Private equity firm Vector Capital is acquiring majority ownership of WatchGuard Technologies from Francisco Partners and other co-investors, the companies disclosed today. Vector and Francisco Partners have previously co-owned WatchGuard for more than a decade. Financial terms and the deal's valuation were not disclosed.
This is technology M&A deal number 420 that MSSP Alert and sister site ChannelE2E have covered so far in 2022.
Related ChannelE2E Interview: WatchGuard Senior VP Michelle Welch further describes the company's MSP partner strategy.
WatchGuard's MSP Partner Focus Will Continue
WatchGuard's security platform extends from roughly 17,000 MSPs out to roughly 250,000 end-customer businesses worldwide. The platform supports network security and intelligence, endpoint protection, multi-factor authentication (MFA), and secure WiFi.
Under Vector Capital's majority ownership, WatchGuard plans to continues its investments in cloud-based services and such areas as secure access service edge (SASE), extended detection and response (XDR), managed detection and response (MDR), and MSP-centric consumption and delivery models.
In a prepared statement about the deal, WatchGuard CEO Prakash Panjwani said:
“Vector firmly believes in WatchGuard’s portfolio, partners, employees, and vision. This transaction is a testament to WatchGuard’s current success and the opportunity ahead. We believe Vector is well positioned to further accelerate WatchGuard’s growth strategy while preserving our company culture and commitment to security delivery through the MSP community.”
Added Alex Slusky, founder, managing director and chief investment officer of Vector Capital:
“We are thrilled to continue the journey we started with WatchGuard’s employees, partners, and customers over a decade ago. We are proud of the foundation of success we’ve built with WatchGuard’s management team and look forward to fueling the next phase of growth and transformation for the company.”
Added Sandy Gill, managing director of Vector Capital:
“MSPs represent the future of security delivery, but to be successful, they need a bespoke platform built for their needs. WatchGuard is uniquely positioned to lead the market in enabling those MSPs with its Unified Security Platform. We are excited to further invest both organically and via acquisitions in the company’s mission to deliver security-focused MSPs one vendor, one platform, and one vision to build their business upon.”
Concluded Ben Ball, partner of Francisco Partners:
“WatchGuard has established itself as a leading cybersecurity company under our joint ownership, with a relevant product portfolio, strong partner ecosystem, and talented team of employees. We are proud of our role in supporting WatchGuard’s transformation, and we look forward to following the company’s ongoing success as they continue to pave the way for simplified security when the industry needs it most.”
The deal is expected to close by the end of Q3 2022.
Private Equity and MSP Technology Companies
Meanwhile, private equity interest in the MSP-oriented technology market remains strong. The Vector Capital-WatchGuard deal surfaces one week after Kaseya -- backed by Insight Partners -- acquired Datto. The same week, KKR acquired Barracuda Networks from private equity firm Thoma Bravo.