Application Security (AppSec) Software Provider Veracode Valuation More Than Doubles Since 2018
This is technology M&A deal number 276 that MSSP Alert and sister site ChannelE2E have covered so far in 2022.
Veracode’s previous majority owner — private equity firm Thoma Bravo — will maintain a minority stake in the application security software company, all parties indicated. Quick math reveals that Veracode’s valuation has more than doubled since November 2018 — when Thoma Bravo acquired Veracode from Broadcom at a $950 million valuation.
Veracode develops application security testing software tools. Veracode’s 2,600 customers have scanned over 53 trillion lines of code and fixed more than 71 million security flaws, the company asserts.
On the partner front, Vericode in 2021 launched the Veracode Technology Alliance Program (TAP). The program is designed to make it “easier for organizations to implement, manage, and scale their software security programs, reducing friction and speeding up time-to-market. Early members include Accurics, Imperva, ServiceNow, and ThreadFix, among others.
Veracode Seeks Security Acquisitions
Veracode currently has roughly 725 employees. Looking ahead, Veracode plans to expand both organically and through acquisitions, CEO Sam King indicated in a prepared statement. The expansion effort will include new hires across engineering, product management, marketing, sales, and customer success. King said:
“What we do has never been more crucial. The confluence of digital transformation, software supply chain complexity, and the strengthening regulatory environment places software security firmly in the spotlight. We’re grateful for Thoma Bravo’s partnership over the last three years and look forward to our next chapter with TA. Together, we aim to accelerate our vision to deliver the most comprehensive software security platform that caters to the needs of both development teams and security teams by enabling them to build and deliver secure software at the speed that business demands.
We are committed to our mission, strategy, and product vision, and we are excited to partner with TA, leveraging its significant experience investing in enterprise software companies and track record in scaling growth businesses, to realize that vision. We plan to invest in the expansion of our product portfolio through organic development and strategic M&A, as well as accelerate the expansion of our global footprint and growth, while maintaining the healthy business fundamentals we have achieved over the last few years.”
Added Jason Werlin, a managing director at TA Associates:
“TA recognizes the strong market opportunity for Veracode, driven by the need to secure software and educate developers. We believe Veracode’s heritage and sustained leadership position, along with the breadth and depth of its portfolio, uniquely positions the company to drive the next wave of growth in the application security market. TA is excited to partner with the Veracode management team and Thoma Bravo on the next phase of the company’s journey.”
Noted Seth Boro, a managing partner at Thoma Bravo:
“Over the last three years, Veracode has expanded its platform, extended its market footprint, and established a clear track record of sustained innovation. In today’s digital world, cybersecurity solutions are more critical than ever before, and Veracode continues to drive innovation while helping solve customers’ most complicated security needs. We are very proud of what Veracode has achieved under our majority ownership and look forward to continuing to support Veracode as it enters its next phase of growth in partnership with TA.”
TA Associates: Private Equity and Security Experience
Private equity firm TA Associates is well-known across the software, security and MSP industries. The firm’s key investments and/or ownership stakes include:
- DigiCert for TLS/SSL, PKI, and IoT security solutions.
- Cybersecurity firm Netwrix.
- Data protection software providers ArcServe and StorageCraft, which merged in 2021.
- HelpSystems, which acquired MDR provider Alert Logic in March 2022.
TA Associates focuses on five industries – technology, healthcare, financial services, consumer and business services. Typical investments involve profitable, growing companies. The firm has has raised $47.5 billion in capital since its founding in 1968.