In a significant move within the cybersecurity industry, Akamai Technologies has confirmed its acquisition of Noname Security for $450 million. This acquisition not only broadens Akamai’s cybersecurity portfolio but also consolidates its position as a leader in the increasingly vital API security sector. The deal, as revealed a couple of weeks after initial reports by TechCrunch, firms a growing trend of consolidation in the cybersecurity market.
Market Trends
The cybersecurity landscape has witnessed a surge in the emergence of startups over the last several years, yet many of these new entrants have struggled with scaling, funding, and reaching customers seeking comprehensive solutions. Akamai’s acquisition of Noname at a price significantly lower than its last private valuation, which was about $1 billion in December 2021, reflects a broader market trend where larger companies absorb smaller, promising players at a steep discount.
Acquisition Details
Originally speculated to close around $500 million, the acquisition settled at $450 million. “Sometimes, that is at a steep discount,” acknowledges the broader market dynamics and the challenges faced by startups like Noname. Akamai’s integration of Noname into its API Security business is expected to add approximately $20 million to its revenue in the fiscal year 2024, a testament to the strategic value of this acquisition.
.@Akamai buys API security unicorn @NonameSecurity for $450 million this week. I hope @giliraanan and other investors had a good exit.
Noname was valued at $1 billion in late 2021 when they raised $135 Million in Series C. The startup had raised at least $220 million in total… pic.twitter.com/mNacSg0Del
— Sarbjeet Johal (@sarbjeetjohal) May 9, 2024
Strategic Benefits
“Akamai has seen a growing need for API protection with our own data showing 109% year-over-year growth in API attacks,” – Mani Sundaram, EVP and General Manager of Akamai’s Security Technology Group. With Noname’s technology,
Akamai aims to offer comprehensive API protection across all environments, whether cloud, edge, on-premise, or other vendor platforms.
Future Outlook
The deal, expected to close in the second quarter of 2024, marks a critical step for Akamai in addressing the evolving security needs amid rapid digital transformation. “API development continues to proliferate as customers prioritize their investments in application modernization and digital transformation initiatives,” said Oz Golan, CEO and co-founder of Noname. This integration promises a robust solution for any customer’s application security needs.
What Does This Mean for the Future of API Security?
Akamai’s acquisition of Noname Security not only reflects the dynamic nature of the cybersecurity market but also positions the company to better meet the increasing demands for comprehensive API security solutions. As the digital landscape evolves, so does the necessity for robust cybersecurity measures. We encourage our readers to share their thoughts and comments on how this acquisition might influence the future of API security and digital transformation strategies.
