Breaking News
0

Ex-Intel security chief says cyber firm ForeScout not ready for IPO just yet

TechnologySep 08, 2015 12:23PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Ex-Intel security chief says cyber firm ForeScout not ready for IPO just yet

By Tova Cohen

TEL AVIV (Reuters) - Fast-growing Israeli-U.S. cybersecurity firm ForeScout Technologies is set on listing on Wall Street, but may not be ready to launch an IPO in the next year, especially if financial markets remain volatile, its chief executive said.

Technology research firm Gartner ranks ForeScout as a market leader in the field of access control, which scans an organization remotely to detect every device connecting to its networks, while blocking out anything lacking appropriate credentials.

Its technology is in strong demand following recent high-profile data breaches at retailers, banks and media companies, and detection and response is the fastest-growing sector of the security business, according to Gartner.

That makes ForeScout confident it can maintain 50 percent annual revenue growth, seen over the past few years, for the next several years, Michael DeCesare, a security software veteran who took over as CEO in March, told Reuters.

But the Silicon Valley-based company, with research facilities in Israel, says it needs to raise more money and expand its business before its planned IPO on Wall Street. It has raised around $80 million from investors since its launch in 2000.

"I still have things I have to fix in our business and there is a somewhat tumultuous (financial) market environment ... Some things are a little more difficult to pin down," DeCesare said during a visit to Israel. "It's when we're ready. If the market falls sharply next year I don't want to go public."

In 2015, revenues are set to surpass $110 million, with billings from its 1,800 clients to top $140 million, he said.

    "We will be raising money to try and continue to fuel that growth. We have an IPO in the horizon but I'm not ready yet." He would not comment on the size of a future IPO.

DeCesare, who until last year was president of Intel's security division McAfee, said he plans to double the company's engineering staff in Israel to over 200 workers in the next 12-18 months and invest in sales and support staff. It employs another 300 workers in the United States and elsewhere.

    ForeScout's rivals include Cisco (O:CSCO) and HP's (N:HPQ) Aruba as well as Trustwave, which was acquired in May by Singtel (SI:STEL).

Gartner estimates that by 2020, 60 percent of information security budgets of companies worldwide will be allocated to breach detection and response — up from less than 10 percent in 2014.

    That will mark a big change for companies, which currently rely on older firewall technology to secure their networks, spending $32 billion on security products in 2014, according to IDC.

ForeScout's investors include UK-based Amadeus Capital Partners, its largest shareholder, Accel Partners, and Pitango Venture Capital, Israel's biggest venture fund.

Several Israeli security firms such as Cyber-Ark Software (O:CYBR) have gone public in recent years with successful offerings, following in the footsteps of computer security pioneer Check Point Software (O:CHKP), Israel's biggest tech firm.

    ForeScout, which works with other security providers, acts as the glue that connects together all the separate security investments companies have and are now making, said DeCesare.

Another former McAfee president, Dave DeWalt, now the CEO of breach-detection firm FireEye (O:FEYE), joined ForeScout's board in the past year, as did Enrique Salem, former CEO of Symantec (O:SYMC), another major cybersecurity player.

    Amadeus partner Richard Anton said the market for ForeScout's technology began to accelerate as smartphones became popular and more and more people started bringing their personal devices into work. So-called advanced persistent threats – cyber attacks by state-backed hackers – have further fanned demand, he said.

    "Once we saw the market opportunity was large enough we decided to build it into a substantial public company," he said of ForeScout.

(The story is refiled to fix typo in headline)

Ex-Intel security chief says cyber firm ForeScout not ready for IPO just yet
 

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email