Cybereason crisis continues with dozens of jobs to be cut in third round of layoffs
Cybereason crisis continues with dozens of jobs to be cut in third round of layoffs
After being on the verge of an IPO in 2021, Cybereason has since seen its CEO resign, hundreds of employees get laid off, all while experiencing a 90% drop in value from $3 billion to $300 million
Cybereason is set to cut dozens of jobs in what would be the third round of layoffs at the cybersecurity company. In previous waves of layoffs, the company terminated the employment of hundreds of employees. These layoffs are part of a significant reorganization that the company is undergoing, including a new strategic plan. As a result, Zohar Alon, who was appointed as President of Product and R&D less than a year ago, will also be leaving the company.
After being on the verge of an IPO in 2021, Cybereason has since seen its CEO resign, hundreds of employees get laid off, as well as effectively get taken over by its main investor SoftBank, all while experiencing a 90% drop in value.
Established in 2012 by Lior Div, Yonatan Striem-Amit, and Yossi Naar, Cybereason competes with companies such as Crowdstrike and SentinelOne, offering a variety of services including ransomware protection and prevention of malware attacks.
Throughout its 11 years of operation, the company has raised $850 million, with the main investor being SoftBank. A significant achievement for the company was the company's funding round in 2021, in which it raised $325 million, led by former U.S. Treasury Secretary Steven Mnuchin’s investment fund Liberty Strategic Capital. Neuberger Berman, Irving and SoftBank also participated in the round. The company was ultimately valued at approximately $3.1 billion and even filed a prospectus for an IPO that year, expecting a valuation of $5 billion.
However, the economic turmoil of 2022 caught the company by surprise and changed its trajectory. Amidst a global economic downturn, Cybereason, which at its peak employed about 1,500 workers, was forced to concede that it had over-hired employees. What's more, SoftBank, which was hit hard by its massive investment in WeWork, made it clear to all companies in which they invested that they would need to make immediate and massive cuts. Cybereason has since carried out two large rounds of layoffs, parting ways with a total of more than 300 employees, in addition to further significant cuts.
In April of last year, it raised $100 million from SoftBank and Lior Div announced that he was resigning as CEO, and would be replaced by Eric Gan, a SoftBank executive with deep knowledge of the company. Div said that the company had enjoyed an excellent final quarter and that he was resigning because he wanted to focus on a new venture. However, according to a Delaware stock authorization form first noticed by Nasdaq Private Market and reported by Axios, the new Series G shares were sold at a price more than a 90% lower than the round in 2021, meaning the company was being valued at between $300-400 million.
