Cybersecurity Boom: How AI and Geopolitics Reshaped the M&A Landscape in 2024
Source: CyberTech, et al.”Future-Proof your Supply-Chain with Agility and Data-First Approach.” CyberTech, 7 Aug. 2024
The market for mergers and acquisitions in the cybersecurity space had a significant rebound in 2024 after a rocky year in 2023. The growth in M&A deals is largely driven by the need to tackle sophisticated cyber threats, as well as machine learning (ML) and artificial intelligence (AI) integration. The rebound is evidenced by a series of high-scale deals and a significant spike in deal values that collectively signify considerable investor belief in future developments in the industry. This article explores the underlying drivers fueling this recovery in the M&A space, industry trends in place, and influential deals that have defined the cybersecurity space in 2024.
Market Recovery and Growth Drivers
Following an 18.8% fall in transaction volume in 2023, the M&A activity in the cybersecurity industry has made a stunning recovery in 2024, with year-to-date deals up by 13.6% over the last year. This recovery is driven by a host of reasons, such as the ongoing integration of AI and ML technologies to combat cyber threats and a continued rise in cyberattack frequencies. The April 2024 IOP of Rubrik supported these trends by highlighting a strong demand for its solutions in cyber resilience and data protection. Rubrik is a leading company in ransomware protection and despite reporting operational losses, managed to successfully go public, reflecting a solid market demand for firms that focus on security in product innovation driven by AI.
The growth in the sector has, therefore, been accompanied by an increase in significant deals. Clairfield’s 2024 report on cybersecurity has reported that a better financing climate in combination with a shift in seller expectations on valuation has led to more realistic terms of negotiations. Most importantly, there has been a return of large private equity (PE) deals as financially sound private companies have made significant acquisitions in the field of cybersecurity.
Key Trends Shaping Cybersecurity
The cybersecurity scene in 2024 was undergoing a significant shift with the rise of new technologies and a growing fear of cyber threats. According to the Clairfield report, several trends are said to be shaping the future of the industry that have far-reaching implications for organizational security policy formulation.
A significant shift that can be seen today is the integration of ML and AI in security services. AI-based solutions like Intrusion Detection Systems (IDS) have come a long way and can now detect and react to potential threats at a never-before-seen pace. These systems use anomaly detection to identify variations in known behavior patterns and detect flaws before malicious actors have a chance to use them. The integration of AI and ML in cyber defence infrastructure not only improves threat prevention strength but makes defense a more proactive endeavor. With more and more organizations embracing these technologies, the solution market with AI integration is projected to grow at a significant rate.
Another area of relevance is Cloud Security Posture Management, better known as CSPM. The sudden shift towards cloud-based infrastructures has brought in new threats that have underlined the need for solution providers that enable real-time monitoring and compliance with security standards. CSPM solutions continuously conduct threat evaluations and enable organizations to implement a solid cloud security posture. With organizations increasingly moving their activities to the cloud, CSPM has become a critical component of their security system that helps in protecting sensitive data and ensuring compliance with industry standards.
The establishment of Zero Trust architecture in conjunction with Identity and Access Management (IAM) has become a cornerstone of contemporary cybersecurity practices. Zero Trust is based on the principle of “never trust, always verify,” where users are made to authenticate at every point of entry in a network. This ensures a drastic reduction in lateral movement between connected systems and thereby internal as well as external threats. IAM solutions further restrict access to sensitive data to only authorized personnel and continuously scan for weaknesses and security breaches. With more and more use of cloud-based infrastructure and remote workplaces on the rise, demand for these technologies has grown exponentially and has become a must-have component for organizations that are committed to protecting their digital assets.
The importance of geopolitical uncertainty also cannot be overemphasized. Sustained global conflicts in such regions as the Middle East have heightened both the magnitude and complexity of cyber attacks, especially those that are state-sponsored. Increased use of tighter compliance regulations in vulnerable sectors like finance and healthcare has heightened the need for organizations to implement sophisticated cybersecurity measures to protect their information. In this climate of uncertainty, organizations are directing more resources not only towards bolstering their defense capabilities but also towards acquiring holistic solutions that are designed to counter a diverse range of threats. These trends are driving consolidation in the industry as major players acquire small organizations in a bid to diversify their service offerings and be able to offer bundled cybersecurity solutions.
Notable Recent Cybersecurity M&A Transactions
The cybersecurity sector has had a series of notable events in 2024 and 2025 that demonstrate the keenness of strategic and PE investors in acquiring it.
The IPO by Rubrik in April 2024 is a notable milestone in the cybersecurity industry. Despite revelations of large operational losses, Rubrik has been successful in raising $752 million at a valuation that is 21% more than its listing price. The achievement highlights investor faith in AI-powered cybersecurity solutions as well as Rubrik’s ability to counter ransomware attacks.
After unsuccessful talks in the summer of 2024, Google successfully acquired Israeli cybersecurity company Wiz for $32 billion in early 2025, making it the largest deal in cybersecurity history. The cutting-edge threat detection features and stunning growth of Wiz have made it a desirable prospect for large tech firms looking to ramp up their cybersecurity. With this acquisition, Google aims to integrate Wiz’s AI-driven security solutions into its cloud infrastructure, enhancing its ability to protect against emerging threats.
Thoma Bravo finalized its acquisition of Everbridge in a deal worth a total of $1.5 billion. The acquisition comes on top of Thoma Bravo’s acquisition of Darktrace and reflects ongoing focus by PE companies on the cybersecurity industry through large investments in solid tech platforms.
The European PE group EQT has acquired a controlling stake in Acronis, further strengthening Acronis’ leadership in the data protection market. The deal reflects the growing demand by PE investors for scalable cybersecurity assets with significant long-term growth opportunities.
Conclusion
The resurgence of the M&A market in the field of cybersecurity in 2024 is a testament to the strength of this sector and the growing need for sophisticated cyber defence tools as threats constantly evolve. The use of AI, ML, and cloud-based solutions makes the cybersecurity industry very attractive to strategic acquirers and PE investors. With major deals having a significant impact on market dynamics, the future of M&A in the cybersecurity space is positive and driven by a mixture of innovative technologies, regulatory needs, and investors’ demand for scalable and AI-powered security solutions. The current pattern of consolidation is projected to facilitate more holistic platforms with a wide range of contemporary business needs and a counter to a more sophisticated range of cyber threats.