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Each month I do a quick recap of cybersecurity funding and acquisition stats by the numbers with visuals.
This report is built off of the data I collect each week from the Security, Funded newsletter.
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At a Glance by the Numbers
A lookback at what moved the cybersecurity market in August 2022 by the numbers.
- Approximately $685.4M was invested in 53 cybersecurity companies across 28 unique product categories in August 2022, a significant drop from the $1.2B invested in July 2022.
- 45% of funding went to United States-based companies, a 15% drop from July 2022, with Israeli companies making up 19% of funding.
- 25 companies across 11 unique product categories accounted for $2.8B, a huge 2,116% increase from the $126.3M in July 2022.
- Professional Services companies were once again the most acquired category of company, followed by Managed Services Providers (MSPs), and Managed Security Services Providers (MSSPs).
- The Remote Browser Isolation category wins this month in terms of overall funding amount. I'm not sure what it is about this category and why each company in the field seem to get $100.0M investments out of the gate, but here we are. Island did this for their Series A ($100M) and Series B ($110M), so I imagine the decision process is something like this.
- Funding transactions overall slowed down in August as the general economy and the public markets felt the squeeze. As a result, more deals went private, meaning less public data was available on the transactions that did happen, and more deals went back to diligence for another pass.
- Even M&A deals saw a temporary slow down as compared to other months for the same general macro economic concerns.
- Managed Services Providers (MSPs) keep buying Managed Security Services Providers (MSSPs) as a matter of survival and market expansion. If you're not bringing a security capability to the table for your customers, you're going to get passed over.
- For all that was quiet in August, prepare for September 2022 to see even more of a rebound than July and previous months this year.
Here are some of my
wild guesses predictions
- Make funding rounds big again - with August's uncertainty out of the way, we're going to see some bigger checks dropping.
- MSPs and MSSPs will continue to consolidate and will focus more on increasing geographic reach instead of just customer acquisition.
- Data Security Posture Management (DSPM) companies will start making a splash in a big way as companies hone in on their messaging and squeeze out the legacy DLP market concepts.
- Category creators – companies that market themselves as a new type of product category and/or get analysts to use a new term for them – will have a harder time as we get closer to Q4.
No comparison is the thief of revenue - Me
Top Funded Product Categories
- $100.0M for Remote Browser Isolation
- $83.0M for Operational Technology (OT) Security
- $72.0M for Data Security Posture Management (DSPM)
- $67.9M for Identity Verification
- $57.5M for Privacy
Top Funded Industries
- $423.4M was not industry vertical specific
- $70.0M for Industrial Control Systems (ICS)
- $61.2M for Financial Services
- $48.7M for Web3
- $26.0M for Education
Top Lead Investor Teams
- $100.0M for Evolution Equity Partners
- $70.0M for TGVest Capital
- $61.2M for BlackRock
- $50.0M for C5 Capital
- $40.0M for WestBridge Capital
Top Countries Funded
- $305.5M for United States
- $129.5M for Israel
- $85.8M for Germany
- $70.0M for Taiwan
- $50.0M for United Kingdom
Data Collection Methodology
A few tenants I follow for collecting and creating this data:
- I only use public data sources
- I evaluate each company that makes this list to make sure they are solving a cybersecurity problem
- I personally assign the product category for each company (regardless of what their marketing says)
- All funding and acquisition values are in U.S. dollars and are converted at the time of collection
- All funding amounts are from the time of collection
See you again next time.
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A weekly recap of cybersecurity funding and M&A news.