M&A Trends in Cybersecurity for 2024

In 2024, the landscape for mergers and acquisitions (M&A) in the tech sector presents a mixed scenario. While the number of deals has decreased, the value of these deals has significantly increased. Key drivers of M&A activity include the need to integrate AI capabilities into cybersecurity solutions, streamline tool sprawl, and stimulate revenue growth.
Experts attribute the M&A trends to a combination of macroeconomic factors and a strategic push for financial success in 2025. Big Tech companies are particularly keen on acquiring AI and data analytics expertise to enhance efficiency, decision-making, and customer offerings. This is further motivated by the desire to capture the faster-growing cybersecurity market and reduce operational costs amid staffing challenges.
Significant deals in 2024 include CyberArk’s $1.54 billion acquisition of Venafi and Akamai’s $450 million purchase of Noname Security. These large transactions highlight a trend where buyers are taking advantage of lower valuations to make strategic acquisitions, anticipating long-term gains.
Despite a reduction in the number of deals, M&A activity is expected to remain robust, driven by both venture capital (VC) and private equity (PE) firms. VCs focus on early-stage companies, while PEs target more mature businesses, both aiming for substantial returns. Consolidation is also a major theme, as companies aim to reduce the complexity and cost associated with managing multiple cybersecurity tools.
Overall, the market is adjusting from a period of rapid, speculative investment to one where only the strongest companies with solid fundamentals attract interest. This correction is seen as beneficial for investors, as it weeds out weaker players and focuses on sustainable growth. Expect continued M&A activity, especially in AI and cybersecurity, for the remainder of 2024 and into 2025.