Almost $10 billion was spent funding cybersecurity ventures in the first half of 2021, according to a new report published by Risk Insights Media and the Cyber Policy Institute. The report covered cybersecurity venture capital funding and merger and acquisition (M&A) deals over Q1 and Q2 of 2021.
Research into cybersecurity investment illustrates several important trends. Q2 spending was almost double Q1 spending, with $3.6 billion in Q1 and $6.1 billion in Q2. In H1 2021, $2.3 billion was raised by threat intelligence and threat detection and response. Cloud security and SaaS security raised $1.84 billion, and identity and access management raised $1.6 billion.
“The data reveals an industry in a high state of growth,” said Jeremy Davis, Principal at Risk Insights Media. “New paradigms like SASE, coupled with intensifying threats, appear to be spurring investment in new cyber defense capabilities.”
The report states, “Venture funding in cybersecurity saw a great deal of volume, both in the number of transactions and the impressive $9.5 billion put into the sector in the first half of the year. Venture investors see growth and strong potential for value in firms that can solve the most pressing cybersecurity problems companies face today and in the near future.”
According to Hugh Taylor, Director of the Cyber Policy Institute, “With the increased spending in cybersecurity, we can infer that stakeholders have determined their threat intelligence abilities are more limited than they want them to be. Indeed, numerous cyberattacks have increased the need for increased cybersecurity measures.”
The report further states, “M&A activity in network security (12.7% of deals), cloud security and SaaS (11.4%), and identity management (9.6%) suggest a deliberate move by the major players to compete aggressively in the emerging SASE market.”
The report concludes that the cybersecurity industry is growing, and many early-stage companies are poised to solve many of the problems facing businesses in today’s modern digital age. Major players are buying proven firms to broaden product and service offerings. As the need for increased cybersecurity grows, so will the cybersecurity industry.
The full report on cybersecurity venture and merger activity is available here.