Cyber security startups brought in a "record-shattering" $29.5 billion in venture capital spending globally across 2021, according to new data.
The investment total amounts to more than double the number reported in 2020, which was just $12 billion, as reported by financial advisory firm Momentum Cyber.
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The firm said the increase was largely driven by a rise in cyber threats, with notable data breaches and ransomware attacks spread throughout the year. Investors poured a record amount of capital into 1,042 transactions as a result, with 82 of these being greater than $100 million.
A record number of security startups also reached unicorn status, with more than 30 minted by the end of 2021, including Wiz and LaceWork. That's compared to just six startups managing to achieve the same the year before.
IPOs were also up for the year, with companies like Darktrace and SentinelOne helping to raise $2.2 billion on the stock market. Cyber security stocks consistently performed well and even outperformed the NASDAQ, according to Momentum.
"We are entering a new age of cyber security risk that is testing our defences across every commercial and government organisation," said Dave DeWalt, founder and managing director, Momentum Cyber. "It is the responsibility of defenders like us to keep investing in and nurturing innovation to combat this existential threat and ensure a safe and secure future for all."
Separately, the cyber security industry also saw record amounts of money generated via mergers and acquisitions. The 286 transactions in 2021 added up to $77.5 billion, over three times higher than in 2020. The number was inflated by billion-dollar acquisitions, such as the $14.1 billion deal for McAfee.
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2021 will more likely be remembered as a year littered with data breaches and ransomware. There were notable attacks on core infrastructure, such as the Colonial Pipeline and the Irish Health System. This was in addition to large-scale supply chain attacks, such as SolarWinds and Microsoft Exchange.
Looking to 2022, Momentum's report suggests investors will focus on cyber security's "emerging relationship" with cryptocurrency and blockchain.
"While it remains to be seen how these sectors will evolve over the coming year, investors will certainly be paying close attention," the report notes.
