These 5 cybersecurity startups are on the verge of exit

December 9, 2016

The sustained growth of Big Data, fintech, IoT and more has exposed a host of new cybersecurity threats, and a flurry of startups have emerged as a result.

Venture investment in the space has increased for two straight quarters, climbing by $300 million and exceeding $1 billion in 3Q for the first time since 4Q 2015. While deal activity in the sector has recently declined, it’s in line with the global VC trend. In fact, the 15% slide in cybersecurity deals from 1Q to 3Q is considerably lower than the 21% decline for overall VC.

Although a load of venture capital has been invested in cybersecurity, a number of notable companies have remained quiet on the fundraising front. Below, we highlight the most valuable VC-backed cybersecurity startups that haven’t raised institutional funding in over two years. These are prime candidates to become the next cybersecurity exits.

Note: You can view the free profile of each company below to access funding, valuation and cap table data, as well as investors, executives and board members.

 

Time since last funding: 26 months
Last valuation: $539M

Veracode, which secures application code for web and mobile apps, last raised $40 million in September 2014 at a $539 million valuation. The company has been "IPO-bound" since that round and filed confidential S-1 documents with the SEC last March, even reportedly picking banks for the underwriting process. Veracode was expected to price its IPO last May but that still has yet to materialize.

 

Time since last funding: 29 months
Last valuation: $287M

ForgeRock, an identity relationship management vendor founded in 2010, raised an initial $7.3 million Series A round in March 2012. The company secured twice that amount about a year later through a Series B offering, then doubled the round amount again in its $30 million Series C about 14 months later. ForgeRock's valuation climbed 7.6x through the three rounds.

 

Time since last funding: 55 months
Last valuation: $269M

AnchorFree provides a VPN app that lets users securely and anonymously browse the web and change their location to access blocked content. The company raised an initial $6 million Series A at a $27 million valuation in 2006, a year in which the median cybersecurity Series A deal was $4 million and the median post-money valuation was $13 million. AnchorFree last raised a $52 million Series C led by Goldman Sachs in 2012—one of the five largest venture deals in the space that year.

 

Time since last funding: 31 months
Last valuation: $242M

Centrify secures enterprise identities against threats that target the hybrid cloud, mobile and on-premises IT environment. Founded in 2004, the company has raised about $94 million to date, most recently securing $42 million in Series E funding at a $242 million post-money valuation in May 2014. Centrify has now been private for nearly 13 years, likely leaving its earliest investors—which include Mayfield and Accel Partners—itching for an exit. In fact, just last week, Crossroads Capital announced it has sold its entire position of nearly 1.1 million shares of Centrify Series E stock for $3.2 million.

 

Time since last funding: 48 months
Last valuation: $191M

WhiteHat Security, a provider of website risk management solutions, has a long history of VC funding. The company closed its Series A in 2002, raising $250,000 at a valuation just north of $2 million. Its latest financing in 2012 valued the company at $191 million. That $31 million deal was led by a $26 million investment from growth equity firm JMI Equity. WhiteHat was reportedly "cash flow break even" by 2010.

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