Palo Alto Networks, the California-based information security firm founded by Israeli Nir Zuk, announced on Tuesday that it is acquiring the Israeli startup firm Secdo, which has developed technology to investigate and deal with warnings of cyberattacks.
The purchase price for Secdo, which is based in the Tel Aviv suburb of Ra’anana, is between $90 and $100 million in cash. This is not Palo Alto’s first Israeli acquisition. It follows the purchase of Cyvera for $220 million and LightCyber for $120 million.
Prior to its acquisition, Secdo had raised $11 million, making the sale a particularly good proposition for its founders and initial investors. The firm’s initial investor was Marius Nacht, one of the founders of Check Point Software Technologies. Nacht has been a prominent investor in the Israeli startup scene.
Secdo was founded in 2015 by Shai Morag and Gil Barak, two veterans of the Israeli army intelligence corps technology unit, Unit 8200. They are now in their 30s. Morag is the company’s CEO and Barak its chief technology officer. The company has a staff of 65 at this point, 50 of whom work out of its Ra’anana offices and the remainder from the United States and Britain. As a result of the acquisition, it is expected that Secdo’s Israeli workforce will be integrated into Palo Alto Networks’ workforce and move to its offices in Tel Aviv.
The company’s technology is used by analysts engaged in manually investigating warnings of cyberattacks. Secdo is one of a number of companies that have developed products designed for this work, including Hexadite, an Israeli company that was sold to Microsoft for a similar sum. For his part, Morag, Secdo’s co-founder and CEO, said the combined capabilities of Secdo and Palo Alto Networks will enable the firms’ clients to identify and deal with cyberattacks with maximum speed and accuracy.
Among the investors in Secdo is RDC, the investment arm of Elron Electronic Industries and Rafael Advanced Defense Systems. RDC invested $5 million in Secdo and now will be receiving about $18 million on its investment. Other investors include Eyal Ofer’s firm O.G. Tech.