Managed Services, Threat Management

M&A volume in cybersecurity surges, topping $39 billion in first half of 2021

Momentum Cyber Founders: Michael Tedesco, Dave DeWalt, and Eric McAlpine. (BusinessWire)

The increased threat landscape, attacks on critical infrastructure, and attention by the Biden administration has resulted in an ever growing interest in cybersecurity.

And investors have noticed.

A report released by Momentum Cyber found that there was $39.5 billion total M&A volume in cybersecurity in the first half of 2021 alone – up from $9.8 billion in the first half of 2020.

Funding has been strong in the cybersecurity market, with $11.5 billion in total venture capital financing in the first half of 2021, more than double from $4.7 billion in the first half of 2020. Of the 430 total transactions, 36 were greater than $100 million.

Top categories for financing and M&A included: security consulting/MSSP, risk and compliance, cloud security, data security, and threat intel/incident response.

The stock market has also noticed, as cybersecurity stocks increased 16.8% during the first half of 2021, outperforming the NASDAQ at 12.7%, and the S&P at 15.2%

Dave DeWalt, founder and CEO of venture capital firm NightDragon Security and founder and executive chairman of Momentum Cyber, told SC Media during an interview at Black Hat earlier this month that companies looking to do deals need to understand that there are different entities, different investors, that help companies with different stages of life.

DeWalt told startups to “know your window” – that period of time when a startup owns an idea with merit. “If you can execute in that window, you win,” he said. “If you can’t execute, you lose.”

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