The New Endpoint Security Market…

Venture capital investments in companies are aggressive these days but yesterday’s news was startling nonetheless. First, Cylance announced a round of $120 million led by . Cylance says that the funding will help it expand sales and marketing initiatives and extend its global footprint.

Not to be outdone, Cylance archenemy announced a round of $200m, led by and , and now claims a valuation of more than $3 billion. Like its rival, CrowdStrike says that the new funding will go toward sales and marketing as well as product development.

These two “unicorns” are not alone. Tanium and have also enjoyed funding rounds of $100m while raised $70m in a series C round last year. Holy antivirus, Batman!

Now all this seems a little crazy at first glance. After all, the entire endpoint security market is somewhere in the 5 to 7 billion-dollar range and its currently dominated by a cabal of vendors including Kaspersky Lab, , , Symantec, Trend Micro, and Webroot. Given this market reality, it’s fair to ask how the Sand Hill Rd. phat cats can justify this level of investment in a crowded and mature market.

Yup, endpoint security investment is aggressive but there is some wisdom behind this VC strategy. Today’s endpoint security market no longer looks like the antivirus market circa 2008. Rather, it is transforming rapidly for several reasons:

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