Fortinet To Acquire Cloud Security Unicorn Lacework, Bolster SASE Platform

Terms of the acquisition deal for Lacework, which had once been valued at $8.3 billion, weren’t disclosed.

Fortinet announced Monday it has reached an agreement to acquire cloud security firm Lacework in a significant consolidation deal for the cybersecurity industry.

The terms of the deal, which is expected to be completed in the second half of the year, were not disclosed.

In a news release, Fortinet said that it would integrate capabilities from Lacework’s CNAPP (cloud-native application protection platform) into its Unified SASE offering.

The combination will offer partners and customers “one of the most comprehensive, full stack AI-driven cloud security platforms available from a single vendor,” Fortinet said in the release.

The release includes a quote from Lacework CEO Jay Parikh but does not specify if he will be joining Fortinet. CRN has reached out to Fortinet for further comment.

Lacework offers a data-powered cloud security platform that collects and analyzes data from across cloud environments and supplies customers with key insights, such as around threat prioritization. The platform is powered by Lacework’s Polygraph machine learning engine that aims to significantly reduce alert volumes while identifying the most pressing cyber threats.

Lacework had raised $1.8 billion in funding and for several years had ranked among the top-valued cybersecurity unicorns, with a valuation of $8.3 billion achieved in 2021.

Prior media reports had suggested that cloud security vendor Wiz was in talks to acquire Lacework for a small fraction of the company’s prior valuation, but there was no indication of the terms of Fortinet’s deal in the release issued Monday.

The acquisition deal comes less than a year after Lacework hired a new CRO, former VMware veteran Kevin Kiley. In a recent interview with CRN, Kiley had said Lacework was in “growth mode” and that he believed Lacework to be an IPO-caliber company. “Without any hesitation, this is something that we certainly have an eye toward,” he said.

Lacework was also notable for being the third company to launch out of private equity firm Sutter Hill Ventures, following an incubation model that had earlier produced Pure Storage and Snowflake.

The company was founded in 2015 and Parikh had previously been Facebook's vice president of engineering.

Indicators of Lacework’s struggles surfaced as far back as May 2022, when the company laid off 20 percent of its staff just months after raising a $1.3 billion funding round. Several months before the layoffs, Lacework had disclosed having more than 1,000 employees.