Thematic Intelligence: Enterprise Security Software Sector Scorecard Q2 2024 Update

Thematic Intelligence: Enterprise Security Software Sector Scorecard Q2 2024 Update

Summary

Google’s parent company Alphabet’s interest in cybersecurity start-up Wiz may not have resulted in a deal, but it will spark new attention in M&A, beyond the continued buy-ups by private equity (PE) players. The usual narrative around M&A interest cites a need to acquire artificial intelligence (AI) capabilities, but Wiz is better known for its expertise in cloud security than AI. AI will indeed spur new M&A deals in cybersecurity, but if Alphabet was prepared to pay $23 billion for Wiz, then other cloud security companies, such as Lacework and Orca Security, are likely to come into play as targets for acquisition.

Key Highlights

• Regulators will increase their focus on cybersecurity M&A, especially deals involving PE firms. The last PE deal, Thoma Bravo’s purchase of Darktrace, barely stirred a regulatory muscle. Though a PE firm is not the acquirer of Wiz, it is the backer. Regulators have talked a good M&A game but have not backed it up. They will probably miss this opportunity too.
• Research from Check Point showed that, throughout 2023, organizations worldwide each experienced over 60,000 cyberattacks on average. That is around 1,158 attacks per company per week. In most cases, the route for the attack was the social engineering channel, which is why social engineering had a 15% weighting. There is now a clear case for making that weighting 20%. IT support desks were targeted in the 2023 attacks on MGM Resorts and Caesars Entertainment, reflecting how social engineering is the mechanism of choice for hackers. AI-inspired attacks are the future, but social engineering-and cloud-threats are very much the present.

• This sector scorecard provides a top-down, comprehensive outlook for the key players in the enterprise security software sector over the next two years, based on the key themes set to transform their industry landscape.

• Companies that invest in the right themes become success stories. Those that miss the important themes in their industry end up as failures.
• GlobalData’s thematic research ecosystem is a single, integrated global research platform that provides an easy-to-use framework for tracking all themes across all companies in all sectors. It has a proven track record of identifying the important themes early, enabling companies to make the right investments ahead of the competition, and secure that all-important competitive advantage.
• At GlobalData, we have developed a unique thematic methodology for ranking all major companies in all major sectors based on their relative strength in the big themes that are impacting their industries.
• Our thematic engine tags over 180 million data items across six alternative data sets-patents, jobs, deals, filings, social media, and news-to themes. The vast datasets within our thematic engine help our analysts to produce sector scorecards that identify the companies best placed to succeed in a future filled with multiple disruptive threats.