Vaultive, a provider of cloud data encryption solutions, has completed a $10-million funding round, which was led by 406 Ventures, New Science Ventures and Harmony Partners. Vaultive for Hosted Exchange, the company’s first product in beta testing, is a patent-pending enterprise-class encryption solution, the company claims.

No doubt, encryption services are gaining momentum among cloud services providers and managed services providers. A growing number of Microsoft Exchange hosting providers, such as Intermedia, offer encryption services with their cloud email services.

Now here comes Vaultive. Along with the $10-million funding round, Elad Yoran, a long-time security industry leader, becomes Vaultive’s Chairman and CEO. Yoran founded several successful start-ups including Riptech, MediaSentry, and Sentrigo, which was acquired by Symantec, Safenet and McAfee. Currently, he serves as an advisor to the FBI, as well as other governmental organizations.

Yorn joins Ben Matzkel, a prior McAfee senior product manager, and Maayan Tal, formerly head of the R&D team in Israel of McAfee. Both Matzkel and Tal are veterans of leading technology units in Israel Defense Forces.

Maria Cirino, co-founder of .406 ventures, joins Vaultive’s Board of Directors, along with New Science Ventures’s Somu Subramaniam.

Vaultive's core technology allows encrypted data to be searched, indexed, sorted and otherwise processed within a cloud-based application without first having to be decrypted.

Vaultive for Hosted Exchange is expected to debut in April 2012. Companies that sign up for the beta program by March 31, 2012 will receive Vaultive for Hosted Exchange for up to 250 mailboxes at no charge for six months. We're checking to see how Vaultive potentially plans to engage channel partners.