Report: Global Cybersecurity Market Worth $75B in 2015

The rising specter of damaging data breaches have corporations scrambling to deploy IT security solutions, fueling market growth and M&A activity.

DENVER – The cybersecurity market reached approximately $75 billion globally in 2015, an increase of 4.7% year-over-year, according to a new study by Headwaters MB, an independent, middle-market investment banking firm based here.

Key segments included the U.S. financial services market at an estimated $9.5 billion in 2015. The U.S. federal government, which has spent $100 billion in the last decade, has budgeted $14 billion more for cybersecurity expenditures in 2016.


READ NEXT: Enterprises Grapple to Adopt Data Security Without Harming Other Business Initiatives


Last year proved to be an extraordinary year for the cybersecurity industry as M&A transactions, IPOs and venture financings reached new heights as governments and corporations fell victim to damaging and costly data breaches, according to the report. 

Titled “Cybersecurity: Finance Market Report,” the study claims:

The enormous magnitude of the information security problem leaves end users desperate for security solutions thereby driving robust demand for products and services. When a cybersecurity product or services company gains acceptance and sales traction in the marketplace, astronomical revenue growth rates and a high valuation in both dollars and as a multiple of revenues can result.

For example, in 2015 new investment firms such as Google Capital entered the sector, existing investors such as Allegis Capital increased fund sizes, and record sized financing rounds were completed for companies such as Tenable Network Security.

International finance activity remained brisk with, for example, the London Stock Exchange’s listing of the largest IPO for a cybersecurity firm in the United Kingdome and Microsoft’s acquisition of Israeli-based Adallom for $320 million.

Key conclusions from the report include:

  • Red hot cyber security transaction activity globally with more than 80 M&A transactions, 4 IPOs and 377+ growth capital financings in 2015
  • M&A valuations healthy with average valuation multiple for disclosed transactions of 3.0x revenue
  • Robust investor demand for IPOs with average valuations of 6.7x revenue and 36.1x EBITDA
  • Liquidity from M&A and IPO investor exits enticed venture capitalists to pour more than $2.3 billion into early stage financings
  • Post-IPO shares of publicly traded cybersecurity firms outperforming the broader market over the last 5 years
  • Plentiful growth opportunities going forward as the global cybersecurity market expected to grow to $170bn by 2020 representing a CAGR of 9.8%

To download a copy of the full report, click here.

If you enjoyed this article and want to receive more valuable industry content like this, click here to sign up for our FREE digital newsletters!

About the Author

Contact:

Although Bosch’s name is quite familiar to those in the security industry, his previous experience has been in daily newspaper journalism. Prior to joining SECURITY SALES & INTEGRATION in 2006, he spent 15 years with the Los Angeles Times, where he performed a wide assortment of editorial responsibilities, including feature and metro department assignments as well as content producing for latimes.com. Bosch is a graduate of California State University, Fresno with a degree in Mass Communication & Journalism. In 2007, he successfully completed the National Burglar and Fire Alarm Association’s National Training School coursework to become a Certified Level I Alarm Technician.

Security Is Our Business, Too

For professionals who recommend, buy and install all types of electronic security equipment, a free subscription to Security Sales & Integration is like having a consultant on call. You’ll find an ideal balance of technology and business coverage, with installation tips and techniques for products and updates on how to add sales to your bottom line.

A free subscription to the #1 resource for the residential and commercial security industry will prove to be invaluable. Subscribe today!

Subscribe Today!

Get Our Newsletters