Cybersecurity money may not be flowing quite as easily anymore

Let’s follow the money today.

Axios looked at cybersecurity investment funds – and found the money here hasn’t dried up.    Some firms appear pretty eager to invest.

Quoting the piece:

Some cybersecurity sector investing has slowed, with the number of early-stage deals decreasing 21% between the third quarter last year and the same period this year, according to PitchBook data shared with Axios.

Four venture capitalists tell Axios their firms are still interested in both early- and late-stage security startups. However, some are shifting to specific product types or asking different financing questions to better protect their investments.

And, additionally another quote:

Investors still expect the bear market to catch up to the cybersecurity sector eventually and have been advising their companies accordingly. Several investors advise cyber startups to put an emphasis on cutting costs, hiring less and getting as close to breaking even as possible.

The same email newsletter has additional insights from corporate board rooms.    In a survey from August, board directors of large organizations were asked about their most significant threats.     41% of board members believe business email compromises are the biggest threat to their industry this year, followed by cloud compromise at 37% and ransomware at 32%.   

There’s an inclination by providers to load up on tools to address security.    Do not take the priorities listed by the board rooms as reason to load up on tools – and note that even the hot investors are starting to get a little hesitant on the supposed white hot security market.    The vendors telling you how hot it is being invested in it being hot.  Don’t forget that.

And take heed of that investor advice – they’re telling their companies to run smarter businesses and not lose money because money is more expensive and harder to find—another takeaway.