Investors flock to cyber security start-ups

[InfoSec News <alerts () infosecnews org>]

http://www.ft.com/cms/s/0/f5c87808-a883-11e3-b50f-00144feab7de.html

By Hannah Kuchler in San Francisco
FT.com
March 12, 2014

Cyber security start-ups have become the latest fascination for Silicon 
Valley investors, who have flooded the sector with venture capital 
investment as they seek to back the latest technology to combat criminals 
online.

Early-stage funding for the sector soared by almost 60 per cent last year 
to $244m worldwide, according to data from research group PrivCo. The 
number of deals rose even faster, up more than 100 per cent year-on-year 
to more than one a week. The figures imply multibillion-dollar valuations 
in total for these young companies, which often only have a small number 
of employees.

The investment boom in cyber security companies comes as cyber crime is on 
the rise and recent high-profile attacks, such as the data breach at US 
retailer Target and the theft of customer details at Adobe, the software 
company, have highlighted the extent of the threat.

Ted Schlein, a partner at Kleiner Perkins Caufield Byers, the Silicon 
Valley venture capital firm, says there has been a "huge mental shift" in 
companies and they are increasingly willing to spend on cyber security.

[...]



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