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Venture capital sees cybersecurity as a source of opportunity


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BY : Diego GutiérrezMarch Wed, 2014

tic securityFrom 2009 to date the venture capital is $2.9B has been invested in Tics security and 26 rounds have been closed so far this year, raising a total of $150M. The need for security has increased early stage rounds. In the first four months of 2013, 16 seed capital companies raised $4.9 M.

Cybersecurity, a necessity

The increased use of new technologies in all sectors and activities has increased companies' concerns about security. For what is initially used to make everyday life easier can become a backlog. Last month, Apple revealed and corrected a massive bug in its operating system, which left user information exposed to theft; that is why booming investors, who years ago invested in new technologies, have now realised the need to invest in the security tics sector as well.

Leading companies

Investors distinguish between 3 types of security companies: data security, software security and network security.

Cloud Passage is an example of a security software company that is raising funds thanks to investors who see cybersecurity as an opportunity. From 2012 to date it has received 4 rounds of funding, the last one last February, in which it received $25.5M from Shasta Ventures, Meritech Capital Partners, Stephen Jluczo, Tenaya Capital, Benchmark and Musea Ventures.

Lastine, a platform founded in 2011 to detect, stop and manage security threats, is an example of network security. It has raised 3 rounds of funding, most recently $ 10M, with Redpoint Ventures and E. ventures.

On the other hand, Bluebox security launched its first product at the beginning of February, after having received a $18M round in January in which Andressen Harrowitz participated.

"In Spain there have also been successful operations in this sector, Blueliv received last February a €2.5M round from Telefonica, Kibo Ventures, and Roger Casals, with the aim of developing new products and strengthening its territorial expansion. Alien Vault closed its third financing round in September last year for €18M, in which Trident Capital, Kleiner Perkins Caufield & Byers, Sigma West and Adara Venture Partners, Top Tier Capital and Correlation Ventures participated as new investors," says Diego Gutierrez, corporate finance expert at Abra-Invest.

Leading investors in the sector

KPCB is the leading investor in ICT security, investing a total of $405M in 17 rounds, followed by Sequoia Capital and Andressen Horrowitz, which have participated in 11 deals since 2011. Accel and Intel have also bet on this sector, accumulating a total of 10 deals each.

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