A couple of weeks ago, TechCrunch broke the news that Akamai was in discussions to acquire Noname Security, a specialist in API security, for around $500 million. Today the deal is official, albeit at a lower price. Akamai has confirmed that it is buying the company in a $450 million deal.
The deal underscores the ongoing push for more consolidation in the current market: the last several years have seen the emergence a wide variety of cybersecurity startups. With a number of these companies finding it hard to scale, or raise money, or sell to customers that are looking for one-stop shops to manage multiple security needs, bigger players are picking up the smaller and more promising of these.
And sometimes that is at a steep discount. Noname, was most recently valued at $1 billion at its last private fundraise, so it is selling for less than half its valuation.
(This is not even the worst discount, though: Wiz was in advanced discussions to acquire Lacework Security for $168 million after last being valued at $8.3 billion. That deal fell through in due dilligence.)
Akamai will be integrating Noname into its API Security business, the company said.
“Applications run our world, but as applications and users proliferate, so do security risks,” said Mani Sundaram, EVP and general manager, Security Technology Group, Akamai Technologies, in a statement. “Akamai has seen a growing need for API protection with our own data showing 109% year over year growth in API attacks. With the addition of Noname, Akamai believes it will have the breadth of integrations and deployment choices needed to deliver comprehensive API protection for customers across all environments.”
Akamai’s focus, it said, is on providing more tools to developers and security operations teams to discover “shadow” APIs, as well as other vulnerabilities.
The deal is expected to close in the second quarter of 2024.
“API development continues to proliferate as customers prioritize their investments in application modernization and digital transformation initiatives,” said Oz Golan, chief executive officer and co-founder, Noname, in a statement. “Combining Noname with Akamai’s API Security offering will provide a solution for any type of customer. No matter where the customer’s applications reside – be it in the cloud, natively on the edge, on-premise, or on other vendor platforms – they will be protected.” Golan and the rest of the San Jose company’s 200 employees are expected to join Akamai with the deal.
