"insight" investment fund signed a deal to buy Cyber ​​Armis startup at a value of $ 1.1 billion

The Insight Investment Fund reported tonight that it has signed a deal to buy Cyber ​​Armis startup at a value of $ 1.1 billion. The deal is in cash, and is done in partnership with the CapitalG Foundation, which will pay $ 100 million of the amount. Some of Aramis' existing shareholders will continue to hold shares in the company. The deal is expected to close in February.
This is the largest cyber exit ever for an Israeli private company. In 2013, IBM bought Trestir for $ 800 million, and in 2019, Palo Alto Networks acquired Demisto for $ 560 million.
After the acquisition, Armis will continue to operate independently and will be managed by its founders. Aramis currently employs about 250 people, 130 of whom are in Israel.
Aramis was founded in December 2015, and has so far raised $ 112 million - of which $ 65 million was in April 2019 (so some of that fundraising may still be at the box office). Investors include: Red Dot, Bain Capital, Tenya Capital, Sequoia and Angel Capital Capital Nano. These all sold shares to Insight, which also invested in the company in previous rounds, which would be controlling Aramis. In addition to the funds, the company has a host of well-known Angel investors such as Zohar Zispal, Rakesh Lunker, Mickey Budai and Asaf Rappaport, the outgoing CEO of Microsoft Development Center in Israel.
Armis works in the field of Internet of Things (IoT) protection. The company was founded by Yevgeny Dibrov, who serves as CEO; and Nadir Izrael, who serves as VP of Technology. The third partner, Tomer Schwartz, left the company in 2017. Speaking from Adalum (sold to Microsoft for $ 320 million in 2015), Dibrow was the first employee of the company and its VP of business development.
This is an atypical private equity deal. Equity private equity funds typically acquire profitable companies with significant revenues to refine them and resell them. They do this through cash and debt - which should be paid off, at least in part, through the profits of the acquired company. Although Aramis is increasing its revenues quickly, it is estimated that it has not yet reached profitability.
According to Aramis, about 40% of the devices in the organization are now not classic computers, and therefore "hidden" for the network administrator and for the security products. In fact, the organization's security system is blind to them. The company claims that the number of devices connected to the network is growing at an annual rate of 31% per year, and that by 2020, the number will exceed the number of classic computers. According to Gartner Research, there will be 25 billion IoT standards in organizations by 2021. This is the challenge that Armis is trying to deal with.
The company has developed a solution that can map all devices in the organization and identify anomalies in their behavior. This is only a software solution that can interface with existing protection products and allows the security manager to monitor all devices in the company. Armis's solution is particularly relevant for industrial organizations that have network-connected machines; For retail chains that have connected funds; For health organizations that have medical devices connected to the network, and the like.
Protecting the Internet of Things is one of the big challenges in cyber. A typical organization has several tens to hundreds of devices - such as printers, webcams, smart TVs, and climate control systems - that are connected to the corporate network, but are difficult to protect and cannot be installed on antivirus or any other security product. Therefore, such devices have become a "front door" preferred by hackers and a major challenge for cyber security professionals.