The deal calls for Insight Partners, with participation from CapitalG, formerly Google Capital, to acquire Armis in cash, giving the California-headquartered security firm the needed boost to beef up its market dominance.
Armis enables organisations, mostly Fortune 1000 companies, safely embrace unmanaged and IoT devices throughout their business.
Backed by big-ticket venture capital firms, such as Sequoia Capital, Bain Capital Ventures, and Red Dot Capital Partners, Armis said it eliminates the IoT security blind spot, letting enterprises instantly see and control devices and networks.
Armis, founded in 2015 by Nadir Izrael and Yevgeny Dibrov, will be turned over to Insight Partners in February, subject to customary conditions and approvals. Izrael and Dibrov will continue to operate the firm independently.
“We considered growth rounds and strategic offers, but by partnering with Insight we have the best of both worlds – operational support and independence, both of which were important in our decision to take on a scaleup partner this early in our company journey,” said Dibrov, co-founder and CEO at Armis.
The acquisition comes as research and advisory firm Gartner forecasts that there will be 25 billion connected devices by 2021. Up to 90 per cent of all devices will be unmanaged and unsecured, Armis said in a separate report.
“One of the biggest challenges keeping CIOs and CISOs up at night is how to secure the unmanaged devices proliferating through their businesses, from manufacturing floors to hospital rooms, from airports to boardrooms,” the IoT security startup said.
Since its inception, Armis raised over US$112 million in four funding rounds. It first raised an undisclosed amount in its Seed round, backed by Sequoia Capital Israel, and then another US$17 million in its Series A in 2017.
In 2018, Bain Capital Ventures and Red Dot Capital Partners co-anchored the firm’s US$30-million Series B funding round, which was followed by a US$65-million Series C in April 2019.
“Armis is the largest Israeli Cybersecurity acquisition of a private company ever and this is an important milestone in the Armis journey, building a substantial stand-alone Cybersecurity power-house,” said Gili Raanan Chairman of Armis and General Partner at Sequoia Israel and Cyberstarts.