Subscriber Bonus Post: Venture Spending in Cybersecurity Accelerated to $13.9 Billion for First Three Quarters of 2021
Total venture spending could reach $17 to $18 billion for the full year, almost triple 2020 levels. Free downloadable PDF containing detailed data on 809 deals available to Metacurity subscribers
Since its outset, the year 2021 has been a record-breaking year for the information security industry. A series of damaging cybersecurity incidents has tested the mettle of incident responders everywhere, unlike any other time since the digital era began. From the spyware infections in Microsoft Exchange servers to the ransomware shutdown of Colonial Pipeline to the supply chain ransomware attack on software company Kaseya, cybersecurity has become a high-profile topic for public and private sector decision-makers alike.
Although it’s hard to prove a connection between these crises and the sharp increase of funding to cybersecurity companies, however likely such a nexus might be, 2021 is also a record-breaking year for announced venture capital investment deals. Metacurity has been tracking in detail these deals since the first quarter of 2018, which was itself a hallmark year when VCs and other investors put $3.9 billion into firms that primarily focused on a variety of information security technologies and services.
According to our detailed tally, the $4.3 billion in venture capital invested during Q1 2021 alone surpassed the total $3.9 billion for all of 2018. Then, as the chart at the top of this post indicates, the $5.3 billion in venture funds that cybersecurity companies took in during Q2 2021 surpass any preceding quarter since we began tracking these deals.
Although the total deal volume dipped to around $4.2 billion in Q3 2021, total venture spending for the first three quarters of the year, according to our tracking,1 total venture investment in cybersecurity, reached $13.9 billion, more than double the $6.2 billion for all of 2020. If investments continue at this pace, cybersecurity is on track for a $17 to $18 billion venture investment tally for 2021, almost triple 2020 levels and nearly double the previous annual record of $9.8 billion in 2019.
And although some of the increase stems from some monster investment deals, such as the $543 million Series A round for Transmit Security announced on June 22, much of the growth is attributed to a spike in the number of deals. As the chart above shows, the number of deals rose to 71 during Q1 21 and then skyrocketed to 93 during Q2 21 before dipping back to 73 in Q321.
The growth in the number of cybersecurity venture deals kept average deal size in the $58 million to $61 million range for the first three quarters despite the big-ticket funding rounds, as the chart below illustrates.
As a benefit to all Metacurity subscribers, both free email subscribers and premium subscribers, we offer a downloadable PDF of the 809 venture deals in our database, dating back to January 2018. (Please note that the link for this database goes to our corporate website, DCT Associates because Substack doesn’t yet allow authors to post PDF downloads.)
As the image above illustrates, this PDF offers rich details about each funding event, including the deal date, company name, company focus, company category, deal amount, type of funding round, and every investor in the round.
Click on the button above and then click on the button that says download. Then enter the email address you used to sign up for Metacurity. Once we’ve verified that you’re a subscriber, we will send you the download link using that same email address. (Be sure to check your spam filters). Once you download the PDF, we recommend adjusting the view size to 150% to better see the data. We plan to develop an easy-to-use searchable database, as well as other unique analyses, for our premium subscribers.
Let us know any thoughts you might have by emailing us at info@metacurity.com. Happy reading!
