May 25, 2022

Security companies usually start by focusing on a specific problem, but the largest ones, such as Palo Alto Networks, FireEye, and Symantec, have moved to a horizontal approach that gains functionality over time through acquisitions. SentinelOne, which went public last June, is on a similar course, and yesterday the company announced it was acquiring Ativo Networks for $616.5 million.

With Attivo, a company gains access to its own identity management, an approach that is becoming increasingly important as companies move to the cloud. The pandemic has certainly accelerated this approach and SentinelOne has had to cover this functionality. SentinelOne COO Nicholas Warner sees the acquisition as a natural addition to his company’s platform, especially in light of the need for greater security outside of the office environment.

“The transition to hybrid operation and the wider adoption of the cloud have established themselves as the new edge, highlighting the importance of understanding user behavior. “Individual Threat Detection and Response (ITDR) is the missing link in the overall Advanced Detection and Response (XDR) and Zero Trust strategy,” Warner said in a statement.

While this is security jargon, there is some truth to it. Companies need to be able to better track users on their systems looking for paranormal activity, and the acquisition really fills in that missing element in the SentinelOne platform.

Ativo Networks CEO Tushar Kotari sees the companies as a good partner and a way to develop the initial vision of a startup within a larger public company. “This acquisition is not an exit for Attivo. Exit naturally implies a change of direction or a delay. Joining forces with SentinelOne is the complete opposite – an opportunity to continue Ativo’s current path without slowing down,” Kothari wrote in a company blog post announcing the deal.

SentinelOne went public in June and raised $1.2 billion. Last year, she bought fast-logging company Scalar for $155 million. Launched in 2011, Attivo has since raised over $60 million. According to Crunchbase, the latest increase was a modest $11 million in 2019.

SentinelOne shares are up more than 14% today in early trading.

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