Accelerating Cybersecurity Innovation = = October 16, 2018 - - PowerPoint PPT Presentation

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Accelerating Cybersecurity Innovation = = October 16, 2018 - - PowerPoint PPT Presentation

= Accelerating Cybersecurity Innovation = = October 16, 2018 www.mach37.com Americas Premier Cybersecurity Accelerator = MACH37 TM is creating the next generation of disruptive cybersecurity product companies. Launched 43 start-ups


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= = Accelerating Cybersecurity Innovation

October 16, 2018

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America’s Premier Cybersecurity Accelerator

MACH37 2214 Rock Hill Road, Suite 270 Herndon, VA 20170

MACH37TM is creating the next generation of disruptive cybersecurity product companies.

  • Launched 43 start-ups that are driving

innovative security products to market

  • Emerging as a best of breed accelerator with

demonstrated success in launching investable companies

  • Attracting the best seed stage concepts from

around the U.S. and 22 other countries

  • Growing a mentor network of 200+

cybersecurity leaders

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www.mach37.com MACH37 2214 Rock Hill Road, Suite 270 Herndon, VA 20170

Relationship with CIT and Virginia

  • MACH37 is a joint partnership
  • Virginia commitment

– For initial investment ($50,000), MACH37 companies commit to establishing a significant presence in Virginia within two years (e.g., regional sales presence, government services operation) – Additional matching funds ($100,000) from the CIT GAP Funds require companies to establish headquarters in Virginia

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MACH37 Emerging with Best of Breed

  • Technical founder,

solving problems they faced in industry

  • 12 of first 17

companies seeded – 70% seed rate tracks best-of-breed accelerators – The Fall 2014 Cohort achieved an 85% seed funding rate – $7.0M in leveraged capital – 5.0x leverage ratio – Multiple Series A rounds expected for next 12 months – Will double current

leverage ratio and unrealized ROI

MACH37 2214 Rock Hill Road, Suite 270 Herndon, VA 20170 MACH37 2214 Rock Hill Road, Suite 270 Herndon, VA 20170

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Emerging Global Brand In Cybersecurity

Through active thought leadership, MACH37 has emerged as a leader in the global cybersecurity and technology innovation dialog - driving high quality deal flow.

MACH37 2214 Rock Hill Road, Suite 270 Herndon, VA 20170

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Maturity

Founding Team Established Prototype Completed Initial Seed Round Raised Beta Deployment Achieved Reference Customers Established

Invested Capital

MACH37 2214 Rock Hill Road, Suite 270 Herndon, VA 20170 Series A Investment

MACH37TM companies continue to mature, achieving critical market and investor validation.

The MACH37 System Works

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MACH37TM Leadership

MACH37 2214 Rock Hill Road, Suite 270 Herndon, VA 20170

Jason Chen – Chief Executive Officer 15+ years of business stategy. Founder of VentureScope. Jen O’Daniel – Investment Director Leads cybersecurity investments for MACH37 and CIT. Co-host of Cyberscoop’s Securiosity

  • Podcast. Leads 75+ member angel investing

group.

MACH37TM is lead by an experienced team of cybersecurity entrepreneurs, operators, technologists, and investors.

Tom Weithman – Chief Investment Officer Managing Director of CIT GAP Funds, Board Member, Virginia Tech Intellectual Property Foundation, IBM, Hughs Electronics David Ihrie– Chief Technology Officer CTO of the Center for Innovative Technology, CTO of the National Technology Alliance, VP of Government Programs for Semandex Networks, principal in five technology startups

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MACH37 Ecosystem

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MACH37 Fall 17 Cohort

Overall further along product development and customer engagement

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MACH37 Portfolio

Network & Infrastructure Security Web Security Endpoint Security Risk & Compliance Identity & Access Management Threat Intelligence IOT Digital Risk Mgt Blockchain Cloud Security

(Sopho s) (Silico m) (Symante c)

Security Ops & IR Messaging Security Fraud & Transaction Security Security Consulting MSSP

(CA)

Data Security

(Thycoti c)

Mobile Security

(Okta)

Application Security

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Security Investing

  • ~ 4% of overall venture spending
  • Longer to grow
  • Smaller exits
  • Cockroaches not Unicorns
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Security Landscape

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VC Deals by Country

Source: CBInsights

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Venture Capital Investment

$21 Billion across 2,100 deals

Source: CBInsights

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VC Deals – New Players

Source: CBInsights

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VC Deals - Valuations

Source: Pitchbook

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VC Deals - $100M+ deals

Source: CBInsights

Greater valuation = fewer potential acquirers

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Security Companies are Cockroaches not Unicorns

Source: Momentum Cyber

175 M & A transactions in 2017, the median value was

$68 million

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IPOs

Source: Momentum Cyber, Pitchbook

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Security Landscape

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Future Cyber Spending

Security Spending by Segment, 2017-2022 (Constant $ Millions) - May 2018 CAGR 2017 2018 2019 2020 2021 2022 2017 2018 2019 2020 2021 2022 2017-2022 Identity and Access Management Web Access Management 1,150 1,193 1,239 1,290 1,343 1,401 3.8% 3.8% 3.8% 4.1% 4.1% 4.3% 4.0% Other Identify Access Management 1,605 1,806 2,025 2,226 2,435 2,695 15.4% 12.6% 12.1% 9.9% 9.4% 10.7% 10.9% Identity Governance & Administration 1,927 2,096 2,282 2,488 2,719 2,968 8.8% 8.8% 8.9% 9.0% 9.3% 9.1% 9.0% Total 4,681 5,095 5,546 6,003 6,497 7,064 9.6% 8.8% 8.9% 8.2% 8.2% 8.7% 8.6% Infrastructure Protection Endpoint Protection Platform (Enterprise) 4,063 4,161 4,261 4,367 4,474 4,588 2.4% 2.4% 2.4% 2.5% 2.5% 2.5% 2.5% Other Security Software 5,892 6,405 6,978 7,668 8,387 9,280 9.2% 8.7% 9.0% 9.9% 9.4% 10.6% 9.5% Secure E-mail Gateway 1,632 1,649 1,664 1,679 1,691 1,712 1.1% 1.0% 0.9% 0.9% 0.7% 1.2% 1.0% Secure Web Gateway 2,342 2,509 2,690 2,891 3,114 3,339 7.1% 7.1% 7.2% 7.5% 7.7% 7.2% 7.4% Security Information and Event Mgt (SIEM) 2,363 2,583 2,826 3,099 3,404 3,723 9.0% 9.3% 9.4% 9.6% 9.8% 9.4% 9.5% Data Loss Prevention 965 1,060 1,166 1,286 1,421 1,558 9.6% 9.9% 10.0% 10.3% 10.5% 9.6% 10.1% Security Testing 679 775 884 1,010 1,156 1,319 13.9% 14.1% 14.1% 14.3% 14.4% 14.1% 14.2% Total 17,937 19,141 20,471 22,000 23,647 25,519 6.7% 6.7% 6.9% 7.5% 7.5% 7.9% 7.3% Network Security Equipment IPS Equipment 1,199 1,007 937 864 784 709

  • 19.5%
  • 16.0%
  • 7.0%
  • 7.7%
  • 9.2%
  • 9.6%
  • 10.0%

Firewall Equipment 10,743 11,749 12,737 13,584 14,355 15,133 15.0% 9.4% 8.4% 6.6% 5.7% 5.4% 7.1% Total 11,942 12,756 13,674 14,448 15,140 15,842 10.3% 6.8% 7.2% 5.7% 4.8% 4.6% 5.8% Security Services Consulting 20,743 22,561 24,517 26,568 28,736 31,125 7.4% 8.8% 8.7% 8.4% 8.2% 8.3% 8.5% Hardware Support 1,613 1,703 1,799 1,896 2,000 2,109 6.1% 5.6% 5.6% 5.4% 5.5% 5.5% 5.5% Implementation 17,478 18,624 19,821 21,100 22,464 23,940 7.2% 6.6% 6.4% 6.5% 6.5% 6.6% 6.5% IT Outsourcing 18,689 20,720 23,135 25,809 28,757 32,050 10.8% 10.9% 11.7% 11.6% 11.4% 11.5% 11.4% Total 58,524 63,608 69,272 75,373 81,956 89,224 8.7% 12.2% 9.0% 8.9% 8.8% 8.9% 9.6% Consumer 5,225 5,305 5,383 5,464 5,550 5,639 1.4% 1.5% 1.5% 1.5% 1.6% 1.6% 1.5% Grand Total 98,308 105,905 114,346 123,289 132,790 143,287 7.9% 7.7% 8.0% 7.8% 7.7% 7.9% 7.8%

Source: Gartner

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Identity & Access Management

  • $1.7 Billion, 15.5% growth in 2018
  • Through 2020, over 50% of IaaS security

failures will result from inadequate customer management of identities, access and privileges

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Web Application Firewalls & Web Security

  • Forecasted at $853M in 2018

– DDoS protection – Bot management – CDN – Magecart breech

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Securing OT & IoT

  • Significant problem
  • Data Centers
  • Bloomberg SuperMicro article
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Weekly Podcast – www.cyberscoop.com Security news recap Interview with leading innovators

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Questions

Jen O’Daniel Jennifer.ODaniel@mach37.com Twitter: @DCVCJen