Photo by Glen Carrie / Unsplash

๐Ÿ“Š Cybersecurity Funding Review - January 2023

Cybersecurity Funding Review - A look back at what moved the cybersecurity market in January 2023.

Mike P
Mike P

Table of Contents

It's that time again.

Each month I do a recap on the business of cybersecurity funding and M&A news by the numbers, with visuals, and with my own commentary. I tweak these reports and add or remove sections and charts month-to-month based on feedback I get from readers like you. Let me know what I should start, stop, or continue.

This is the first monthly report for 2023.

I build these reports each month from some of the data I collect each week from the Security, Funded newsletter. If you're interested in poking through a different slice of the data, check out the Cybersecurity VC Database I made. It's the only open-source dataset like it!

If you're not signed up yet, make sure you get in on the best, most reliable, and most detailed resource for cybersecurity investing and M&A news on the Internet. Oh yeah, and it's free. ๐Ÿ‘‡

By the Numbers

A look at what moved the private cybersecurity market in January 2023 by the numbers.

  • Approximately $1.1B was invested in 52 cybersecurity companies across 30 unique product categories in January 2023, up from $890.8M in December 2022.
  • 26 companies across 16 unique product categories were acquired or had a merger event in January 2023. Managed Security Services Providers (MSSPs) and Professional Services continue to be the most acquired kinds of companies.
  • ~81% of funding went to United States-based companies with ~6.5% going Israel-based companies and 5.4% going to United Kingdom-based companies.

2023 Compared to 2022

Here's the link to the newsletter where I originally shared this image in case you missed it.

I also offered a few takes as to why I think the chart looks the way it does on LinkedIn. Check it out and let me know what you think (and let's connect if we're not already)! ๐Ÿ‘‡

Mike Privette on LinkedIn: #cybersecurity #security #software #startup #venturecapitalโ€ฆ
Capital is looking a lot more cautious so far this year in the cybersecurity space. For anyone who might have missed Monday's issue of Security, Funded, Iโ€ฆ

My Thoughts and Predictions

  • Buyers remain cash and resource-strapped through January and will last until at least Q2 2023.
  • As predicted, January 2023 was much more muted in terms of funding activity for high-dollar transactions. Expect a bit of easing up on that in February in terms of companies coming out of stealth mode.
  • February 2023 will be very telling for the cybersecurity industry. Most of the major public cybersecurity companies will be announcing their Q4 2022 earnings reports along with Q1 2023 forward-looking guidance and we will get a sense of just how resilient the large

Funding Events by Round Type

  • 17 Seed round events equal to $59.9M
  • 7 Venture Round round events equal to $107.0M
  • 6 Series B round events equal to $122.9M
  • 5 Pre-Seed round events equal to $2.2M
  • 5 Non-Equity Assistance round events equal to an undisclosed amount

Top 5 Funding Events

Top Funded Product Categories


  • $411.5M for Secure Access Service Edge (SASE)
  • $231.0M for Identity and Access Management (IAM)
  • $60.0M for Data Protection
  • $55.0M for Digital Forensics and Incident Response (DFIR)
  • $55.0M for Cybersecurity Education & Training

Top Lead Investor Teams

  • $401.0M for Morgan Stanley
  • $205.0M for AB Private Credit Investors
  • $60.0M for Digital Alpha
  • $55.0M for The Carlyle Group
  • $55.0M for Andreessen Horowitz

Top Funded Countries

  • $880.6M for United States
  • $71.0M for Israel
  • $59.9M for United Kingdom
  • $32.6M for France
  • $15.0M for Singapore

Top Acquired Product Categories

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 actually solving a cybersecurity problem
  • I personally assign the product category and write the description for each company (regardless of what the marketing says)
  • All monetary values are in U.S. dollars and currencies are converted, if needed, at the time of collection
  • All monetary values are from the time of collection

Wrapping Up

If you like a chart, statement, or prediction I made, let me know. If you want me to dig in further on something or see the data sliced in a different way, let me know.

It means a lot when you share these kinds of posts and subscribe to my newsletter!

Likewise, if you don't like something or if something doesn't make sense, let me know. I do this to contribute something new and add value to the industry so I want to make sure I'm also taking feedback.

See you again next month!


Mike P