Investment in cybersecurity strong as cyberthreats increase
Organized cyberthreats drive the trend of strong venture capital investments in cybersecurity.
Venture capitalist investments in cybersecurity firms have seen a 235 percent growth rate over the past five years as cyberthreats increase, but the trend may not last long.
Some of the underlying drivers for the success include international cyber conflicts and the growing skill levels of bad guys looking to steal sensitive network data, venture capitalists Venky Ganesan of Menlo Venture and Sean Cunningham of Trident Capital Cybersecurity told independent news site ThirdCertainty.
“It's the one area of investing that is not dependent on macro conditions because there are organized groups of hackers working every day to create demand for security products,” Ganesan said.
Despite the success, Ganesan warned the trend may be unsustainable because there are many people looking to invest in cybersecurity who don't have prior experience. He said that people will soon need to learn to evaluate which companies are actually worth their investments.