Insight Acquisition of Armis Marks Bellwether for Enterprise IoT Cybersecurity

Insight Acquisition of Armis Marks Bellwether for Enterprise IoT Cybersecurity

On January 6, 2020, NYC-based private equity firm Insight Partners acquired the Israeli IoT cybersecurity  firm Armis for an eye-popping $1.1 billion.

Armis is privately held, so it doesn’t publish revenue numbers, but estimates are on the order of $30 million annually–meaning this is not only a huge amount, but a stunning multiple. The company says it will continue to operate independently. It will focus, as it has since founding in 2015, on enterprise IoT cybersecurity.

Have the folks at Insight lost their minds?

No.

Enterprise IoT cybersecurity really is a big deal, and will be a bigger deal in future. Nemertes’ 2019-2020 research studies on IoT and cybersecurity highlight these areas as key for enterprise organizations. Fewer than half (47%) of enterprise cybersecurity teams have IoT specialists today–but 78% say they will have them by the end of 2020, a 66% increase.

And highly successful cybersecurity organizations (those at the 80th percentile or better in mean-total-time-to-contain, MTTC, operational metrics) are 56% more likely to have IoT specialists.

So Nemertes agrees with Insight’s billion-dollar bet on the enterprise IoT cybersecurity market. (Here’s a quick video if you’re interested in learning more.)

But there’s more.

One interesting fact that most writeups about the acquisition seem to be missing is this: Armis is one of a very few companies (Forescout, Ordr, CyberX) that isn’t vertical-industry specific. Why does that matter? Because it’s when a technology becomes part of a common infrastructure platform that it’s really poised to take off.

Think of TCP/IP in the 1980s and 199s: it wasn’t a “healthcare” networking technology or a “manufacturing” networking technology. It wasn’t even limited to a single use case within organizations: TCP/IP started life as a backoffice network, then moved to the front office, and eventually took over manufacturing and healthcare networks. (Fun fact: the first Internet-connected IoT device, a coke machine at CMU, was connected to the Internet in 1990).

My point is this: vertical-agnostic IoT cybersecurity is where it’s at.

Insight clearly understands that with the Armis acquisition. Stay tuned for more exciting developments (both technical and business) in this space!

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