Akamai to Pay $600M for Ransomware Mitigator Guardicore


By: Mary Jander

Akamai (Nasdaq: AKAM) plans to buy cybersecurity startup Guardicore for an estimated $600 million in cash, in a deal Akamai hopes will lead to the next level of enterprise zero-trust services.

Guardicore offers a product called the Centra Security Platform designed to halt ransomware. It deploys software-defined micro-segmentation along with visualization technology to control communication between applications in an enterprise network. Centra’s software agents communicate with a central controller, either in a network host or via cloud-based software-as-a-service (SaaS), to open communications with other apps only if permitted. The solution works consistently across clouds, including AWS and Azure. If malware is detected, communications are shut down. Security personnel can set policies, alerts, and other controls through the visual interface.

According to Akamai, Guardicore’s technology is an “east/west” approach to zero trust that dovetails with Akamai’s “north/south” access controls, so that when the services are integrated, the result will be a “north/south-east/west” solution. “We’re so excited about the fit with Guardicore,” said Tom Leighton, Akamai CEO and co-founder, in a webcast briefing with financial analysts. “Not only does it stop ransomware, but their east/west solution fits very nicely with our north/south solution, and that’s where we think the future of zero trust is going … the combination.”

Akamai’s Biggest Acquisition Since Prolexic

The Guardicore acquisition is the largest Akamai has undertaken since it bought distributed denial of service (DDoS) mitigation firm Prolexic for about $400 million in 2013. According to CEO Leighton, the motivation now is the same as then: To add a significant capability to Akamai’s security product and service lineup. The deal follows the evolution of content delivery networks (CDNs) such as Akamai’s into broader enterprise services, including secure access service edge (SASE) implementations.

CEO Leighton says the Guardicore buy isn’t meant to signal any interest by Akamai in continuing with large acquisitions, however. It’s an unusual and strategic step for the company, which is known for buying up small companies in “tech tuck-ins.”

Guardicore’s All In with Akamai

Privately held Guardicore was founded in Tel Aviv in 2013 by Pavel Gurvich (now CEO), Ariel Zeitlin (now CTO), and Dror Sal’ee (now VP APAC). Gurvich and Zeitlin worked together in cybersecurity in the Israeli Defense Forces, and Sal’ee hailed from Apple (Nasdaq: AAPL), where he served as a marketing manager. All three, along with Guardicore’s other estimated 300 employees, will be joining Akamai’s Security Technology Group once the deal closes, which should be by the end of this year, execs say.

Guardicore raised $110 million in three rounds of funding, the most recent of which appears to have been $60 million in Series C in 2019. Investors include Qumra Capital, DTCP, Partech, Access Industries’ ClalTech, Battery Ventures, 83North, TPG Growth, and Greenfield Partners.

Guardicore claims approximately 300 customers, including Cellcom, Deutsche Bank, Frontier Airlines, Santander, Staples, and Teleflora, to name a few. Guardicore’s revenues have been roughly doubling for the past couple of years, execs say. Today, about 40% of Guardicore customers have term licenses with the vendor, which Akamai plans to shift to the cloud model as soon as possible.

Akamai’s Guardicore Game Plan

Guardicore’s Centra solution will first be integrated with Akamai’s remote work security wares, including Enterprise Application Access (EAA). The addition of Guardicore, says CEO Leighton, should add $30 million to $35 million to company revenues in 2022 and more than double security segment sales within the next few years. Of course, the deal will bring operating margins to between 29% and 30% (compared to last quarter’s 32% margin), though management hopes to return to at least 30% by 2023.


Akamai’s choice of Guardicore, which competes mainly with Illumio and incumbent access security suppliers such as Palo Alto Networks (NYSE: PANW), Fortinet (Nasdaq: FTNT), and Check Point Software Technologies (Nasdaq: CHKP), seems to be an inspired move. The challenge will be integrating Guardicore without sacrificing the startup’s successful culture. Guardicore, after all, wasn’t ready to be acquired, and according to Tom Leighton, it took a while for the deal to catch fire. If all goes as planned, though, this acquisition could lever Akamai’s enterprise security services onto a new plane.