Proofpoint buys insider threat management platform startup ObserveIT for $225 million in cash
Cybersecurity provider Proofpoint announced it’s acquiring Boston-based startup ObserveIT for $225 million in cash. ObserveIT’s lightweight endpoint solution helps organizations, particularly large enterprises, identify and eliminate insider threats. ObserverIT developes tools to detect and manage insider threats. Acquisition of ObserveIT is the third for Proofpoint in Israel; the Israel-founded firm has raised $53 million from investors to date.
The acquisition will extend Proofpoint’s leadership in people-centric security and compliance to deliver post-perimeter data loss prevention. The transaction is expected to close late in the fourth quarter of 2019, and is subject to customary closing conditions, including Hart-Scott-Rodino merger review, and any other required regulatory approvals.
Founded in 2006, ObserverIT provides detection and prevention to enable proactive defense against both malicious and negligent user behavior from employees, privileged users, and third parties. ObserveIT previously raised over $50 million in venture funding.
With this acquisition, Proofpoint will extend its data loss prevention (DLP) capabilities with endpoint joining email, CASB, and data-at-rest to form an enhanced enterprise DLP offering. The combination of ObserveIT’s leading lightweight endpoint agent technology and data risk analytics with Proofpoint’s industry leading information classification, threat detection, and intelligence, will give enterprises unprecedented insights into user activity with their sensitive data, wherever it resides.
In tandem, Proofpoint will invest in ObserveIT’s leading insider threat management solution, which empowers security teams to detect, investigate, and prevent potential insider threat incidents by delivering real-time alerts, and actionable insights into user activity in one easy-to-use solution.
“Today’s ObserveIT acquisition underscores Proofpoint’s commitment to providing organizations with people-centric cybersecurity and compliance solutions that protect what matters: their people and the data they have access to, in a post-perimeter, cloud-first world,” said Gary Steele, chairman of the board and chief executive officer of Proofpoint. “Defending data requires the ability to detect risky insider threat behavior and risky user activity, and swiftly mitigate risk across cloud apps, email, and endpoints. We are the only security company that provides organizations with deep visibility into their most attacked people—and with ObserveIT, we will bring to market the first truly innovative enterprise DLP offering in years. We are thrilled to welcome ObserveIT’s employees and customers to Proofpoint.”
More than 99% of today’s cyberattacks require human interaction to work, making individual users the last line of defense as cyber criminals increasingly targeting companies through their employees. With more and more users accessing data from endpoints off the corporate network in both sanctioned and unsanctioned cloud apps, organizations need to ensure they have the most effective people-centric security controls in place to understand how, when, and where users interact with critical data and intellectual property. As highlighted in the 2019 Verizon Data Breach Investigation report, this is particularly critical to avoid data breaches that leverage compromised credentials (29% of total breaches), compromised endpoints (32%), or are perpetrated by malicious insiders (34%).1
Further, as more companies are encouraging their employees to work from anywhere, on any device, enterprise data loss prevention (DLP) must evolve from a legacy, perimeter-based control and compliance checkbox to an intelligent, activity-based solution to detect and respond to risks to data across cloud apps, email, and lightweight endpoint agents.
The integrated DLP platform will deliver real-time detection of the anomalous interactions across people, data, devices, and applications allowing security teams to understand and respond to data being mishandled, whether on a corporate device, in a cloud app like Office 365, or via email.
“Proofpoint’s leadership in people-centric cybersecurity security, broader intelligence, and R&D resources are significant market differentiators and directly complement our ability to quickly detect insider threats and prevent critical information loss,” said Mike McKee, ObserveIT CEO. “We are very excited to join the Proofpoint team and provide customers with even more powerful solutions to mitigate insider threats, decrease incident investigation time, and make sure users don’t intentionally or accidentally send valuable, confidential information externally.”
The integrated solution will become part of the Proofpoint information protection suite and is expected to be available some time in 2020.