Israel-based and Nasdaq-listed cybersecurity company CyberArk has launched a $30 million venture capital fund that will invest in early-stage cybersecurity startups.
The new fund, CyberArk Ventures, will back startups from seed stage through Series A. It has already put money into three companies—Dig Security, Enso Security and Zero Networks. It will effectively be an in-house fund, which will be backed by the company itself. It will not be a free-standing subsidiary of the company.
The company, which has a market capitalization of $4 billion, has cash reserves of around $1.2 billion, which it is looking to deploy.
Dig Security provides real-time threat detection solutions in public clouds while Enso Security is an app security manager. Zero Networks works in the field of identity management, which is also what CyberArk itself does.
The new fund will make investments jointly with other venture capital funds that specialise in cyber investments into companies in Israel and outside. These are YL Ventures, Team8 Capital, Merlin Ventures, and Venrock.
Interestingly, YL Ventures itself launched a $400-million VC fund earlier this month to invest in cybersecurity startups.
CyberArk Ventures will be headed by Yael Nishry, a director in the company’s business development team. Nishry will head the Israel leg of the fund, while the fund as a whole will be managed by Clarence Hinton.
“As singular cybersecurity investors ourselves, our collaborative relationship with CyberArk comes naturally,” said Ofer Schreiber, a partner at YL Ventures. “We both have extensive experience with guiding cybersecurity innovators with go-to-market in their startup journey and helping them grow into tomorrow’s global industry leaders.”
Hinton said that CyberArk’s channel partners could benefit in the long run from new security products they can offer customers, thus strengthening their channel positions in the market.
At present, 30% of CyberArk’s revenues come from direct sales and 70% from indirect sales. In the first quarter of 2022, CyberArk reported revenue of $127.6 million, up 13% from a year earlier.