Massive valuations and acquisitions – Cato, Cisco, Splunk & SentinelOne! – ESW #332
This week we talk about finding, acquisitions and the state of the market. If you're interested in cybersecurity market discussion, this is the episode for you.
We also discuss what makes a cybersecurity influencer.
Announcements
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Hosts
- 1. FUNDING: Cato Networks Raises $238M in Equity Investment at Over $3B Valuation
Shlomo Kramer's ~8 year old startup hits another milestone, raising $238M, led by LightSpeed Venture Partners, who has led the last 4 rounds. The company's previous raise was a $200m Series F, and has been a unicorn since the $130m Series E raise in November 2020.
Some stats: $100m ARR crossed in 2022 60% YoY revenue growth 95% gross dollar retention rate
- 2. FUNDING: HiddenLayer Raises $50M in Series A Funding to Safeguard AI
Surprised it took this long! Hiddenlayer took home the win from RSAC's Innovation Sandbox earlier this year.
- 3. FUNDING: Binalyze Raises $19M in Series A Funding
Estonia-based provider of Digital Forensics and Incident Response (DFIR) solutions, raised $19M in Series A funding, led by Molten Ventures.
- 4. FUNDING: Cybersecurity startup Deduce raises $9M for its generative AI Identity fraud solution – SiliconANGLE
Yeah, we're apparently already at the point where this is a thing companies need. Check out the messaging though, and tell me what you think: https://www.deduce.com/
- 5. FUNDING: Patronus AI Launches Out of Stealth to Help Enterprises Deploy Large Language Models Safely
"$3 million seed funding round led by Lightspeed Venture Partners"
Only $3m???
- 6. FUNDING: Goldilock Secures $1.7 million USD Seed Round Led by New York Angels and Harvard Business School Alumni Angels of Greater New York
Interesting - online airgaps? Network segmentation? Interesting focus and timing. Regardless of my hesitation about the product, their site does a great job of explaining what they do: https://goldilock.com/
- 7. ACQUISITIONS: CrowdStrike confirms its Bionic.ai acquisition for $350M today
- 8. ACQUISITIONS: Cisco acquires cybersecurity company Splunk in cash deal worth $28 billion
Cisco's largest acquisition ever, and perhaps the largest cybersecurity deal ever??
- 9. (NON)ACQUISITIONS: Cisco pulled out of SentinelOne acquisition after due diligence revealed ARR inaccuracies
Cisco was apparently very close to acquiring SentinelOne, but SentinelOne... "discovered a gap between the ARR it previously presented and the actual expected revenues. This discovery even led the company to change its ARR calculation method to reflect reality more accurately and also take into account scenarios of reduced usage of its solutions by customers."
Does this mean they were fudging the numbers a bit, got busted, and had to move to more honest calculations, or was it an honest mistake?
"Following the discovery, which required a retroactive revision of the financial statements and reduced $27 million from the company's ARR, Cisco withdrew from the negotiations, and SentinelOne returned to the market, but at a much lower value."
How much lower? Negotiations were reportedly in the $8-$9B range, but more realistically, would be looking at $6-7B after the ARR adjustment and subsequent 40% stock drop. On top of all this, SentinelOne laid off 5% of its workforce (~100 people). Following its IPO, SentinelOne traded as high as $20B, but now trades just under $5B.
"SentinelOne is currently working with the investment bank Catalyst Partners to find a new buyer, and Cisco could still return to the picture, this time at a reduced price."
- 10. ACQUISITION RUMORS: Palo Alto Networks in negotiations to acquire Talon Cyber Security in $600 million deal
Is it true? Who knows, but it seems a bit early for exit talks... unless the secure enterprise browser market isn't looking as hot as originally anticipated.
- 11. NEW COMPANIES: Illuminate Security
Somewhat unique results-based SIEM/XDR-like service. Worth checking out.
- 12. OPEN SOURCE TOOLS: Secure Controls Framework 2023.3 has been released
"The Secure Controls Framework (SCF) is a meta-framework (framework of frameworks) that maps to over 100 cybersecurity and privacy-related laws, regulations and industry frameworks."
- 13. INSIGHTS: Ignore The TOS Change – Get Me a Latte!
Last week, we talked about Mozilla's investigation into the insanity of automotive privacy policies. This week, we find out that tech company terms of service have similarly gone off the rails when it comes to hoovering up all our data for profit.
- 14. ESSAYS: “The Blob” Is Poisoning The Security Industry
- 15. ESSAYS: An Overview of Software Supply Chain Security
- 16. ESSAYS: 25 Hard-Hitting Lessons from 17 Years in Cybersecurity
- 17. DATA LEAK: 38TB of data accidentally exposed by Microsoft AI researchers
The latest in a long line of gaffes by Microsoft, this one is instructive and the details worth reviewing.
- 18. REPORTS: RSAC ESAF CISOs Transforming Third-Party Risk Management
- 19. HOT TAKE: Ops and Security Should Get Along by Nate Cash
