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Security Market Update

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Update on the security market, including a detailed market share breakdown.

Publicado en: Tecnología
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Security Market Update

  1. 1. Security market update October 2017
  2. 2. Latest trends and drivers 2Source: Gartner, ITRC • Global cybersecurity spend continues to grow, forecasted to reach a total of $86B in 2017 (7% YoY growth) • An increasing number of CISOs are being mandated to report directly to CEOs and boards • Artificial intelligence and machine learning are enhancing SOC productivity, while also detecting breaches at an unprecedented rate • Demand for SOC expertise continues to outweigh supply • The number of security breaches has, again, hit record highs, with 791 data breaches logged in the US alone through 1H ’17 – a 29% increase over 2016 figures during the same time period • Politicians are calling for legal action against executives who allow their companies to be breached
  3. 3. $0 $5 $10 $15 $20 $25 $30 $35 0 20 40 60 80 100 120 140 160 180 200 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Medianpre-moneyvaluation($m) Dealcount Deal count Median pre-money valuation Early stage security forecasted to hit record highs 3Source: Pitchbook Note: 2017 data runs through Q3’17. Riding the tailwinds of the recent Equifax breach, deal count and valuations are expected to reach all-time highs in 2017.
  4. 4. 0.0x 2.0x 4.0x 6.0x 8.0x 10.0x 12.0x Q1'05 Q2'05 Q3'05 Q4'05 Q1'06 Q2'06 Q3'06 Q4'06 Q1'07 Q2'07 Q3'07 Q4'07 Q1'08 Q2'08 Q3'08 Q4'08 Q1'09 Q2'09 Q3'09 Q4'09 Q1'10 Q2'10 Q3'10 Q4'10 Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 EV/LTMrevenue Public EV / LTM revenue Public security multiples have remained strong… 4Source: Pitchbook Note: Public comps include CHKP, SYMC, PFPT, PANW and CYBR. After reaching a peak in Q1 ‘15, security multiples have settled around 8-9x LTM rev but may be in the early phases of another upward trend. 8.4x Median: 4.9x
  5. 5. $0.0 $10.0 $20.0 $30.0 $40.0 $50.0 0.0x 2.0x 4.0x 6.0x 8.0x 10.0x 12.0x Q1'05 Q2'05 Q3'05 Q4'05 Q1'06 Q2'06 Q3'06 Q4'06 Q1'07 Q2'07 Q3'07 Q4'07 Q1'08 Q2'08 Q3'08 Q4'08 Q1'09 Q2'09 Q3'09 Q4'09 Q1'10 Q2'10 Q3'10 Q4'10 Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Medianpre-moneyvaluation($m) EV/LTMrevenue Public EV / LTM revenue Median pre-money valuation …while private company valuations have also trended upwards though volatile 5Source: Pitchbook Note: Public comps include CHKP, SYMC, PFPT, PANW and CYBR. Private valuations are comprised of all Series A, Series B and Series C rounds. Private security valuations have followed trends in public multiples, albeit with a 6-month lag and in slightly erratic fashion.
  6. 6. Target Buyer Deal size Target Buyer Deal size $2.3B $300m $1.9B $293m $1.6B $275m $1.3B $145m $600m $125m $544m $100m $440m $100m M&A prices have trended downwards in 2017 as acquirers have shown earlier appetites 6Source: Pitchbook, press Note: 2017 data runs through Q3’17. Includes selected acquisitions >$100m in deal size. 2017 YTD notable transactions 2016 notable transactions Target Buyer Deal size Target Buyer Deal size $1.6B $240m Website Security $950m $230m $614m $225m $400m $185m $350m $130m $250m $120m $250m $100m
  7. 7. HPE CA IBM Rapid7 Synopsys Qualys WhiteHat Security Other Microsoft CA Oracle IBM Okta Ping Identity Centrify Other Symantec Check Point Palo Alto Networks McAfee Trend Micro Cisco Fortinet Kaspersky Sophos Other Symantec Forcepoint Cisco Zscaler McAfee Trend Micro Other Symantec McAfee Digital Guardian Forcepoint Fidelis Other Symantec Kaspersky McAfee Trend Micro AVG Other IBM Splunk HPE Dell EMC (RSA) Micro Focus Trustwave McAfee LogRhythm Other Proofpoint Cisco Symantec Microsoft McAfee Trend Micro Barracuda Mimecast Sophos Forcepoint Other Symantec and McAfee continue to diversify their product offerings 7Source: Company filings, EIKON, Gartner, Thomvest estimates SEGs SWGs SIEM Consumer EPPs / ENFs IAM Testing DLP Note: $6.2B of market share has been left out as ‘Other.’ $1.5B $2.0B $2.0B $4.6B $3.5B $2.6B $550m $800m $24B US security market in 2016.
  8. 8. Kareem Aly kareem@thomvest.com About Thomvest Ventures 8 Thomvest is an early- to late-stage venture capital firm with $300m under management. We primarily focus on opportunities in the US with startups in the fields of cybersecurity, advertising & marketing technology, and financial technology. The capital we invest is our own, enabling us to be more creative, flexible, and patient with our entrepreneurial partners. More than two-thirds of the companies we have funded in the last decade have either gone public, been acquired, or continue to grow as independent businesses. For questions or comments, please contact: Umesh Padval umesh@thomvest.com

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