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Sophos acquired for $3.9B
- huslage 7y agoThoma Bravo is really cleaning up lately.
- fludlight 7y ago"Cleaning up" is a phrase reserved for exits. Thoma Bravo is merely "acquisitive". They just raised a big new fund; it is common to have a couple of transactions lined up when raising a new fund so you can begin with a bang and deploy capital sooner rather than later.
- 142 7y agoTrue but they know how to maximize the spreadsheets. Expect to see some large returns for Thoma Bravo in the next few years. The investors will do real good -- from the investor perspective, they are great. Just sucks for the workers that get churned out in the process.
- bretpiatt 7y agoLink to Sophos release: https://www.sophos.com/en-us/press-office/press-releases/2019/10/thoma-bravo-makes-offer-to-acquire-sophos.aspx https://www.sophos.com/en-us/press-office/press-releases/201... (I was getting connection timeout errors on the linked article from the post)
- kriscroaker 7y agoI wonder if this was the suitor for HIBP who had their circumstances change?
- regnerba 7y agoThis was my first thought as well.
- buryat 7y agoSophos is the company I use to buy cycling socks, I think I should stock up before they close the store https://shop.sophos.com/collections/itsocks https://shop.sophos.com/collections/itsocks
- notatoad 7y agoHeh, I didn't realize they sold those. I got some a couple years ago as a freebie, not sure it was worth the amount of sophos marketing crap I got for the next year or so after I gave them my contact info.
- mhh__ 7y agoI have multiple legit emails for that exact reason. We had a competition to see who could get the most marketing rubbish at a university fair (this method meant I won, and also noticed an inverse correlation between academic prestige and marketing spending) and I never stopped.
- SanchoPanda 7y agoThey did a great job on this stuff.
- warent 7y agoHaha these are all amazing, definitely picking up some before they inevitably close it down. How is it possible that a security company makes better socks than many clothing companies? I mean, come on, you don't even have to be a huge tech nerd to appreciate Mr Miyagi's "Socks On Socks Off"
- oblio 7y agoI'm torn between "they're funny/cute" and "they're so lame" :-)
- wilg 7y agoshame the $3.9 billion wasn't an all-sock transaction
- ethiclub 7y agoGood move ...and the consolidations continue... I notice that the power of these new behemoths are a risk to SMEs. Kaseya/Datto/ITGlue/CWM/Automate/Sophos/BG/Sell... These all used to be of a size that could communicate and deal with small business. Far more focus weighted towards enterprise now.
- snuxoll 7y agoSophos still stays squarely in the security space at least, I wouldn’t exactly call them a behemoth. Now Cisco on the other hand, god damned they have their mitts in everything and most of it’s trash. But nobody got fired for buying Cisco, yet.
- gdsdfe 7y agoAnyone in this space can explain this acquisition? What's the end game here?
- deleted 7y ago[deleted]
- almost_usual 7y agoThoma Bravo has been acquiring companies in the infosec space. I’m assuming they’re trying to build a portfolio and maybe consolidate at some point.
- bretpiatt 7y agoTo add more specificity they now own Barracuda, Centrify, ConnectWise, idaptiv, imperva, imprivata, LogRythm, McAfee, solarwinds, Sophos, and Veracode in the "Current Investments" and "Security" sector defined on their own search filter[1]. [1] https://www.thomabravo.com/companies https://www.thomabravo.com/companies
- techntoke 7y agoTo build a coalition against the open source alternatives.
- therockspush 7y agoBought by Thoma Bravo. Fits the pattern. You would think they would be trying to mash up some these companies to corner the SMB security market but they seem to keep all their companies distinct. A few household names on the acquisition list. https://en.wikipedia.org/wiki/Thoma_Bravo#Transactions https://en.wikipedia.org/wiki/Thoma_Bravo#Transactions
- wutwutwutwut 7y agoLike mashing up Sophos and McAfee? Can you imagine the mess?
- cable2600 7y agoNo doubt there will be some downsizing before they get mashed up. McAfee used to be something in the 1990s, now it is bloatware.
- alexott 7y agoDon’t think about McAfee as Provider of only consumer stuff...
- jjoonathan 7y agoYeah, they provide enterprise-grade bloatware too.
- HenryBemis 7y agoI am still (proudly) using the McAfee Antivirus Enterprise edition on my Win Pro machine. It has (imho) the best options/flexibility. I also remember that the respective firewall was also super strong and very versatile but I can't get my hands on any latest version of it (I have the AV legally).
- exikyut 7y agoMy understanding is that Windows Defender is the only decent engine nowadays, but that's second-hand anecdata I can't measure the bias of (I don't currently use Windows).
- heybrendan 7y agoHow difficult would it have been to include "[...] by Thoma Bravo" in the headline?
- password4321 7y agoI hope this doesn't end the plan to open source https://sandboxie.com https://sandboxie.com after Sophos acquired Invencia.
- 142 7y agoHow many people laid off? Thoma Bravo is notorious for being extremely spreadsheet-driven and lays off. I feel bad for the employees.
- anandrm 7y agoI wonder what grand plan Thoma Bravo has, they are on a shopping spree on Network Security companies(Imperva,Barracuda,Sophos,Mcacfee...)
- AznHisoka 7y agoProbably as simple as reducing expenses, laying off people, restructuring and spinning the Frankenstein result in an IPO years later.
- kemonocode 7y agoA reminder that whenever any cybersecurity-related company gets acquired, any trust you have on them ought to be reset.
- motohagiography 7y agoNapkin math: So 3.9b / 600m Revenue = 6.5years horizon to breakeven. Assuming no growth plan, they can hollow out the operating costs by cutting staff by 1/4, and offshoring another 1/4. Guessing here, but their aim is a total return of +%30-%50 (~$2bn)over 10 years with relatively low risk vs. indexes or VC plays. It works, but it's like putting a company into a digester.
- CivBase 7y agoIs that 600m revenue or profit?
- swyx 7y agoyea dividing by revenue to calculate breakeven is just... not even worthy of the HN School of Business
- motohagiography 7y agoMultiples of revenue is a common valuation number that can imply the length of time an investor will expect they will be able to profit from it. At 66m/y in profit, that's under %2 annual return on their $4bn investment. To strip and flip the company on a 6-7 year timeframe would make sense. They'll probably need a technical CTO advising them on what's essential and what's not. However, take us to school. The opportunity to add value is clear.
- ttul 7y agoI think Sophos has just a touch more to it than that. They have a great deal of product and technology and tens of thousands of customers. TB will be interested in growth here by aligning Sophos with its other security assets. I think Sophos is the jewel in the crown frankly. McAfee was the sausage.
- _xander 7y agoIf that's the case, the challenge will be retaining the key people responsible for Sophos's 'intellectual capital' and sales relationships. It can be extremely costly to keep people after a PE acquisition in cyber - combination of removing the equity incentives (e.g. stock will eventually vest for the top people, if it hasn’t already) plus being in a very hot market where poaching talent is common plus general erosion in conditions to service the debt from the LBO. The cynic in me thinks TB knows cybersecurity will sell at even more ludicrous multiples in the future (and they’re swimming in dry powder), so they won’t need to care too much about the underlying health of the business. The optimist thinks that TB are the masters of this niche and see synergies I don’t. Source: I’ve done DDs in this space and our firm’s (public) stance is to encourage organic growth over doing deals
- wmil 7y agoOne hopes that they'll use the money to release a Mac version that isn't terrible.