The cybersecurity industry has gathered momentum over the last few years, especially as recent high-profile data breaches have refocused attention on security risks. We used CB Insights data to identify top corporate venture capital investors in cybersecurity startups, and tracked their investments and deals. Over the last 5 years, funding deals involving corporates have funneled almost $1.3B into the space, across 135 separate deals.
Corporate deals and dollars
After reaching a low in 2011, cybersecurity funding involving corporates climbed steadily. In 2014, corporates participated in 44 deals worth $502M, including a number of multi-million deals to CipherCloud, Centrify, and Skyhigh Networks. Both funding and dollars appear to be maintaining pace in Q1’15, and may not exceed 2014 numbers.
On a quarterly basis, deal flow has decreased quite a bit since a Q3’14 peak, but is was higher in Q2’15 than in the previous 3 quarters. Funding to cybersecurity with corporate involvement has been variable, though quarters from late 2013 to present have tended to see higher funding totals than in the past. It’s worth noting that after a Q2’14 peak of $248M, financing involving corporates has declined for three straight quarters.
Corporate financing breakdown by round
The distribution of the number of cybersecurity deals involving corporates by investment stage presents no clear trends. The relatively small number of corporate deals each year mean that the data is easily skewed toward one investment stage or another. It is noticeable that late-stage deals have been virtually nonexistent in 2014 and 2015 year-to-date.
Similarly, dollar share by investment stage has varied quite a bit as well. As might be expected, despite high deal share, early-stage rounds account for a relatively small dollar share.
Most active corporate investors
Tech giants dominated the ranks of the top corporate investors in cybersecurity. Intel Capital topped both our corporate investor and overall investor rankings. Google Ventures, next on the corporate investor list, was also one of the top 10 overall investors. Qualcomm Ventures is the third-ranked corporate player in cybersecurity financing. Notable recent deals involving Intel and Google include Intel’s participation in a $25M Series C funding for Vectra Networks in Q3’14 and Google Ventures’ involvement in a $9M Series A round for Checkr in Q4’14.
| Rank | Investor |
|---|---|
| 1 | Intel Capital |
| 2 | Google Ventures |
| 3 | Qualcomm Ventures |
| 3 | Juniper Networks |
| 4 | Salesforce Ventures |
| 4 | In-Q-Tel |
| 4 | Samsung Ventures |
| 4 | NTT DoCoMo Ventures |
| 4 | Citi Ventures |
| 4 | T-Venture |
Google, Intel, and Qualcomm also dominated among early-stage corporate investors in cybersecurity. Notably, all of Google Venture’s investments into cybersecurity were early stage, whereas only roughly a quarter of Intel Capital’s were.
| Rank | Early |
|---|---|
| 1 | Google Ventures |
| 2 | Intel Capital |
| 3 | Qualcomm Ventures |
| 4 | Comcast Ventures |
| 4 | NTT DoCoMo Ventures |
| 4 | Salesforce Ventures |
| 4 | Juniper Networks |
| 4 | T-Venture |
| 4 | Citi Ventures |
| 4 | Samsung Ventures |
Geography of corporate investments in cybersecurity
The vast majority of cybersecurity startup financings involving corporates took place in the United States. The majority went to first-place California (which saw more deals than the other top 5 states put together) followed by Massachusetts, and Colorado. See the chart below for the top five, and the number of deals:
