SonicWall CEO on McAfee IPO rumours and Symantec's possible sale
Bill Conner discusses the mooted ownership changes of two giant security vendors
Vendors in the cybersecurity market will continue to be the subjects of ownership changes as businesses scramble for talent and intellectual property, according to SonicWall CEO Bill Conner.
Conner was speaking as rumours of a Broadcom's possible takeover of Symantec continue to swirl, while McAfee is reportedly eyeing up an IPO.
CrowdStrike, meanwhile, recently exceeded analyst expectations when its valuation soared after going public.
"I think security is hot," Conner said. "There's a lot of money at play. And look at the data: the threat landscape is getting very, very real.
"So there's a lot of sponsors in terms of private equity (PE) rolling up our own company and other PE companies are buying security because it's increasingly becoming a mainstay in terms of importance.
"Likewise, some like Broadcom and others are saying ‘Oh my gosh, we've got to build this in either our apps, our hardware, or our business'.
"The thing is, the people, intellectual property and capabilities in security are in short supply. So people are looking to control that destiny because you can't hire it out. So to scale it, in a lot of cases, you need to buy it."
On McAfee, he added: "McAfee is the latest example of change in the market: they were private, they went public, they got bought up strategically, they went private, and now they're going to IPO.
"So, IPOs now are the whole way to monetise yourself if you've got a stable business.
"The question is whether it will consummate as a true IPO, or whether they'll get bought at the last minute by private equity. That's a financial play that's playing out, because to maximise the value they get, a lot of PEs don't want to buy right now because security is becoming a premium in the market.
"So some do make it public, and some get bought at the last moment."
A direct touch
Partners may be used to some wariness - and even exasperation - at vendors whose direct business runs up against partners trying to win contracts from end users.
Yet, for the CEO of Dell's former subsidiary, SonicWall, having a direct touch is not actually about competing with partners; it's about doing some of the initial pitch legwork.
"We are building out our direct touch resources," Bill Conner told CPI.
" Sometimes when you are talking to governments and enterprises, they want to talk to the manufacturer about your product roadmap.
"I hear governments saying, 'I want to have different service mechanisms as an enterprise or government customer than a traditional SMB SonicWall customer'.
"…And especially with our threat data on what's going on in the world; that's our data, that's my capability. So we'll talk to governments - me personally, in some cases - and then as that conversation matures, we'll work with partners of theirs or our existing partners and pass that opportunity on."
From zero to 18,700
Since Dell divested SonicWall by selling up to PE firms Francisco Partners and Elliott Management in 2016, Conner says it has built its partner base from zero to 18,700.
He said that as the vendor is increasingly turning its eye to the public sector and enterprise customers, some of its partners are specialising to match that focus.
"In a lot of cases governments are different channels from our traditional channels, but some of our partners - be they system integrators or other specialty partners - know we're building out now for enterprise and government, and are coming with us."
Conner reiterated that while SonicWall salespeople may initiate contact with a new customer solely or with a partner, in all cases, a won contract is passed back to a partner to manage.
"We're building our direct touch, but people should know we are always going to be 100 per cent channel," he said.
"We have to work with our existing channels and in these new channels, to move up the market, because we're currently number five in the enterprise space."