Posted on Monday, Aug 3rd 2015
A recent MarketsandMarkets report projects the global cybersecurity market to grow 10% annually from $106.32 billion this year to $170.21 billion by the year 2020. The researcher reveals that while North America will be the largest market for the industry, the growth will actually be driven by the Latin American and Asia Pacific markets. Billion Dollar Unicorn club member Rapid7 is a recently listed player in this industry.
Boston-based Rapid7 was founded in 2000 by serial entrepreneur, Alan Matthews, Tas Giakouminakis, and Chad Loder. Rapid7 was set up with the objective of providing a comprehensive security solution for organizations that would identify vulnerabilities across the entire IT environment of network, hardware, software, web, and database components and help organizations take decisions on them.
The Rapid7 security solution follows an analytics driven approach that protects organizations from cyberattacks by analyzing network traffic and usage data to detect threats. They are the leading providers of security data and analytics solutions that help organizations contextualize and prioritize threats facing their physical, virtual, and cloud assets as well as those threats that are created due to user behavior. Using their tools, organizations can dynamically manage their cyber security exposure, prevent attacks by getting insight into vulnerabilities, rapidly detect compromises, respond to breaches, and rectify the underlying causes of attacks.
Their threat exposure management offerings include vulnerability management products that have been integrated with security analytics capabilities to deliver contextual risk prioritization, critical threat awareness, and impactful remediation guidance. They have also integrated the analytics capabilities with penetration testing to enable robust ongoing attack simulation solutions that provide organizations visibility into real-world threats. Their recent products include an incident detection product that helps organizations rapidly detect and respond to cyber security incidents and breaches and an incident response solution to improve responses to these breaches by providing organizations with access to their team of experts.
Their product offerings have helped them acquire an impressive array of customers. As of March this year, they had over 3,900 customers which included more than 30% of the Fortune 1000.
Rapid7 has seen strong revenue growth as well. They earn revenues through sale of products and consulting service and through maintenance contracts. Revenues have grown from 35% annually from $31 million in 2011 to $76.9 million in 2014. But losses have grown as well, from $12.39 million in 2012 to $32.24 million in 2014.
By segment, product revenues account for the largest share of revenues. Last year, Rapid7’s product segment generated $47 million in revenues. Maintenance and support revenues were at $19 million and revenues from professional services came in at $10.8 million.
Till recently, Rapid7 was venture funded with $89 million raised from investors including Bain Capital Ventures and Technology Crossover Ventures. Their last round of funding was held in December 2014, when they raised $30 million at an undisclosed valuation. Last month, Rapid7 went public on the Nasdaq under the ticker RPD by selling 6.45 million shares at $16 per share to raise $103.2 million – translating to a pre-trading valuation of $605 million.
Their stock has done well since it went public, taking them close to the gates of the Billion Dollar Unicorn club. It is currently trading at $22.98 with a market capitalization of $875.48 million. It touched a high of $27.45 on the day it listed.
More investigation and analysis of Unicorn companies can be found in my latest Entrepreneur Journeys book, Billion Dollar Unicorns. Unicorns will also be discussed with some special guests during our 1M/1M Roundtable programs over the next few weeks. To be a part of the conversation, please register here. The term Unicorn was coined in a TechCrunch article by Aileen Lee of Cowboy Ventures.
This segment is a part in the series : Billion Dollar Unicorns
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