Israeli cyber firm Armis acquired for $1.1 billion by Insight Partners

Under the terms of the deal, which is expected to close in February, Armis will continue to operate independently and be led by Israeli co-founders Yevgeny Dibrov and Nadir Izrael.

By EYTAN HALON
(photo credit: HILA BAR DAVID)
(photo credit: HILA BAR DAVID)
American private equity firm Insight Partners has agreed to acquire Israeli-founded cybersecurity company Armis in a deal valued at $1.1 billion, the companies announced early Tuesday.
Under the terms of the agreement, representing the largest acquisition of a private Israeli cybersecurity company to date, Armis will continue to operate independently and be led by Israeli co-founders Yevgeny Dibrov and Nadir Izrael. The deal is expected to close in February.
Founded in 2015, Palo Alto-headquartered Armis offers a platform to manage cybersecurity risks faced by enterprises when adopting Internet of Things (IoT) devices. The platform identifies suspicious or malicious devices and quarantines them to protect critical information.
Malicious actors can target traditional equipment like laptops and smartphones, but also the growing presence of unmanaged smart devices including industrial robots and medical devices.
The companies said software-focused Insight Partners will acquire the company in cash, with participation from Alphabet’s private equity firm CapitalG valued at $100m., and rollover from certain existing stockholders.
Seeking to deepen its presence in the Israeli ecosystem, Insight Partners opened an office in Tel Aviv in October 2019. Prior to the acquisition of Armis, the New York-headquartered venture capital firm – which manages over $20b. in assets – had invested over $700m. in Israeli companies.
“Insight is one of the most sophisticated software investors in the sector, and it is due to the depth of their domain expertise that they really understand the enterprise IoT device challenge we are looking to solve, and the size of the market opportunity,” said Dibrov, who serves as chief executive of Armis.
“We considered growth rounds and strategic offers, but by partnering with Insight we have the best of both worlds – operational support and independence, both of which were important in our decision to take on a scale-up partner this early in our company journey.”
By 2021, Armis reports, 90% of enterprise devices will be unmanaged and unsecured, thereby creating massive security gaps within businesses and organizations. A recent report by Finnish cybersecurity firm F-Secure revealed that attacks on such devices soared by 300% in 2019 alone.
“One of the biggest challenges keeping CIOs and CISOs up at night is how to secure the unmanaged devices proliferating through their businesses, from manufacturing floors to hospital rooms, from airports to boardrooms,” said Izrael, the chief technology officer of Armis.

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“These devices – capturing and creating business critical information, working on production lines, or administering patient care – have no protection and they need a security solution.”
Following the acquisition, Insight founder Jeff Horing, managing director Teddie Wardi and Cyberstarts founder Gili Raanan will join Armis’ board of directors.
“Armis is one of the most ground-breaking enterprise data-centric security solutions that is actively protecting modern businesses today,” said Horing. “Armis has established themselves as the leader in the enterprise IoT security space, and we believe this team and their technology will continue to transform the way unmanaged devices are secured.”