CYBERSECURITY ALMANAC | 2023
We are pleased to provide you with Momentum Cyber’s Cybersecurity Almanac 2023 – the most comprehensive and accurate strategic data and insights available on the industry. Produced from analysis of over 3,500 Cybersecurity companies across the globe and strategic deal activity including IPOs, mergers and acquisitions (M&A), venture capital and private equity financings, and the market impact of news and events, the Cybersecurity Almanac chronicles the key trends which made 2022 a landmark year for the industry including $119.8B in M&A volume and $18.5B in PE & VC investments.
“We live at a seminal time in Cybersecurity history, with risk rising to levels greater than we have ever seen, while at the same time many businesses are unfortunately being forced to do more with less amidst a global economic slowdown,” said Dave DeWalt, Executive Chairman at Momentum Cyber. “While Cybersecurity venture investment slowed in the second half of the year, continued budget increases from security teams and ongoing Cybersecurity and geopolitical risk gives us optimism about the long-term future of this industry.”
The foreword of this year’s Almanac in collaboration with Team8 features insights and Cybersecurity predictions for 2023 from Nadav Zafrir, Co-Founder and Managing Partner of Team8, and Admiral Michael Rogers (Ret.), former Director of the NSA and Operating Partner at Team8.
- M&A Activity: 2022 saw sustained high activity in strategic acquisitions, with a total of 263 transactions for $119.8B in aggregate disclosed value. MSSPs and Security Consulting continue to lead industry deal counts, while Identity & Access Management experienced 71% YoY increase, the largest of any sector. Multiple mega acquisition deals drove funding to far exceed previous years in what otherwise would have been a down year for M&A. Mega deals and acquisitions of public companies accounted for $103.2B of the total M&A in 2022, including the landmark $69.2B acquisition of VMware by Broadcom. 13 total deals in 2022 were valued greater than $1B, including Thoma Bravo’s acquisition of SailPoint ($6.9B), Kaseya’s acquisition of Datto ($6.2B), OpenText’s acquisition of Micro Focus ($5.7B), Google’s acquisition of Mandiant ($5.3B), and Vista Equity’s acquisition of KnowBe4 ($4.3B).
- Financing Activity: VC financing in 2022 totaled $18.5B across 1,037 deals, which represented a 39% decline from the record-breaking $30.4B invested in 2021 but a 49% increase from the $12.4B spent in 2020. In total, 2022 represented the second most significant year of Cyber financing behind 2021. Top categories for VC investment included risk and compliance, Data Security, Identity & Access Management, and Network & Infrastructure security. Notable financing deals in 2022 included 1Password’s $620M Series C, SonarSource’s $412M Series PE Growth raise, Arctic Wolf’s $401M Convertible Notes raise, and BlueVoyant’s $250M Series D.
- Cybersecurity Services Evolve & Accelerate: Increasing demand for Cybersecurity services resulted in the sector becoming the most active sector for M&A in 2022 with 46 deals for MSSP companies alone (around 17% of all deals throughout the year by deal count). In total there have been 400+ transactions in Cybersecurity services since 2016 – 234 more transactions than identity and access management, the next highest sector during this period. Drivers of this M&A include the increased productization of professional services, a desire for strategic buyers to round out service offerings and increase market share, private equity rollups, and a market shift towards services enabled by and scaled with technology (making Cybersecurity services businesses appealing to investors and potential acquirers). For a more thorough analysis of the state of Cybersecurity services in 2022 and the impact of M&A in the sector, check out Momentum Cyber’s Evolution Of Cybersecurity Services special report.
- Momentum Cyber Advises Reciprocity On Its $60M Growth Financing From Francisco Partners
- Momentum Cyber Advises Apptega On Its Strategic Investment By Mainsail Partners
- Momentum Cyber Advises Infocyte On Its Acquisition By Datto
- Momentum Cyber Advises Fishtech Group On Its Merger With Herjavec Group
- Momentum Cyber Advises SecBI On Its Acquisition By LogPoint
- Momentum Cyber Advises RiskSense On Its Acquisition By Ivanti
- Momentum Cyber Advises Herjavec Group On Its Majority Acquisition By Apax Partners
- Momentum Cyber Advises Alcide On Its Acquisition By Rapid7
- Momentum Cyber Advises MistNet On Its Acquisition By LogRhythm
- Momentum Cyber Advises iboss On Its $145M Growth Financing Led By NightDragon & Francisco Partners
- Momentum Cyber Advises Goldman Sachs, ClearSky, and NightDragon On Their Acquisition of White Ops Cybersecurity
- Momentum Cyber Advises Goldman Sachs And ClearSky Security On Their Strategic Investment In White Ops
- Momentum Cyber Advises JASK on Its Acquisition by Sumo Logic
- Momentum Cyber to Support NTT’s Global Cybersecurity Strategy & Growth Initiatives
- Momentum Cyber Advises Interset on Its Acquisition by Micro Focus
- Momentum Cyber Served as Exclusive Financial and Strategic Advisor to RedLock
- Momentum Cyber Advises ADT and NightDragon on Their Strategic Investment in SAM Seamless Network
- Momentum Cyber Advises ADT on Its Acquisition of SDI
- Momentum Cyber Advises ICEBRG on Its Acquisition by Gigamon
- Momentum Cyber Advises Bradford Networks on Its Acquisition by Fortinet
- Momentum Cyber Advises Weblife on Its $60 Million Acquisition by Proofpoint
- Momentum Cyber Advises DATASHIELD on Its Acquisition by ADT
- Momentum Cyber Advises Cyphort on Its Acquisition by Juniper Networks
Momentum Cyber is the premier trusted advisor to the Cybersecurity industry providing bespoke high-impact advice combined with tailored, senior-level access. The firm was founded by world-class operators and advisors and caters to the unique needs of both earlier stage Founders, CEOs, & Boards as well as the complexity of later stage & public companies throughout their lifecycle. Headquartered in San Francisco with operations globally, the founding team has closed over 250 transactions totaling over $250 billion in value.