fb-pixel Skip to main content

Local cybersecurity startup Snyk attracts $530 million in new cash

One of the largest venture capital deals of the year values the company at $8.5 billion.

Boston-based Snyk is valued by investors at $8.5 billion as of September.snyk.io/Source: snyk.io/Bloomberg

The local cybersecurity tech scene remains red-hot, as investors poured more than half a billion dollars into Boston startup Snyk in a deal announced on Thursday.

The funding round, which valued Snyk at $8.5 billion, positions the company to go public in the next year or two, joining Akamai, Rapid7, and CyberArk at the top of the region’s growing cybersecurity lineup.

Snyk, pronounced “sneak,” raised $300 million of new money for expansion and allowed employees and earlier investors to sell $230 million worth of their shares in the company. The company has now raised a total of $775 million.

Advertisement



One goal of the fund-raising was to add investors who also invest in public companies, such as T. Rowe Price and Tiger Global, to set up Snyk for a successful initial public offering, chief executive Peter McKay said.

“We wanted to focus more on the public investors, people who would want to buy us in the IPO,” McKay said. “The best way to handle your post-IPO investors is to get them in [before].”

Founded in 2015 by Guy Podjarny, a former Israeli cybersecurity expert and IBM and Akamai veteran, Snyk focuses on improving the security of software applications when they are being developed, instead of trying to chase down security vulnerabilities after the apps are in use.

About three million developers use Snyk’s mix of free and subscription security services, including at tech companies such as Google, Salesforce, and Intuit. The company said its services caught and corrected more than 30 million security problems in developers’ projects in the past 90 days.

Using Snyk’s security services also helps customers cut down on the number of security experts they need to hire on their own. President Biden highlighted the shortage of cybersecurity workers at a White House summit in August, noting that 500,000 jobs in the sector remain unfilled. “Our skilled cybersecurity workforce has not grown fast enough to keep pace,” Biden said.

Advertisement



Snyk, which employs 760 people including about 100 in Boston, plans to increase its pace of hiring to expand into new countries and also will consider acquisitions of other startups, McKay said.


Aaron Pressman can be reached at aaron.pressman@globe.com. Follow him on Twitter @ampressman.