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‘Shark Tank’ Star Herjavec: Broadcom-Symantec Deal Is A Dinosaur ‘Buying Another Dinosaur’

Herjavec Group CEO and ‘Shark Tank’ star Robert Herjavec is skeptical that Broadcom's planned $10.7 billion purchase of Symantec's enterprise security business will help the latter catch up with emerging endpoint players like CrowdStrike.

Robert Herjavec is skeptical that Broadcom's proposed $10.7 billion purchase of Symantec's enterprise security business will help the latter catch up with emerging players like CrowdStrike.

"[It's a dinosaur] buying another dinosaur before both dinosaurs go out of business," Herajvec said during a TD Ameritrade Network interview Thursday. "It's crazy."

Herjavec is a star on ABC's “Shark Tank” and founder and CEO of Toronto-based cybersecurity firm Herjavec Group, No. 96 on the 2019 CRN Solution Provider 500. Herjavec Group also is No. 113 on the 2019 CRN Fast Growth 150, with a two-year growth rate of 54.3 percent between 2016 and 2018.

[Related: $10.7B Broadcom-Symantec Enterprise Deal Creates Software Titan]

Broadcom and Symantec declined to comment for this story, while Herjavec Group didn't respond to a request for additional comment.

Despite being the biggest pure-play cybersecurity company by revenue in the world, Herjavec told the TD Ameritrade Network that Symantec has really struggled over time due to it having a highly fragmented business and not being great at any one particular thing. Specifically, Herjavec pointed to managed security and endpoint security as two areas where Symantec is no longer the world leader anymore.

On the flip side, Herjavec said Symantec still benefits from having a great brand and a strong enterprise presence. Herjavec said that Broadcom acquiring Symantec's $2.32 billion enterprise security business will help the semiconductor manufacturer gain entry into a lot of different enterprise customers.

"Never underestimate the need for a large corporation to do a dramatic move," Herjavec said. "I don't know what the impetus was."

Broadcom might have the vision of taking some of Symantec's cybersecurity software and putting it into its core semiconductor technology, Herjavec said, similar to what Intel attempted to do through its $7.7 billion purchase of top Symantec competitor McAfee in 2011. That vision didn't come to fruition, however, and Intel spun McAfee off to TPG in a 2016 sale valuing the business at just $4.2 billion.

"I'm skeptical of something like this," Herjavec said. "Symantec, as you know, has had a lot of trouble over the years, [and] a new CEO."

When Symantec and McAfee were really big in the 1990s and 2000s, Herjavec said the two companies owned the endpoint security world and organizations were less concerned about other cybersecurity concepts like identity, application security or the perimeter. Then endpoint died for a while, Herjavec said, as customers focused heavily on innovation in the network security space.

Today, the endpoint market is again the hottest space in cybersecurity, but Herjavec said the conversation is being driven by companies like CrowdStrike with incredible technology around detecting and responding to endpoint-based threats. Sunnyvale, Calif.-based CrowdStrike went public in June and currently has a market cap of $18.8 billion, which is $4.6 billion higher than the market cap of Symantec.

"CrowdStrike, and companies like them, have killed the McAfee [and] Symantec endpoint products," Herjavec said. "Symantec and McAfee have both missed that entire market."

Herjavec thinks McAfee will be able to catch up technology-wise with emerging endpoint security vendors CrowdStrike, SentinelOne and Carbon Black thanks in part to its new suite of products. Herjavec, however, said he's less bullish on Symantec being able to do so. Herjavec Group is a McAfee Support Provider (MASP) and Platinum Partner, according to the company's website.

In an investor presentation on the acquisition of Symantec's enterprise security business, Broadcom said Symantec’s enterprise security is the global market-share leader in endpoint security software, with endpoint revenue exceeding McAfee, CrowdStrike and Carbon Black.

Symantec and CrowdStrike placed highest in the 2018 Gartner Endpoint Protection Magic Quadrant Report for completeness of vision, but Gartner gave the nod to Symantec when it came to ability to execute.

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