This Tysons startup is upending the regulatory compliance space with software

Already in its short four months of life, Tysons, Virginia-based regulatory compliance tech company RegScale has already racked up a few noteworthy achievements.

In January, Technical.ly awarded it an honorable mention spot on our annual RealLIST Startups roundup. That came after the company, which spun out of digital services firm C2 Labs in late 2021, raised $1.5 million from the Virginia Innovation Partnerships Corporation and New Dominion Angels to help build out its technology late last year.

Compliance tech — which helps companies manage their regulatory requirements and needs — is something that CEO Anil Karmel said is new to the security world. Up until now, he told Technical.ly, companies would often maintain their compliance needs in Excel sheets. RegScale, meanwhile, helps keep paperwork up to date in an API-centric SaaS platform.

“That’s just the way it’s been done — it’s the way it continues to be done,” Karmel told Technical.ly. “So our thesis was leveraged in the regulatory technology space, which is what we say is the reg tech space: how can we service this bridge between security and compliance so it’s not ‘either-or,’ it’s ‘and?'”

With RegScale, Karmel said, he hopes to bring the principles of DevOps to compliance in an idea he calls regulatory operations — or RegOps. The platform, which is built with Angular, .NET and SQL, is designed to deploy in a number of existing systems. The RegScale platform will make system audits, issue plans of action, assess risks and note upcoming deadlines and tasks in compliance, among other offerings. There’s both a free model and a paid edition of the software, Karmel said, because he believes compliance should be affordable.

On the whole, he hopes that RegScale can help companies move away from the traditional methods of compliance that have been done for decades.

“We’re calling it the RegOps movement,” Karmel said. “Every movement begins with a single step and we have technology, but it’s also a cultural change. So it’s helping organizations understand, and people understand, there’s a new way to do compliance.”

RegScale was funded out of C2 Labs, and the spinout closed an early round of capital after incubating its technology internally, Karmel said. In November, it raised the aforementioned $1.5 million for its research and development arm, including staffing that division. The company is currently hiring for operations staff in Virginia and will continue building out RegScale here. The founder is also hoping to build a large partner ecosystem where companies can further integrate RegScale into their systems.

But in the nearer future, the company is still looking to grow. Next, Karmel and RegScale intend to open a Series A, which will lead to even more hiring. (See open role here.)

Then and now, Karmel said he’ll keep an eye out for folks looking to make a change in compliance and regulation tech: “If you’re looking to reimagine an industry with a new innovative technology to reimagine compliance, both from a technology standpoint as well as from an implementation standpoint, those are folks we’d love to talk to.”