October was another active month for cyber / intel markets, both from a policy and news standpoint, as well as with regard to transaction activity. On the government policy side, Secretary of Defense Leon Panetta, made shockwaves when he announced that the nation could experience a “cyber-Pearl Harbor” attack on critical infrastructure in the near future if comprehensive and binding cybersecurity legislation is not passed.
The Air Force published its “Cyber Vision 2025,” laying out key themes to ensure an enduring cyberspace advantage over our adversaries. The Big Data sector got a boost from a new report by Gartner that claimed Big Data-driven IT spending will reach $232 billion worldwide by 2016, implying a 4-year CAGR of nearly 25%.
With respect to M&A activity, Microsoft acquired two companies: PhoneFactor, Inc., a mobile security company that provides multi-factor authentication solutions; and StorSimple, Inc., a provider of enterprise storage services for Windows and VMware infrastructures. Raytheon made its eleventh cyber-related acquisition since 2007 with its purchase of Teligy, Inc., adding specialized wireless expertise to Raytheon’s security offerings.
On the Venture Capital front, Shine Security and Quarri Technologies, both of which specialize in mobile security solutions, received funding rounds to accelerate growth and development. Attivio, a Big Data analytics company, continued the theme of large funding rounds with a $34 million Series A investment. Finally, In-Q-Tel gave a vote of confidence to quantum computing and encryption technology after it joined a $30 million funding round for D-Wave Systems, a company at the forefront of developing quantum technology for commercial use.