Sophos snaps up end-point security vendor Invincea for $100m
Acquisition will bolster Sophos' machine-learning technology, says CEO Kris Hagerman
Security vendor Sophos has acquired end-point security vendor Invincea for $100m (£80m) as it looks to bolster its machine-learning capabilities.
The acquisition sees Sophos take control of Invincea's commercial software products, while the Invincea Labs subsidiary of the business - which focuses on military-grade cyber protection - will remain with the current owners.
A further sum of up to $20m is payable based on billings growth in the first year of ownership.
Founded in 2009 and based in Virginia, Invincea develops next-generation end-point security technology and has a "strong presence" in government healthcare and financial services in the US.
The vendor has 100 employees and for the 12 months ending 31 March 2016 hit revenue of $13.4m, making a pre-tax loss of $11.8m.
Invincea announced a $10m funding round last November, taking its total funding to just under $50m. Investors include Dell Ventures, Aeris Capital and Grotech Ventures.
Sophos CEO Kris Hagerman said: "By adding Invincea to our portfolio, Sophos is executing on its vision to assemble the most powerful technologies to provide the very best, cutting-edge defences for our customers.
"Invincea is leading the market in machine learning-based threat detection with the combination of superior detection rates and minimal false positives.
"Invincea will strengthen Sophos' leading next-gen end-point protection with complementary predictive defences that we believe will become increasingly important to the future of end-point protection and allow us to take full advantage of this significant new growth opportunity."
Gartner Magic Quadrant
Invincea was recently named as a 'visionary' in the Gartner End-Point Security Magic Quadrant for the first time, alongside Cylance, Crowdstrike, Palo Alto Networks, SentinelOne and Carbon Black.
In the report, published before the Sophos acquisition, Gartner said that Invincea offers a unique product and flexible licensing, but requires investment to boost its presence outside North America.
"Invincea provides a unique hybrid solution consisting of next-generation machine learning and a behavioural monitoring anti-malware solution, with optional virtual container/application isolation support to minimise the risks of documents and files of unknown or questionable provenance," the report stated.
"Flexible licensing terms place end-points, servers, virtual environments and cloud protection on similar licences. Invincea's innovative ‘'test drive' programme provides a fully configured test environment for prospects to try the solution on their own, with supplied malware and bring-your-own-malware support.
"The company will need to invest heavily in developing international sales and support channels to become a viable competitor to existing incumbent end-point protection providers and organisations with global presence."
Sophos turns a profit
The announcement of the acquisition coincided with the release of Sophos' quarterly figures, with the security vendor reporting revenue of $134.8m for the three months ending 31 December 2016 - an 11 per cent increase on the same period in 2015.
A $1.7m operating profit was also reported, up from a $13.3m loss from the same period in 2015.
"We continue to see growing demand for our cloud-based security platform, Sophos Central, the adoption of which is increasingly a major driver of our subscription business," said Hagerman.
"There was also very strong customer uptake of Intercept X, our recently launched next-generation end-point product. We continue to see robust demand in our target markets and the strength of our financial model provides good visibility over future revenues, profitability and cashflows."
Highlights