In a move that underscores the continued consolidation in the cybersecurity sector, enterprise security giant Check Point has announced its acquisition of Perimeter 81. The deal, valued at approximately $490 million, is on a “cash free, debt free” basis, according to a recent statement.
This acquisition comes at a time when startups, especially those seeking substantial growth funds, face fundraising challenges. Interestingly, Perimeter 81’s acquisition price is notably less than its previous valuation. The company secured $100 million in funding in June 2022, leading to a valuation of $1 billion, as per data from PitchBook. Among its key investors were Insight Partners, Maverick Ventures Israel, and Francisco Partners.
Although originally rooted in Israel, Check Point is now headquartered in San Carlos, California and boasts a market valuation exceeding $15 billion on public exchanges.
With over 3,000 global customers, the acquisition of Perimeter 81 serves a dual purpose for Check Point: eliminating a competitor while simultaneously enhancing its own portfolio of tools and potentially expanding its customer base.
Historically, Check Point has specialized in various domains of enterprise cybersecurity, from cloud services engagement to AI-driven network security and proactive threat identification. The company’s product suite for remote and hybrid workers will notably benefit from Perimeter 81’s strengths, especially in “security service edge” services, which ensures secure access for employees interfacing with company sites, data centers, cloud platforms, and the wider internet.
In the evolving work landscape, with companies like Zoom endorsing a blend of in-office and remote work, the demand for tools catering to such a workforce is on the rise. Current estimates suggest that while 12.7% of full-time U.S. employees have adopted a fully remote work model, a larger 28.2% have embraced the hybrid model. This dynamic presents a significant market niche for businesses developing solutions tailored to this segment of the workforce.
Check Point has disclosed plans to incorporate Perimeter 81 into its Infinity architecture, underscoring its strategy to offer unified security services spanning networks, cloud platforms, and remote user interactions.
This merger is emblematic of a broader trend in the enterprise tech sphere, where major platforms are integrating diverse functionalities to offer comprehensive solutions to clients. This not only unlocks additional revenue streams but also simplifies IT contract management for customers.
Highlighting the strategic rationale behind the acquisition, Gil Shwed, CEO at Check Point Software Technologies, commented, “The shifting landscape of hybrid work and increasing cloud adoption underscores the need for security solutions that extend beyond traditional boundaries. Integrating Perimeter 81’s capabilities with our Check Point Infinity platform aligns with our mission to provide premier, holistic, and collaborative security solutions.”
Echoing the sentiment, Amit Bareket, CEO at Perimeter 81, said, “Partnering with a seasoned cybersecurity leader like Check Point marks a pivotal moment for us. Our combined efforts will further our goal of offering a market-leading SASE platform. We are excited about the collective value we’ll bring to the security landscape.”
The transaction is set to be finalized in this year’s third quarter.
