive
Upwind Raises $400M, Rejects Datadog Acquisition Offer
Cloud security startup Upwind has raised a $400 million Series C round at a $3.8 billion valuation, led by Bessemer Venture Partners with participation from Greylock Partners and Craft Ventures. The company rejected an acquisition offer from Datadog, which matched the valuation but did not offer a premium. Upwind has been growing rapidly, adding $20-30 million in annualized recurring revenue (ARR) each quarter and is projected to end the year at roughly $90 million ARR. The company's valuation represents a multiple of over 40x forward ARR, below the 80x ARR fetched by Cyera earlier this year. Upwind plans to remain independent, believing its long-term value exceeds the offer. The Series C comes nine months after a $250 million round at a $1.5 billion valuation.
A significant funding round in the cybersecurity sector, driven by AI, with a notable rejection of an acquisition, indicating strong market confidence and growth projections. The deal highlights investor appetite for AI-enabled security solutions and the company's strategic independence.
Track Datadog Signals & Market Shifts in Real-Time
Polaris7 autonomous intelligence agents track regulatory filings, primary sources, executive changes, and deal flow 24/7. Create your Polaris7 workspace to monitor these entities.
Key Takeaways & Evidence Grounding
- Upwind raised $400 million in Series C funding at a $3.8 billion valuation.
- Bessemer Venture Partners led the round, with participation from Greylock Partners and Craft Ventures.
- Upwind rejected an acquisition offer from Datadog, which matched the $3.8 billion valuation but offered no premium.
- Upwind projected to end the year at roughly $90 million in annualized recurring revenue.
- Series C comes nine months after a $250 million round at a $1.5 billion valuation.
Connected Companies & Entities
5 Entities mapped“Datadog attempted to buy the company, offering no premium above the $3.8 billion valuation.”
“Participation from existing backers including Greylock Partners and Craft Ventures.”
“Participation from existing backers including Greylock Partners and Craft Ventures.”
“The round was led by Bessemer Venture Partners.”
“Founder Amiram Shachar sold his previous company, Spot.io, to NetApp for $450 million.”
Related Market Signals & Shifts
Recent verified developments and strategic activity across this market segment.
WindBorne wins $50M US Air Force contract for balloon data
WindBorne Systems, a startup based in Redwood City, California, has secured a contract with the U.S. Air Force worth up to $49 million for its autonomous weather balloon data. The company operates about 700 balloons globally, collecting atmospheric data that feeds its AI weather forecasting model. The contract is the largest for WindBorne, though the Air Force pays incrementally, with $1.7 million ordered so far. The award was made without competitive bidding, highlighting the company's unique capability. WindBorne also recently raised $37 million in Series B funding and released WeatherMesh 6, which it claims outperforms traditional ECMWF forecasts. The contract supports continued expansion of the balloon constellation and R&D efforts. This deal underscores the growing importance of AI-driven weather intelligence for government operations.
Analyst Flags Datadog as Overpriced Despite AI Tailwind
Todd Gordon's CNBC column analyzes Datadog (DDOG), praising its role in cloud observability and recent growth driven by AI-related monitoring products and large deals, while warning the stock is richly valued. Datadog reported record Q1 2026 results with revenue topping $1 billion (up ~32%) and ARR above $4 billion. The firm added GPU monitoring and LLM observability, won FedRAMP High certification, and counts many AI-native customers. Despite strong technical patterns and rising analyst estimates, Gordon highlights high forward multiples (about 108x earnings; 10–11x sales), concentration of AI revenue among a few large customers, prior source-code breach, and that Bernstein trimmed its rating, concluding investors should be cautious and size positions with discipline.
Blackwall Raises $100M at $2.2B Valuation
Estonian cybersecurity startup Blackwall, formerly BotGuard, has raised $100 million in a Series C funding round, quadrupling its valuation to $2.2 billion. The round was led by AVP, with participation from existing investors Dawn Capital, MMC Ventures, and Tera Ventures. Blackwall builds web traffic security tools for hosting, cloud, and managed service providers, focusing on bot mitigation, DDoS protection, web application firewall, load balancing, server-side encryption, and management of agentic AI traffic. The company uses a channel approach, offering white-label security bundles under providers' own branding, and employs digital fingerprinting and AI models to differentiate legitimate AI agents from malicious bots. The funding will accelerate expansion into a global traffic management ecosystem across 12 strategic regions in North America, Europe, Asia-Pacific, and the Middle East, competing with Cloudflare's AI Crawl Control, Akamai, and Imperva, but differentiating by not selling directly to website operators.
Receive all future signals for Datadog & competitors in your briefing
Never miss material M&A deals, leadership changes, account wins, or product rollouts. Polaris7 monitors 20,000+ primary sources 24/7, delivering verified telemetry directly into your executive briefing.