Tag Archive for Mergers and Acquisition

| February 18, 2020
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RSA Sold

RSA SoldThe rumor mill was again right. During the holidays I wrote about Dell Technologies selling its RSA cybersecurity business. The encryption pioneer is being purchased by private equity firm Symphony Technology Group Partners (STG). The STG consortium includes the Ontario Teachers’ Pension Plan Board and AlpInvest Partners.

private equity firmSTG is based in Palo Alto, CA, and was founded in 2002. According to its website, the VC firm focuses on data, software, and analytics. STG entered the cybersecurity arena in April 2019 when they bought RedSeal, a cyber risk modeling firm in a $70M deal.

RSA Sold for $2B

The deal is expected to close in the next six to nine months. Financial terms were not disclosed, but multiple sources peg the all-cash deal at $2.08 billion.

In a prepared statement about the deal, William Chisholm, managing partner at Symphony Technology Group, said:

We are excited and fully committed to maximizing the power of RSA’s talent, expertise, and tremendous growth potential and continuing RSA’s strategy to serve customers with a holistic approach to managing their digital risk.

Rohit Ghai, president of RSA wrote:

Symphony Technology Group … independent configuration, we expect to be in an even better position to accelerate innovation, ensure customer success with our portfolio…

Dell Technology’s chief operating officer and vice chairman Jeff Clarke wrote in the post announcing the deal:

The strategies of RSA and Dell Technologies have evolved … different go-to-market models. The sale of RSA gives us greater flexibility to focus on integrated innovation across Dell Technologies.

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CRN notes that the purchase price for the STG deal is nearly identical to the $2.1B EMC paid to buy RSA back in 2006. RSA then moved to Dell Technologies in 2016 when Dell purchased EMC for $60B. But why did Dell sell RSA?

  • Dell seems to be sinking a lot of money into Secureworks.
  • 2 billion dollarsDell’s VMware just bought CarbonBlack, why not RSA?
  • RSA was founded “way back in 1982.” And being a “legacy security firm” RAS may be seen at VMware as being part of VMware CEO Pat Gelsinger’s “Security is broken” talking point. Can companies face age discrimination too?
  • Maybe Dell just needs the cash.

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.

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| February 6, 2020
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VMware Had a Bad Week

VMware Had a Bad WeekVMware (VMW) had a bad week last week. First, a  jury in the U.S. federal district court for the District of Delaware ruled that the virtualization giant infringed on two patents owned by Densify. Densify is a Toronto-based startup that makes cloud and container resource management software. The ruling will cost VMware about $237 million dollars. Of course, VMware will appeal.

VMware logoIn an emailed statement, to sdxcentral VMware wrote, “VMware intend[s] to vigorously pursue all legal remedies that are available to us to prove that we are not liable here.”

Next, it was announced that over 200 VMware employees will lose their jobs as part of a “workforce rebalancing.” TargetTech noted that IBM has historically used the same term to describe its periodic layoffs.

In addition to workers losing their jobs, the VMware executive suite has undergone purging too. Reports are that

  • VMware Executative layoffsChief Customer Officer Scott Bajtos, an 11-year VMware veteran who oversaw VMware’s global services team which includes customer success, technical support, professional services support, and customer advocacy.
  • Mark Ritacco, VP of operations and customer intelligence, after almost 11 years,
  • Kate Woodcock, VP of customer advocacy, after almost eight years.
  • Scott Bajtos – global chief customer officer, is leaving after 11 years.
  • Alexa Erjavic, senior director of global services strategy.

VMware acquisitions

Could it be buyer’s regret? Not even cutting a handful of executive salaries can cover the billions VMware has spent on acquisitions over the past 2 years.

In 2018 VMware bought:

  • billions VMware has spent on acquisitionsE8 Security for machine learning (ML) and Artificial Intelligence (AI) for cybersecurity intelligence and analytics.
  • CloudCoreo to manage cloud configurations and identify risks when deploying public clouds to prevent breaches and compliance violations.
  • EMC Service Assurance Suite for monitoring telco network health, performance, and root cause analysis.
  • CloudHeath for multi-cloud management platform across Amazon Web Services (AWS), Microsoft Azure and Google Cloud Platform (GCP) for $500 million.
  • Heptio VMware plans to use Heptio assets to enhance Kubernetes life-cycle management $550 million.

In 2019 VMware bought:

  • VMwareacquisitions over the past 2 yearsAetherPal for remote IT support software to remotely view, control, troubleshoot, and fix devices and applications.
  • BitFusion to support Artificial Intelligence and machine learning-based workloads on graphics processor units (GPUs) (no acquisition price announced).
  • Uhana for 5G mobile network optimization.
  • Intrinsic for secure serverless functions on AWS, Azure, and GCP.
  • Bitnami brings simplified app development with a curated marketplace for VMware customers.
  • Veriflow for network monitoring software for multi-cloud management.
  • Avi Networks for multi-cloud application delivery to enhance performance, resource utilization, automation, and scalability.
  • Pivotal for multi-cloud application software strategy across AWS, Azure & GCP for $2.7 billion. and;
  • Carbon Black to provide an enterprise-grade security platform to protect workloads, applications and networks from device to cloud for $2.1 billion.

Already in 2020 VMware bought:

  • Nyansa to provide network traffic analytics that covers the SD-WAN and the wired and wireless LAN.

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While the hyper-scale cloud vendors AWS, Azure, GCP, and the Chinese giants battling it out for cloud supremacy. Most enterprises have adopted a multi-cloud strategy. VMware is in the incumbent position as it competes with IBM, maybe Cisco, and HPE to be the glue that binds private and public clouds as well as owned data centers into an enterprise multi-cloud strategy. This is a long-term play.

In the near term – all of the acquisitions since 2018, VMware does not have a lot to show for it financially. VWM has been basically flat. VMW spiked to $150.00 in January 2018, hit a peak of $203.64 in, 2019 and has settled back to $157.50 in February 2020.

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.

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| January 11, 2020
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Veeam Backup Bought

IVeeam Backup Boughtn a move to improve its U.S. market share, Veeam Software has agreed to be bought by private equity firm Insight Partners. The deal valued a $5 billion, is Insight’s second major acquisition of 2020. Veeam is cloud-focused data protection, backup, and disaster recovery software company.

Backup, and disaster recovery company.

Veeam logoVeeam was founded in 2006 and owned by Russians Andrei Baronov and Ratmir Timashev. The firm has grown to 365,000 customers worldwide and annual sales of more than $1 billion by capitalizing on the VMware-led server virtualization boom. As part of the take-over, the founders will leave the firm and Veeam will become a U.S. company based in New York. The company had been based in Baar, Switzerland.

Veeam’s products include backup solutions, cloud security offerings, and cloud data management. Veeam’s cloud data management portfolio consists of Veeam Backup for Amazon Web Services (AWS), Veeam Backup for Microsoft Office 365, Veeam Universal License (VUL), and Veeam Backup for Microsoft Azure.

Private equity plans

Veeam's products include backup solutionsThe private equity company has a three-stage program to help the companies in which it invests grow, including the Startup stage of focused on companies looking for early growth in their markets, the ScaleUp stage for companies with strong businesses, and the Corporate stage for companies ready for IPOs or other exits, Mike Triplett, a managing director of Insight Partners and new Veeam board member told CRN.

ZDNet says Veeam is in the second “ScaleUp” stage as customers are now also utilizing hybrid cloud setups with AWS, Azure, IBM, and Google, the firm’s “Act II” is to capitalize on a growing need for cloud data management across these environments. Mr. Triplett claims Insight Partners can bring the right resources to bear to move Veeam from the “ScaleUp” stage to the “Corporate” stage.

Other Insight Partners investments

Insight Partners has invested heavily in cybersecurity and MSP-friendly technology markets.Insight Partners also owns other data protection companies — including Unitrends and Spanning. In addition to data protection, the VC has invested heavily in cybersecurity and MSP-friendly technology markets. Other key Insight Partners investments include:

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private equity firms and hedge funds have a bad reputationExpect to see lots of PE activity this year (decade?). Channele2e reports that private equity investors are sitting on a record $1.5 trillion in cash. This kind of war chest is no wonder private equity firms and hedge funds have a bad reputation. VC firms have a history of acquiring businesses, loading them up with debt, and cutting staff to boost profits. The most recent examples being Sears and Toys R Us. Channele2e points out that U.S. presidential candidate Elizabeth Warren is calling for new private equity restraints to combat “legalized looting.”

I have seen that Veeam has a Russian problem. Back in the day when I shared technical services, I tried to replace an HP LTO2 tape library (PDF) with a Veeam solution and the powers-that-were did not want Veeam  – we spent a lot more money to maintain the old HP LTO2 technology.

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.

Category: Data protection | Tags: , , , , , , , , , , , ,
| November 30, 2019
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RSA Available?

Updated 12/26/2019 – The rumor mill says that Dell Technologies is working with too big to fail Morgan Stanley in a bid to sell off RSA Security.

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RSA Available?

Is RSA available? In keeping with the wave of cybersecurity mergers and acquisitions the rumor mill is reporting that Dell is exploring the sale of its RSA Security business unit. If the rumors are correct, RSA can be had for at least $1 billion. Rumors about Dell potentially selling RSA have surfaced multiple times over the past few years.

RSA Security logoDell inherited RSA in 2016 as part of its $67 billion acquisition of EMC. EMC bought RSA for about $2.1 billion in 2006. RSA Security was founded in 1982.

RSA is well-known for its products. Well known products include SecurID multifactor authentication tokens and NetWitness for security incident event management and threat detection and response. However, RSA is probably best known for its annual RSA Conference in San Francisco. RSA faces many of the same issues that have precipitated the HP – Xerox face-off. The challenges include competition from fast-growing cloud and software based identity and access management (IAM) firms.  The RSA challengers include Okta and Ping Identity, according to Bloomberg.

Why is RSA Available

RSA SecurID multifactor authentication tokensDell may have put RSA on the block because it is redundant in the Dell portfolio. Dell also owns Secureworks, an MSSP that’s evolved a software-defined era led by threat detection and management services. Additionally, Dell’s VMware business now owns Carbon Black — an endpoint protection and cybersecurity company that works closely with MSSPs. Dell has been connecting the dots between Secureworks, VMware, and Carbon Black as part of its own enterprise security strategy.

Neither Dell nor RSA commented on the Bloomberg report.

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As I have noted a number of times on Bach Seat, the cyber-security market is seeing lots of M&A action. If Dell is really serious about unloading RSA, now is the time to do it. Before the cyber-security bubble bursts and/or the economy tanks again. Not only would selling RSA streamline Dell’s security story the $1 billion would allow Dell to pay down its debt after its purchase of EMC or fund other projects.

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.

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| November 16, 2019
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Why Don’t Users Protect Themselves

Why Don't Users Protect ThemselvesA new report (PDF) from recently swallowed and swallowed again Webroot, says that American technology users overestimate their levels of cyber hygiene. Cyber hygiene is a cybersecurity risk mitigation technique introduced by Vinton Cerf in 2000 where you train yourself to think proactively about your cybersecurity. The goal is to resist cyber threats and online security issues to protect and maintain IT systems and devices and implement cybersecurity best practices, just as you do with your daily personal hygiene.

Webroot logoThe report says U.S. users do not know how to protect themselves from cyber threats. Americans are overconfident in the perceived protection they have. The endpoint security and threat intelligence provider found that 88% of interviewed Americans believe they are taking the appropriate steps to protect themselves from cyber-attacks.

Their confidence is misplaced. Instead, Americans have only a surface-level understanding of the most common types of cyber threats according to Webroot. We can recognize some of the names of the most common cyber-attacks such as malware (79%) or phishing (70%), but for most, that’s where their knowledge ends. Very few (less than 1 in 3) actually know what these common cyber-attacks are or what they do.

While Americans claim to have heard of some of the most common cyber-attack terms when prompted, very few actually understand what those cyber-attacks are. When asked about critical cyber-hygiene issues like malware, backups passwords, and identity theft surveyed Americans reported:

20% update their AV software regularlyMalware – 79% have heard of malware, but only 28% can confidently explain what it is. 82% are using some sort of AV software on their personal devices. 62% of those who use AV software use a free product. Only 20% update their AV software each time they are prompted.

Backups – are another weakness. 78% of respondents report backing up their data. However, 57% are still leaving themselves susceptible to risk by only backing up using one method, rather than backing up online (cloud) and offline.

  • 22% rarely or never backup their data.34% Automatically backup to the cloud
  • 27% Backup to an external hard drive
  • 24% Backup to a USB stick
  • 22$ backup locally on My Computer
  • 17% backup manually to the cloud
  • 22% rarely or never back up their data.

Among those who are backing up their information by uploading it to the cloud, only 43% are taking the extra step in ensuring that it’s stored in an encrypted format.

33% of Americans admit to sharing their passwordsPasswords – Followers of Bach Seat know that passwords suck and the Webroot report confirms it. 33% of Americans admit to sharing their passwords with others. To make matters worse, 63% are reusing passwords across multiple accounts. The research found that Americans have on average 9 passwords for 17 accounts.

Mobile – While on the go, 67% of Americans use public Wi-Fi, but only 35% take the extra step to protect themselves by using a VPN. Additionally, 34% use a work device as their primary personal device at home.

Identity theft 74% of Americans believe their identity stolen has never been stolen.

According to the Webroot whitepaper, the 5 most cyber risky U.S. states are:

  1. Mississippi most cyber risky stateMississippi
  2. Louisiana
  3. California
  4. Alaska
  5. Connecticut

The 5 least risky U.S. states are

  1. New Hampshire least cyber risky stateNew Hampshire
  2. North Dakota
  3. Ohio
  4. Idaho
  5. Kentucky

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According to the research conducted by Wakefield for Webroot, Michigan ranked 31 among the 50 states. Overall, the average home user scored a 60% for cyber-hygiene. The researchers also found that those who they classified as “Superstars” tended to be:

  • A Boomer
  • Married or in a relationship
  • Suburbanite
  • Not a parent.

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Ralph Bach has been in IT long enough to know better and has blogged from his Bach Seat about IT, careers, and anything else that catches his attention since 2005. You can follow him on LinkedIn, Facebook, and Twitter. Email the Bach Seat here.

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