US private equity and venture capital firm Insight Partners is acquiring Israeli Internet of Things security company Armis at a valuation of $1.1 billion. Armis announced that under the terms of the agreement, Insight will acquire the company for cash with $100 million participation from Google's investment company CapitalG, while some of the existing shareholders will retain their stake.
Armis says that it will continue to operate independently and will be fully managed by cofounders CEO Yevgeny Dibrov and CTO Nadir Izrael, while receiving the backing of Insight's ScaleUp division. The deal is expected to close next month subject to customary conditions and approvals.
Armis was founded in 2015 by Yevgeny Dibrov, Nadir Izrael, and Tomer Schwartz (who is no longer with the company). Dibrov was the first employee to join cloud computing security company Adallom, which was eventually sold to Microsoft. Izrael led the technical team on Google's automatic completions engine Google Suggest. Among the investors in Armis are Bain Capital Ventures, Cerca Partners, Sequoia, Insight Partners, Michael Boodaei, Zohar Zisapel, and Google, which recently made an investment in the company. Armis has raised a total of $115 million.
Dibrov said, "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."
Izrael said, "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."
"Armis is the largest Israeli Cybersecurity acquisition of a private company ever and this is an important milestone in the Armis journey, building a substantial stand-alone Cybersecurity power-house," said Armis chairman Gili Raanan and general partner at Sequoia Israel and Cyberstarts.
Insight managing director Jeff Horing 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."
As part of the acquisition, Horing, Insight managing director Teddie Wardi, and Cyberstarts founder Gili Raanan will be serving on the Armis board.
Published by Globes, Israel business news - en.globes.co.il - on January 7, 2020
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