💰 Security, Funded #196 - Cyber Dollar Dollar Bill Y'all

Security, Funded by Return on Security, is a weekly analysis of economic activity in the cybersecurity market. This week’s issue is brought to you by Tines, Dropzone AI, and Hyperproof.

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Table of Contents

• 😎 Vibe Check

• 💰 Market Summary

• 📸 YoY Snapshot

• ☎️ Earnings Reports

• 🧩 Funding By Product Category

• 🏢 Funding By Company

• 🌎 Funding By Country

• 🤝 Mergers & Acquisitions

• 📚 Great Reads

• 🧪 Labs

Private Markets

• 6 companies from 2 countries raised $54.2M across 6 unique product categories

• 100% of funding went to product-based cybersecurity companies

• 6 companies were acquired or had a merger event for $975.0M across 5 unique product categories

Public Markets

• 3 public cyber companies had an earnings report

Rolling 12-week charts that compare funding and acquisitions weekly in a year-over-year (YoY) view between 2024 and 2025.

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Earnings reports from last week: $OKTA ( ▲ 3.62% ), $S ( ▲ 1.64% ) , $ZS ( ▲ 0.85% )

Okta - $OKTA ( ▲ 3.62% ) 

Okta delivered a strong start to its 2026 fiscal year, focusing on large customer growth and new product contributions. Okta’s Auth0 platform and the new Identity Governance offering brought in $400 million alone. The company hit a new record profitability, with an operating margin of 26% and a free cash flow margin of 19%.

Despite the overall positive quarter, there were a few dark spots that made investors respond sharply. Okta saw a reduction in Net Revenue Retention (NRR), or the measure of how well they are retaining existing customers and expanding revenue from them, cited macroeconomic uncertainties and potential risks in the U.S. federal vertical, and muted its forward-looking guidance.

Combine this with increasing competition from the likes of CyberArk and SailPoint, and Okta’s stock has been down ~15% post-earnings call. 🥶 

SentinelOne - $S ( ▲ 1.64% )

SentinelOne delivered a solid first quarter, relatively speaking. Revenue climbed 23% to hit $229 million, powered by the “Singularity” platform, and ARR grew by 24% to $948 million. Sounds great if you look at these numbers only, but there’s more to the story.

SenitenlOne’s operating margin decreased 2% from last quarter, and that ARR number? It’s a higher number than last quarter, but it was a 21% reduction in growth from last quarter (ouch!). That downward ARR growth, combined with macro volatility, deal slippage (meaning potential customers pushed out buying decisions), and competing against CrowdSrike (which is 5x the size of SentinelOne), is a bad combo.

CrowdStrike aside, the rest are scenarios that many companies will experience as we live through these uncertain economic times. SentienlOne’s stock has been down ~10% post-earnings call as investors are not reassured of its ability to bounce back.

Zscaler - $ZS ( ▲ 0.85% ) 

Zscaler delivered a very strong earnings call this quarter. Revenue climbed 23% YoY to $678 million, driven by strong demand for its Zero Trust Exchange platform, and ARR grew by 23% YoY to $2.9 billion. However, Zscaler also acknowledged ongoing economic uncertainty affecting IT and cyber budgets. Cyber was still an easier sell than IT, but it noticed some pipeline drag.

Zscaler also highlighted its huge acquisition of Red Canary, a leading managed detection and response (MDR) platform, to further enhance its security operations capabilities. This was a huge move in creating new channels for sales and creating a more sticky experience for customers of both companies.

Zscaler’s stock has been up about 10% since the earnings call.

Earning reports to watch this coming week: $CRWD ( ▲ 1.31% ) 

• Everyday Americans Help North Korea Infiltrates U.S. Remote Jobs - A LinkedIn message drew a former waitress in Minnesota into a type of intricate scam involving illegal paychecks and stolen data.

• *The 2025 Summer GRC Report - Each year, Hyperproof’s report takes a deep dive into market trends in the GRC space. A new version just released that compares their data against reports from Accenture, BDO, PWC, and more so that security pros have the best data available.

• Security Is Just Engineering Tech Debt (And That's a Good Thing) - Breaking the Illusion That Security Is Anything But Software Quality.

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Security ROI > Coffee ROI

Data Methodology and Sources

• All of the data is captured point-in-time from publicly available sources.

• All financial figures are converted to U.S. dollars (USD) when collected.

• Company country locations are pulled from publicly available sources.

• Companies are categorized using the Return on Security system.

• Sometimes deal details, like who led the round, how much was raised, or the deal stage, may be updated after publication.

• Let us know if you spot any errors, and we’ll fix them.