Tech & Startups

Armor’s $89M Raise Kicks Cybersecurity Firm into Acquisition Mode

CEO of the Richardson company says it is actively seeking businesses that can aid with cloud automation.

 Chris Drake is the founder and CEO of Armor.
Chris Drake is the founder and CEO of Armor.

After locking down an $89 million investment, Richardson-based cybersecurity company Armor is ready to start acquiring companies and talent that will help automate elements of its platform.

The news comes after the company on Wednesday announced its latest round of funding led by ST Telemedia, a Singapore-based investment firm which focuses on funding communications, media, and technology companies. The investment makes ST Telemedia a joint shareholder along with existing majority stakeholder Arkansas-based The Stephens Group. It also gives Armor the capital it needs to strengthen its offerings and help the company go global.

“We want to round out the portfolio—double down on [research and development],” said Chris Drake, Armor CEO and founder from New York, where he’s meeting cybersecurity companies. “That could come from building within or acquiring other companies. We have a nice war chest now.”

Armor, founded in 2009, helps companies prevent security breaches through a managed multi-layer approach. The company, which employs about 250 people, prides itself on going beyond just alerting consumers to possible threats, but also providing intelligence and machine learning from its security operations center. The company says it generates between $50 million and $100 million. With the additional capital, Armor is actively hunting companies in cloud automation.

“In security automation we detect it and put out the fire,” Drake said. “But if we do cloud automation, the cloud allows us to clean the entire environment and rebuild it in minutes.”

It also is interested in companies that are in artificial intelligence, data analutics, and machine learning. Even if the company isn’t a fit for Armor, the team might be, Drake said. So Armor could buy the company simply to acquire its talent.  “If there are ‘devops’ [software development and information technology operations] shops—those kinds of shops near our vicinity we’d be interested in,” Drake said, adding that finding talent for Armor can be difficult. “I’m describing two of the most competitive, high-cost talent pools: cybersecurity and cloud.”

In addition to kicking up merger-and-acquisition activity, Armor plans to use some of the funding to expand its sales and marketing efforts. It also wants to increase its sales through other software providers. Currently, Armor generates 80 percent of its revenue. Drake hopes to flip the equation and generate 80 percent of its revenue through other channels that sell Armor as a packaged deal.

The investment comes at a time when more corporations are pushing cybersecurity higher up on their priority list. With massive breaches hitting some of the largest U.S. companies, Drake sees an opportunity for Armor to continue its fast-paced growth.

“We were early we were ahead of our time,” he said. “CIOs were thinking that detection services were the way to go, and now they’re starting to evolve and say, ‘Now we have to actually respond to everything.’”