Private equity firm Insight Partners, parent of Kaseya, has acquired Armis, an enterprise IoT (Internet of Things) security startup, for $1.1 billion, the companies have disclosed. The deal, touted as the largest acquisition ever of a privately held Israeli cybersecurity company, is expected to be finalized in February 2020.
Armis develops an agentless, enterprise security platform for managed, unmanaged and IoT devices — from traditional devices like laptops and smartphones to new unmanaged smart devices like smart TVs, webcams, printers, HVAC systems, industrial control systems, medical devices and more.
Armis “grew significantly “in 2018 and continued its “tremendous growth” in its current fiscal year across all verticals, the company asserts. Key adopters include Allergan, Mondelēz, Oracle and Sysco Foods, among others. Still, the company did not disclose actual revenue or profit figures.
Armis raised $65 million in Series C funding back in April 2019, bringing the company’s total funding to $112 million. The round was led by Sequoia Capital, with Insight Partners and Intermountain Ventures joining, among others involved. Key focus areas at the time included the Internet of Medical Things (IoMT), encompassing medical devices like connected infusion pumps, MRI machines, X-Ray machines, smart beds, and patient monitors.
Armis will operate independently — led by co-founders CEO Yevgeny Dibrov and CTO Nadir Izrael, and executive team.
“Insight is one of the most sophisticated software investors in the sector, and it is due to the depth of their domain expertise that they really understand the enterprise IoT device challenge we are looking to solve, and the size of the market opportunity. We considered growth rounds and strategic offers, but by partnering with Insight we have the best of both worlds – operational support and independence, both of which were important in our decision to take on a scaleup partner this early in our company journey. We are thankful for the support we received from our investors at Sequoia, Tenaya, Bain, and Red Dot; and we, as well as the whole Armis team, are very excited to have Insight working alongside us as we enter this next phase, accelerating our platform and growth.”
Armis co-founders Yevgeny Dibrov and Nadir Izrael
“One of the biggest challenges keeping CIOs and CISOs up at night is how to secure the unmanaged devices proliferating through their businesses, from manufacturing floors to hospital rooms, from airports to boardrooms. These devices – capturing and creating business critical information, working on production lines, or administering patient care – have no protection and they need a security solution. The exponential growth of Armis to date illustrates just how critical securing unmanaged devices is for businesses. With the backing of Insight, we will continue to expand our world class technology to help identify devices, track their behavior and respond to the threats that target them.”
Insight Partners’ leaders also lined up to praise Armis. In a prepared statement, Jeff Horing, managing director at Insight, said:
“Armis is one of the most ground-breaking enterprise data-centric security solutions that is actively protecting modern businesses today. Having achieved exponential growth to date, we are proud to be the partner Armis can leverage to help execute their vision of protecting unmanaged devices proliferating every vertical around the world. We see the huge problem they are solving, Armis has established themselves as the leader in the enterprise IoT security space, and we believe this team and their technology will continue to transform the way unmanaged devices are secured.”
Teddie Wardi, managing director at Insight, added:
“The strength of Israeli security software is unquestionable, and we are thrilled to be the scaleup partner Armis has selected to continue their explosive growth journey. We’ve spoken with their users who have told us how powerful the Armis platform is at device discovery, classification, and continuous threat assessment. In a world of unmanaged devices, Armis’ technology is a game changer.”
Armis Acquired: Who Is Insight Partners?
Insight Partners has emerged as a private equity powerhouse in the cybersecurity and MSP-friendly technology markets. Key investments and ownership stakes include:
Kaseya (IT management)
Aqua (container security)
Darktrace (network security)
Detectify (vulnerability scanning)
KeyFactor (digital identity management)
OneTrust (privacy management)
Recorded Future (threat intelligence)
Resolve (incident response)
SentinelOne (endpoint security)
Sysdig (container monitoring)
Tenable (vulnerability scanning)
Tigera (zero trust container management)
Thycotic (privileged access management)
Vailmail (email security)
Although cybersecurity company valuations are sky-high, more M&A deals and private equity investments are a safe bet. Indeed, private equity investors are sitting on a record $1.5 trillion in cash, according to new data from Preqin. Yes, that’s trillion — with a T. That is the highest on record and more than double what it was five years ago, CNBC reports. Amid that reality, private equity firms are scrambling to make investments.