Investments in cybersecurity startups hit a record high of $7.8 billion last year, according to new data from Crunchbase. The increase was led by US investments in the sector, which rose by 22% in 2020 over 2019. This growth is 15% higher than the overall venture capital investments made over the same period.
Contrast this with the overall venture capital market where 39% of funding into cybersecurity startups was given to angel, seed, and early-stage outfits. Worldwide, the number rose by 45%.
Diversity of geography is not high on the list, given that the US and Israel combined, account for nearly 90% of all that cybersecurity venture funding. The US recorded 76% of all global cybersecurity funding for startups in 2020, at $5.9 billion.
The UK got about 3% ($262 million) in 2020, which was boosted by the Series C funding round for the data privacy company Privitar.
The numbers for cybersecurity startups continue to rise. Crunchbase reported that 2020 had six new cybersecurity unicorns (startups with valuations of more than $1 billion). That is the highest number ever recorded for any year. Five of them were from the U.S and the last one is from Israel (Cato Networks).
The top investor in cybersecurity in 2020 was Accel. It was followed by Insight Partners, Techstars, and Y Combinator. The last two were particularly interested in investing in early-stage companies. OurCrowd (Israel) and Singtel Innov8 (Singapore) also appeared on the list.
Hank Thomas, the CEO of venture capital firm Strategic Cyber Ventures, spoke to SiliconANGLE and said that we have an unprecedented and rapid experiment where the workforce is decentralized.
Cybersecurity has been forced to create new solutions and protect new environments. The market could continue to grow as we need more solutions.