Cybertech5: Major Israeli Cybersecurity Exits in 2020

Despite the coronavirus pandemic the first half of 2020 saw some big exits for Israeli cybersecurity companies.

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The first half of 2020 has been marked by uncertainty amid the COVID-19 pandemic, as countries around the world have been hard hit by its effects.  Israel is no exception.  A recent report found that the ‘Startup Nation’ saw 52 exits with a total value of $5.82 billion in the first half of 2020, compared to 77 exits with a total value of $14.3 billion in the same time period in 2019.  

Despite the decline in the number of exits, 2020 has seen some of the largest Israeli cybersecurity exits.  Here we look at the top five:

1. Checkmarx acquired for $1.15 billion by Hellman & Friedman

Cybersecurity firm Checkmarx, a leader in software security solutions for DevOps, was acquired by global private equity firm Hellman & Friedman in April 2020 for $1.15 billion.  

TPG partnered with (H&F) and holds a minority interest in the company together with Insight Partners, which initially invested nearly $100 million in the company in 2015.

According to the companies' announcement, the deal represented the largest acquisition of an application security company to date.

Checkmarx was founded in 2006 by CEO Emmanuel Benzaquen and Maty Siman, founder and CTO and is a global leader in application security testing.  The company employs more than 700 employees, with about half of them in Israel, and has over 1,400 customers in 70 countries, including half of Fortune 50 companies.

2. Armis acquired by CapitalG and Insight Partners for $1.1 billion

IoT security firm Armis was acquired by global venture capital and private equity firm Insight Partners for $1.1 billion, with participation from CapitalG for $100 million in February 2020.

Armis was founded in 2015 by Yevgeny Dibrov, CEO, and Nadir Izrael, CTO, and is headquartered in Palo Alto, California with offices in Tel Aviv, Israel.  As part of the acquisition, Armis will continue to operate independently and will be fully managed by its two co-founders with the support of Insight's business strategy and scaleup division.

The cybersecurity company provides an agentless, enterprise-class security platform to address the new threat landscape of 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 discovers devices on and off the network, continuously analyzes endpoint behavior to identify risks and attacks, and protects critical information and systems by identifying suspicious or malicious devices and quarantining them.

3. Spot acquired by NetApp for $450 million

Cloud services company was acquired by cloud data services leader NetApp Inc. for $450 million in July 2020.

Spot was founded in 2015 by Amiram Shachar, CEO and Liarn Polak, Chief Architect and today has offices in San Francisco, New York, London and Tel Aviv.

Spot by NetApp delivers application-driven infrastructures (ADIs), cloud infrastructures that use analytics and machine learning to continuously adapt to the needs of applications, to help drive cloud resource optimization in real time, for both compute and storage.

ADIs help application teams shorten development lifecycles and run more applications in their choice of cloud. According to the company, this allows its customers to save up to 90% of their compute and storage infrastructure expenses, which typically account for 70% of total cloud spending.

4. Optimal Plus acquired by National Instruments for $365 million

National Instruments completed the acquisition of OptimalPlus, a data analytics software firm for the semiconductor, automotive and electronics industries for $365 million in July 2020.

The Holon based company was founded in 2005 by Dan Glotter, CEO and Nir Erez, who has since left the company and went on to found the popular transportation app Moovit, which was also acquired by Intel for $1 billion earlier this year.

The firm is among the pioneers of big data analytics for the semiconductor and electronics industries.

Through the acquisition of OptimalPlus, NI aims to help customers accelerate their digital transformation initiatives by coupling leadership in test operations with new advanced product analytics for enterprises. This in turn will enable organizations to connect test and measurement data from real world devices seamlessly throughout the product lifecycle – from product design to characterization and all the way to manufacturing – to help get technologies to market faster and lower the cost of test investments.

5. Cyber X acquired by Microsoft for $165 million

Cybersecurity company Cyber X was acquired by Microsoft for $165 million in June 2020.

CyberX was founded in 2013 by Omer Schneider, CEO and Nir Giller, GM and CTO and is based in Herzliya, Israel.  

The firm delivers an IoT/OT cybersecurity platform built by blue-team experts with a track record of defending critical national infrastructure.

Microsoft announced it will integrate the CyberX platform within its existing Azure IoT security capabilities, extending it to existing devices including those used in industrial IoT, Operational Technology and infrastructure scenarios.  The aim is to provide a simpler approach to unified security governance across both IT and industrial networks, as well as end-to-end security across managed and unmanaged IoT devices, enabling organizations to quickly detect and respond to advanced threats in converged networks.

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