Subj : More cybersecurity firms could collapse soon, experts warn
To   : All
From : TechnologyDaily
Date : Fri Oct 20 2023 11:45:05

More cybersecurity firms could collapse soon, experts warn

Date:
Fri, 20 Oct 2023 10:20:01 +0000

Description:
Cybersecurity leaders think that other firms may go the way of IronNet if 
they don't get their priorities right.

FULL STORY
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Many leaders in the cybersecurity industry believe that following the recent 
bankruptcy of IronNet, other companies may soon follow suit. 

Speaking to SC Media , they said that IronNet may not be the only case of its 
kind that we witness, due to the recent speculative investment in the 
industry and the failure of firms to pay off their debts. 

Leaders therefore felt that similar companies to IronNet may have to initiate 
layoffs, merge with other companies, or go outright bankrupt. IronNet first 
axed staff last year in an attempt to stay afloat, but then terminated its 
remaining staff and operations altogether on September 29 2023. How to avoid 
closure 

IronNet was valued at $1.2bn when it went public, however, its troubles began 
when it was sued by shareholders for allegedly overestimating its potential 
for growth. It then struggled to secure payment from clients and debts began 
to grow. As part of the Chapter 11 restructuring plan, IronNet will be paying 
back $35mn owed to creditors via asset sales. 

We will see more of these bankruptcies with highly leveraged cybersecurity 
companies, even those with unicorn status, said Approov CEO Ted Miracco. In 
light of a recent report showing a 6% expansion in security budgets, Miracco 
added that, "this is fundamentally incompatible with the large cadre of VC 
backed companies that expect triple-digit growth figures, especially in this 
current economic environment. 

He believed that firms who have experience doing well in such environments 
will be more resilient, if they also have their eyes on profits and 
innovation. 

The issue of tool sprawl was also highlighted, with its propensity to create 
inefficiencies and high costs. So it is expected that vendors will broaden 
the scope of their cybersecurity platforms to transform them into more 
holistic solutions for clients. 

Big names in the industry have recently announced layoffs, including Cisco, 
Fortinet, HackerOne, Secureworks, and others. Quanergy Solutions, SunGard 
Availability Services, and Cyren are also a few examples of firms who have 
filed for bankruptcy protection this year. MORE FROM TECHRADAR PRO What is 
the best cybersecurity solution for medium to large businesses? Cybersecurity 
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Link to news story:
https://www.techradar.com/pro/security/more-cybersecurity-firms-could-collapse
-soon-experts-warn


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