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Akamai To Buy Micro-Segmentation Firm Guardicore For $600M

Michael Novinson

‘Just as the waterproof bulkheads in a submarine prevent adjacent compartments from becoming flooded in the event of a hull breach, Guardicore’s micro-segmentation contains the ‘blast radius’ from a malware attack,’ writes Akamai’s Charlie Gero.

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Akamai has agreed to purchase micro-segmentation vendor Guardicore to block the spread of malware more effectively within an enterprise, across the data center and cloud applications.

The Cambridge, Mass.-based digital experience vendor said Tel Aviv, Israel-based Guardicore drastically reduces the threat surface and risk exposure by limiting user access to only applications that are authorized to communicate with one another. This should help protect the flow of enterprise data across the network everywhere from bare metal to virtual machines to containers, according to Akamai.

“Given the recent surge in ransomware attacks and increasingly stringent compliance regulations, investing in technologies to reduce the spread of malware has become mission critical,” Akamai co-founder and CEO Tom Leighton said in a statement. “By adding Guardicore … we believe Akamai will be able to provide the most effective way to combat ransomware on the market today.”

[Related: Akamai Buys IoT Security Vendor Inverse To Better Spot Devices]

Akamai will pay $600 million for Guardicore and the deal is expected to contribute between $30 million and $35 million of revenue next year. The acquisition is expected to close in the fourth quarter of this year. Akamai’s stock is down $0.42 (0.40 percent) to $105.70 in pre-market trading Wednesday, which is the lowest the company’s stock has traded since May 4.

Guardicore was founded in 2013, employs 298 people and has raised $106 million in five rounds of outside funding. The company most recently closed a $60 million Series C funding round in May 2019 led by Qumra Capital. Akamai executives weren’t immediately available for additional comment.

“Guardicore’s mission is to protect enterprises from damage caused by breaches, like ransomware, while safeguarding the critical assets at the heart of the network,” Guardicore co-founder and CEO Pavel Gurvich said in a statement. “My team and I greatly look forward to joining Akamai to protect the user and the enterprise – no matter what the user is doing.”

Guardicore’s technology enables deep visibility into application flows across data center and cloud applications, allowing businesses to understand and protect their infrastructure more granularly from the core of the enterprise to the cloud, according to Akamai. As a result, Akamai said breaches can be detected early on and corrective actions can be taken as quickly as possible.

The company’s micro-segmentation technology logically divides the enterprise into distinct security segments down to the individual software and workload level with well-defined security controls for each, according to Charlie Gero, VP and CTO of Akamai’s Enterprise Division. This addresses the problem of malware proliferating across the enterprise via east-west movement, Gero wrote in a blog post.

“Just as the waterproof bulkheads in a submarine prevent adjacent compartments from becoming flooded in the event of a hull breach, Guardicore’s micro-segmentation contains the ‘blast radius’ from a malware attack, dramatically limiting its lateral spread,” Gero wrote Wednesday.

Guardicore employs an agent-based approach to segmentation, Gero said, meaning that agent-installed systems can only communicate with other agent-installed systems in the same segments or groups. Systems lacking agents can communicate only with other agentless devices and specifically chosen segments, separating them from high-value targets, according to Gero.

This agent-based strategy enables very fine-grain controls while greatly simplifying management with a centralized, visual portal that enables quick and easy configuration of the segmented network, according to Gero. In addition, Gero said Guardicore’s agent-based architecture provides visibility down to the individual application level, allowing businesses to understand their networks and workloads more fully.

“As a result, breaches can be detected early on so that remediation is taken as quickly as possible,” Gero wrote in the blog post. “This combination of deep visibility and segmentation is what makes this solution so powerful.”

Being acquired by Akamai will not cause any interruption in the service and support for existing Guardicore customers, who should expect even more innovation from the R&D team going forward, Gurvich wrote in a blog post Wednesday. Gurvich said Guardicore’s executive team will be staying onboard following the acquisition.

“It is a testament to this team that Akamai was interested not only in our world-class technology, but our world-class team as well,” Gurvich said. “No Guardicorian will be left behind. This isn’t an exit strategy; this is a massive growth opportunity.”

This is Akamai’s third significant cybersecurity acquisition in recent years, coming nearly eight months after the company bought Montreal, Quebec-based Inverse for $17.1 million to better identify and secure IoT and mobile devices such as internet-enabled HVAC, lighting systems, medical equipment, robotics, and printers in enterprise environments.

In January 2019, Akamai bought Portland, Ore.-based Janrain for $123.6 million to improve the security around customers’ apps, websites and APIs by leveraging identity access management. Fusing together Akamai’s bot manager with Janrain’s skill set allowed customers to make better decisions about which users should be allowed to access registration and login pages based on past online behavior.

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