Insight Partners Aims To Sell Privileged Access Firm Thycotic: Report

Private equity firm Insight Partners is in the early stages of preparations to sell privileged access management (PAM) vendor Thycotic after more than five years of ownership, according to a published report.


Private equity firm Insight Partners is preparing to sell privileged access management (PAM) vendor Thycotic after more than five years of ownership, PE Hub reported.

The sale process is currently in its early stages and Insight is being assisted by investment banking advisory firm Evercore in the process, according to PE Hub. Evercore declined to comment, while Thycotic and Insight Partners didn’t immediately respond to CRN requests for comment.

Washington, D.C.-based Thycotic generated $120 million in revenue and is nearly breakeven on earnings before interest, taxation, depreciation and amortization (EBITDA), sources told PE Hub, and roughly $100 million of Thycotic’s annual revenue is recurring, PE Hub reported. Thycotic is the fastest-growing company in the PAM market, growing at 40 percent year-over-year, one source told PE Hub.

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[Related: Security Firm Thycotic Ramps Up Professional Services Training For Partners]

Thycotic was founded in 1996, employs 514 people, and received a significant investment from Insight Partners in July 2015. The company has increased its headcount by 14 percent over the past year and 57 percent over the past two years, with the most significant hiring taking place in Thycotic’s engineering, sales and information technology departments, according to LinkedIn.

The company increased its global channel sales by 28 percent in 2020 thanks to new educational initiatives, enhanced customer service and marketing support for partners, Thycotic announced Monday. Thycotic increased partner deal registrations by 17 percent last year and rolled out a new “Trusted Advisory Program” that offers consultants incentives for getting customers to adopt Thycotic.

Thycotic has brought a new professional services training and certification program to its top solution providers and increased investments in deal registration and lead-generation activities with partners. The company also launched several new products in 2020 that protect access to SaaS applications and IaaS infrastructure while also ensuring remote workers stay productive and secure, the company said.

The company diverted incremental resources to high-performing partner accounts to help accelerate and secure their focus, with the top 5 percent of Thycotic’s partners delivering close to 40 percent of all partner-generated revenue, according to Bob Gagnon’s 2021 CRN Channel Chiefs profile. Manager service provider revenue for Thycotic has grown by 115 percent over the past year, according to Gagnon.

More than half of Thycotic’s deal registrations in the company’s 2020 fiscal year involved cloud-based, channel-sourced recurring revenue, according to Gagnon. Thycotic’s channel organization has particularly enjoyed success in the Federal sector with pipeline growth accelerating by 550 percent on a year-over-year basis, Gagnon said.

PE Hub’s Friday report about Insight Partners preparing to sell Thycotic comes just eight days after privileged access management rival Centrify agreed to be sold by Thoma Bravo to TPG and named Art Gilliland, the former head of Symantec Enterprise, as its next CEO. The sale means that Centrify will have its third owner and fourth top executive in less than three years.

Insight Partners has primarily been a buyer in the cybersecurity market in recent years, scooping up Somerville, Mass.-based threat intelligence vendor Recorded Future for $780 million in May 2019 and Palo Alto, Calif.-based IoT security startup Armis for $1.1 billion in January 2020.

The private equity firm has also invested heavily in fast-growing cybersecurity startups, leading Mountain View, Calif.-based endpoint security vendor SentinelOne’s $120 million Series D round in June 2019 as well as its $200 million Series E round in February 2020. In the email security market, Insight Partners led a $45 million Series C round for San Francisco-based Valimail in June 2019.

More recently, Insight Partners participated in a $100 million Series A funding round for cloud security startup Wiz alongside Index Ventures, Sequoia and Cyberstarts.