Cyber unicorn Claroty preparing to go public at $3.5 billion valuation
Cyber unicorn Claroty preparing to go public at $3.5 billion valuation
The cyber-physical systems protection company secured $100 million in growth financing last month at a valuation of $2.5 billion and is currently meeting with underwriters ahead of a possible IPO in 2025
The series of successful technology IPOs that have taken place on Wall Street recently, along with the renewed hype around the cyber industry, is creating work for underwriters. Calcalist has learned that the Israeli cyber unicorn Claroty has in recent months begun preliminary preparations for an IPO on one of the American stock exchanges - Nasdaq or New York Stock Exchange (NYSE). The preparations include meetings with potential underwriters.
Claroty, which operates in the field of cyber protection for essential enterprises and critical infrastructures, is one of the fastest-growing unicorn companies (that is, private companies with a value of one billion dollars or more), and today it is also one of the few that has managed to raise money in the current challenging time.
Just a month ago, the company announced the raising of $100 million in equity and credit at a value of $2.5 billion. The company refused to confirm the value and only referred to the fact that the fundraising was carried out at a higher value than its previous round at the end of 2021 when it raised money at a valuation of $2 billion.
At the same time as announcing the funding, Claroty announced that it had passed the $100 million mark in annual recurring revenue (ARR) and that its number of customers had grown by 300%. If the company manages to maintain the current rate of growth, then in light of the current pricing levels in the market, it will be able to go public in New York at a value of approximately $3.5 billion in the first half of 2025. To a large extent, the field in which the company operates supports this as well. Claroty operates in the field of physical protection of cyber and Internet of Things (IOT) systems. This is an area that is considered the least saturated in the cyber industry.
Claroty said in response: "An IPO in New York is an important business milestone in the development of the company. The process has not yet begun and we do not yet have a set timetable for the IPO. We will announce this when the time comes. In the meantime, we continue with rapid growth according to our plans."
Claroty was founded in 2015 as the first venture of Israeli VC Team8. Nadav Zafrir, who heads Team8, is also the chairman of Claroty. The founding team of Claroty serves in various positions in the company: Amir Zilberstein and Benny Porat are members of the board of directors and Galina Antova is Chief Business Development Officer.
Claroty currently employs 533 people, of which 260 are based in Israel. The company has raised $735 million to date. In 2021, it raised $400 million in what was one of the largest rounds carried out by an Israeli company. The money was used to purchase the Israeli company Medigate, which specializes in the protection of medical devices - and introduced Claroty into a new field. The giant round in question was led by the Japanese investment giant SoftBank, after which Yossi Cohen, the former head of the Mossad that manages SoftBank's Israeli operations, joined the Claroty board of directors. Among the shareholders in Clarotyare also the American venture capital firms Bessemer Venture Partners and NightDragon, run by Dave DeWalt who serves on Claroty’s board since its inception, the private equity fund Warburg Pincus, Siemens, Schneider Electric, Rockwell, LG, and the investment funds of General Motors and BMW.
Claroty is not the only Israeli high-tech company eyeing an IPO in New York during 2025. According to the latest reports, Shlomo Kramer's Cato Networks, which operates in the SASE (secure access service end) market, has already hired the investment banks Goldman Sachs, Barclays and JP Morgan to lead its IPO. Cato is expected to aim for a value of up to $5 billion after raising funding at a value of $3 billion at the end of 2023.
Snyk, which develops security tools for developers, also plans to go public next year. Snyk will try to aim higher and carry out an IPO at a value of $8 billion, after the last round it carried out was conducted at a value of $7.4 billion.
In both cases these are companies that, like Claroty, do not need cash but want to advance to the next level that will establish their position as the leading companies in their field.
Trading platform e-Toro is also aiming to take advantage of the tide in Bitcoin and complete an IPO after shelving the move following the bursting of the bubble in 2022. The company whose IPO is considered to be the closest to execution is enterprise software company Navan (formally TripActions), which already had a prospectus ready in 2022 aiming for a value of $12 billion.
