Proofpoint To Acquire ObserveIT For $225M

As cyber threats become more frequent and complex, cybersecurity company Proofpoint is adding another startup to its roster.

The company has agreed to acquire threat management startup ObserveIT for $225 million, the companies announced Sunday.

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The deal, which is expected to close later in the fourth quarter, will help Proofpoint expand its data loss prevention (DLP) capabilities, according to the company. ObserveIT helps companies identify and then eliminate insider security threats.

“Defending data requires the ability to detect risky insider threat behavior and risky user activity, and swiftly mitigate risk across cloud apps, email, and endpoints,” Proofpoint CEO Gary Steele said in a statement. “We are the only security company that provides organizations with deep visibility into their most attacked people—and with ObserveIT, we will bring to market the first truly innovative enterprise DLP offering in years.”

The integrated data loss prevention platform will make sure companies’ data is secure across devices and applications as more and more employees work remotely.

“We are very excited to join the Proofpoint team and provide customers with even more powerful solutions to mitigate insider threats, decrease incident investigation time, and make sure users don’t intentionally or accidentally send valuable, confidential information externally,” said ObserveIT CEO Mike McKee.

ObserveIT, which is based in Boston, attracted $53 million in funding as a private company, with Bain Capital Ventures as a leading investor in its funding rounds. ObserveIT raised its $20 million Series A in December 2013, its $16 million Series B in April 2018, and another Series B in July 2018 for $17 million, according to Crunchbase.

ObserveIT marks Sunnyvale-based Proofpoint’s 17th acquisition to date, according to Crunchbase. It last acquired Meta Networks in May.

Proofpoint, which was founded in 2002, went public in 2012 on the Nasdaq after raising $85.5 million in total funding.

ObserveIT may be its latest acquisition, but we have a feeling that it won’t be its last.

Illustration Credit: Li-Anne Dias