Venture Capital Funding of Cybersecurity Firms Hit Record High in 2018

Venture capital investments in cybersecurity firms hit a record high last year amid a surge in cyber crime over the last few years.

• By Sydny Shepard
• Jan 24, 2019

Venture capital investments in cybersecurity firms hit a record high last year amid a surge in cyber crime over the last few years, according to a report released last week by U.S.-based Strategic Cyber Ventures. 

Total venture capital funding in the space totaled $5.3 billion in 2018, a 20 percent increase from the $4.4 billion seen in 2017. 

"We're seeing mega-breaches happening on an extremely frequent basis," Chris Ahern, data scientist and principal at Strategic Cyber Ventures told Reuters. "I don't think that is going to stop anytime soon. Any investors are seeing that as an opportunity for investment."

Cybersecurity has become the focus for governments and corporations around the world as digital crime increase. The latest quarterly data from cybersecurity firm ThreatMatrix showed that it detected 210 million attacks in the first quarter of last year, with another 151 million seen in the second quarter. 

Compared with 2015, cyberattacks have surged more than 100 percent, illustrating an overall heightened risk landscape over the last two years. 

U.S. cybersecurity firms took the majority of the investments, accounting for 46 percent of the investments in 2018. Asian and European companies took 22.6 percent of global investment, up 12.7 percent in 2014.

"We've seen this trend in the broader tech ecosystem as well, with many large international funds and investment outside of the U.S.," the report said. "Simply put, amazing and valuable technology companies are being created, in and outside of the U.S."