Fortinet completes acquisition of former cloud security unicorn Lacework
The cybersecurity vendor is looking to extend its SASE platform with the acquisition of ‘trailblazer’ Lacework, Fortinet says.
Fortinet is looking to significantly extend its cybersecurity platform with the completion of the acquisition Friday of cloud security "trailblazer" Lacework, the company said.
Terms of the agreement, which was initially announced June 10, have remained undisclosed.
An estimate released in June by Forrester analysts pegged the Lacework acquisition deal at between $200m and $230m. CRN has reached out to Fortinet for comment.
That would constitute a fraction of the $1.8bn in funding Lacework had raised since its founding in 2015. For several years, Lacework had ranked among the top-valued cybersecurity unicorns, with a valuation of $8.3 billion achieved in 2021.
Lacework was also notable for being the third company to launch out of private equity firm Sutter Hill Ventures, following an incubation model that had earlier produced Pure Storage and Snowflake.
Indications of Lacework's struggles surfaced as far back as May 2022, when the company laid off 20 per cent of its staff just months after raising a $1.3bn funding round. Several months before the layoffs, Lacework had disclosed having more than 1,000 employees.
The Forrester estimate suggested that Lacework's annual recurring revenue (ARR) had likely ranged from between $70m and $90m. That is well below cloud security rival Wiz, which earlier this year disclosed achieving $350m in ARR — and reportedly has now reached ARR of $500m.
For Fortinet, the Lacework deal will "provide an updated end-to-end (albeit fragmented) portfolio of multicloud-capable cloud and application security solutions to its customers," the Forrester analysts wrote in their June post.
Fortinet said in its news release Friday that it will see significant expansion of its capabilities through the acquisition of "cloud security and cloud-native application protection platform (CNAPP) trailblazer" Lacework.
The combination of the two companies "will result in the most comprehensive, full-stack AI-driven cloud security platform available from a single vendor," Fortinet CEO Ken Xie said in the news release.
The deal includes Lacework's "advanced" technology, bolstered by 225 patents and patent applications, many of which are tied to cloud security and AI, according to Fortinet.
Fortinet previously emphasised its opportunity to integrate capabilities from Lacework's CNAPP into its Unified SASE (secure access service edge) offering.
Lacework has focused on offering a data-powered cloud security platform that collects and analyses data from across cloud environments and supplies customers with key insights, such as around threat prioritisation.
Former Lacework CEO Jay Parikh is not mentioned in the news release Friday announcing the completion of the acquisition. Parikh's LinkedIn profile indicates that his time at Lacework ended in July and does not mention Fortinet. CRN has also inquired about Parikh with Fortinet.
Parikh had previously been Facebook's vice president of engineering prior to joining Lacework in 2021.