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Carbon Black SVP: VMware Will ‘Leapfrog’ Cisco, Palo Alto Networks

“[VMware and Carbon Black] is just going to leapfrog the competition, there’s no question,” said Tom Barsi, senior vice president of corporate and business development for Carbon Black.

Carbon Black executive Tom Barsi expects VMware to grow the cybersecurity company into a $1 billion business after it merges with the virtualization star, with plans to leave Cisco and Palo Alto Networks in the dust.

“[VMware and Carbon Black] is just going to leapfrog the competition, there’s no question,” said Tom Barsi, senior vice president of corporate and business development for Carbon Black in an interview with CRN at VMWorld 2019. “Look, Palo Alto has nothing on Carbon Black from a next-generation endpoint protection platform – the ability to do [Endpoint Detection and Response], the ability to do [Next-generation Antivirus] … and [our] single cloud-native backend multi-tenant system is super, super powerful. Palo Alto does not have that capability. Cisco does not have that capability.”

Last week, VMware disclosed it had entered into a definitive agreement to purchase Carbon Black for a value of $2.1 billion as well as Pivotal Software for a value of $2.7 billion. VMware will acquire Carbon Black through a cash tender offer of $26 per share.

[Related: VMware CEO Pat Gelsinger’s 5 Boldest Statements At VMWorld]

Cisco and Palo Alto Networks did not respond to requests for comment by press time.

Barsi said Carbon Black technology will be “sprinkled” throughout VMware’s portfolio. While the two companies already have teamed to integrate Carbon Black technology with VMware’s data center endpoint security product AppDefense as well as the digital workspace platform Workspace ONE, technology synergies between Carbon Black and VMware will be taken to the next level after the deal closes, said Barsi.

“Embedding [Carbon Black] in vSphere, embedding it in NXS, embedding it across all the server infrastructure is super, super powerful,” said Barsi. “We’ve already integrated with AppDefense where we have an exclusive integration with AppDefense that allows our security buyers to integrate into the hypervisor and get telemetry that they’ve never seen before. We have an integration already with Workspace ONE, where they’re leveraging our technology and our next-gen EPP [Endpoint Protection Platform] and NGAV capabilities within Workspace ONE. So there’s already integrations across the portfolio. We’re only going to make it tighter and more integrated going forward.”

Barsi said the two companies expect to make security a part of the intrinsic fabric of VMware’s core platforms, which creates a huge opportunity for channel partners.

“Now with the addition of Carbon Black’s next-generation EPP platform, they truly are an end-to-end leader across endpoint, across server, across hybrid cloud and the opportunity from a channel perspective is just super, super exciting,” said Barsi. “I just can’t wait to expose the Carbon Black technology, our leading technology, to these over 70,000 partners that VMware has.”

VMware is majority-owned by Dell Technologies, which is the worldwide market leader in storage, servers and hyper-converged infrastructure.

Barsi said combining with the $91 billion infrastructure leader Dell Technologies will no doubt boost Carbon Black’s market reach to new heights.

“There is just no question what Dell brings to this entire capability and reach. So the ability for us to extend our capability and embed into Dell infrastructure and leverage the massive, massive channel of Dell EMC,” he said.

Additionally, VMware has a successful track record of boosting market reach and revenue for companies it acquires.

“They’ve taken technologies like Nicira and NSX, and taken it to [a] $2 billion [run rate]. They’ve taken AirWatch from $100 million, $200 million in revenue -- they’ve taken that to $2 billion,” said Barsi. “Well Carbon Black, we’re on a $250 million run rate right now ... Once this thing closes, we feel like we’re going to be a $1 billion-plus business.”

VMware CEO Pat Gelsinger recently said the acquisitions of Pivotal and Carbon Black will create more than $3 billion in hybrid cloud and Software-as-a-Service revenue in just two years after the deals close. “With both companies, we will be the only vendor able to deliver software solutions that enable customers to build, run, manage, connect and protect any app on any cloud and any device,” said Gelsinger. “This is also an opportunity to change the security market entirely.”

VMware expects to close both the Pivotal and Carbon Black deals in the second half of VMware’s fiscal year 2020, which ends Jan. 31, 2020.

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