Cisco Systems is acquiring Duo Security, a multi-factor authentication (MFA) and zero-trust security platform provider, for $2.35 billion. The acquisition likely will have far-flung effects on Cisco, Duo and each company's respective customers, along with the global managed security services market.
To better understand the Duo transaction's potential impact, let's take a look at 10 things you need to know about the deal.
1. Product Integrations: Duo's identity awareness capabilities will be integrated into Cisco's Secure Internet Gateway, Cloud Access Security Broker (CASB), Enterprise Mobility Management (EMM) and other cloud-based products.
2. Visibility: Duo will provide Cisco customers with visibility into their mobile, managed and unmanaged devices, trusted access to their critical applications and insights into trusted and untrusted endpoints.
3. Application Access Control: Cisco will integrate Duo's software-as-a-service (SaaS) model into its Identity Services Engine (ISE) network access control product. By doing so, Cisco customers will be able to use ISE for cloud-based application access control.
4. Secure Application & Device Access: The combination of Cisco's network, device and cloud security platforms with Duo's zero-trust authentication and access products will enable Cisco customers to securely connect their end users to any application, on any networked device.
5. Channel Partner Momentum: Duo's channel business grew 600 percent in the past year.
6. Expanded Reach: Duo recently opened new offices in Austin, Texas and San Mateo, California. It also has tripled its staff and quadrupled its number of paying customers in EMEA over the past two years.
7. Funding: Duo added $70 million in Series D financing at an over $1 billion valuation and surpassed $100 million in annual recurring revenue last year.
8. More Momentum: Duo has projected "continued rapid growth" in 2018, CEO Doug Song said earlier this year
9. Customer Footprint: Duo serves more than 10,000 customers across 100 countries, manages more than 300 million authentication events every month and provides security insights into more than 8 million devices.
10. Market Opportunity: Duo could help Cisco capitalize on a global MFA market that is expected to grow. In fact, this sector is projected to expand at a compound annual growth rate (CAGR) of nearly 19 percent between 2015 and 2022, industry analyst OrbisResearch noted.
The Duo acquisition is expected to close during the first quarter of Cisco's fiscal year 2019, according to a prepared statement. Upon successful completion of the transaction, Duo employees will join Cisco's Security Business Group led by SVP Gee Rittenhouse within its Networking and Security business under EVP and GM David Goeckeler.