KUALA LUMPUR (July 18): Venture funding to cybersecurity start-ups worldwide had its best quarter since the first quarter of 2022 (1Q2022), surging 144% year-on-year in 2Q2024, and seemingly building off a strong start to the year.
Cybersecurity is defined by the industries of network security, cloud security and cybersecurity.
In a report on Wednesday, Crunchbase, which tracks trends, investments and news of global companies from start-ups to the Fortune 1000, said that the increase in venture dollars was mainly due to a significant jump in nine-figure rounds — illustrating that even as investors may be pulling back on investing in young start-ups, they are willing to double down on more mature companies looking for growth rounds.
The firm said that in 2Q2024, cyber start-ups saw a robust US$4.4 billion (RM22.45 billion) invested in only 153 deals — the lowest deal count in years — according to Crunchbase data.
The dollar figure represents a 63% increase from 1Q2024, which saw US$2.7 billion roll to start-ups in 173 deals.
Crunchbase said the latest figure was a whopping 144% increase from 2Q2023, which saw only US$1.8 billion invested in cyber start-ups in 193 deals.
In the larger picture, the first half of the year (1H2024) saw US$7.1 billion in venture dollars go to cyber start-ups in 327 deals — a 51% jump from the US$4.7 billion invested in 1H2023 in 101 fewer deals.
Less deals, big deals
Crunchbase said that the drop in deal flows also may be an indication of what had changed to boost funding — mainly really, really big rounds.
It said the biggest in 2Q2024 was cloud security start-up Wiz’s announcement in May that it had raised US$1 billion at a US$12 billion valuation.
It said that this round is still the biggest in cybersecurity this year.
It is the largest cyber round since Securonix raised more than US$1 billion from Vista Equity Partners in February 2022.
Crunchbase said that in total, 1H2024 saw 19 rounds of US$100 million or more, while 1H2023 saw only a dozen.
It said that in fact, there were only 20 such rounds all of last year.