Last year, cybersecurity funding deals reached a record high, with Q3’16 as the most active quarter for deals to cybersecurity companies in the last five years. However, that record quarter was then followed by a notable slow down in Q4’16, with only 76 deals, the fewest since Q3’13.
Last year also saw the emergence of a new cybersecurity unicorn. Cylance obtained a $100M Series D round in June that valued the company at $1B. In 2015 four cybersecurity unicorns emerged: Illumio, Okta, Tanium, and Zscaler.
Last year’s record deal activity shows that cybersecurity remains hot in the wake of persistent security attacks and hacks faced by business and government. Investors are still predominately making bets in early-stage cybersecurity companies (seed & Series A), an indication that in an evolving cyber-threat landscape, new solutions are still needed that can help mitigate, and perhaps even predict, attacks.