What are the fundraising trends in the cybersecurity market?
Download our beautiful pitch about the cybersecurity market
In our cybersecurity market deck, you will find everything you need to understand the market
The cybersecurity market raised over $31 billion across 500+ equity deals between 2022 and 2025.
2022 was the peak year with $18.7 billion raised, while 2023 saw a 62% drop as the funding environment tightened.
And if you want to better understand this new industry, you can download our pitch covering the cybersecurity market.
Insights
- The top 10 deals captured between 19% and 55% of annual funding each year, showing that cybersecurity investment is increasingly winner-take-most.
- Cloud security and data security combined attracted over $6 billion across four years, making them the dominant investment categories in cybersecurity.
- Israeli startups punched above their weight, capturing roughly 25-30% of global cybersecurity funding despite Israel's small population.
- Average deal size jumped from $25 million in 2023 to $94 million in 2025, reflecting investor preference for proven late-stage companies.
- AI security emerged as a standalone category in 2024, growing from zero dedicated rounds in 2022 to $336 million across 7 deals by 2025.
- Insight Partners appeared in the most deals across all four years, participating in over 20 cybersecurity funding rounds as either lead or co-investor.
- Identity security fragmented into 18 separate deals in 2024 alone, suggesting investors believe this category remains unsettled despite multiple well-funded players.
- The number of mega-rounds above $100 million dropped from 21 in 2022 to 18 in 2025, but those 18 deals captured 70% of total capital in 2025.
- Seed-stage activity remained robust throughout the period, with over 40 sub-$15 million rounds each year feeding the next generation of security startups.
First, how do we define the cybersecurity market?
We define the cybersecurity market as the set of technologies and services whose primary purpose is to protect digital systems, data, and users from cyber threats.
We include security software (such as identity, endpoint, network, cloud, application, and data security), as well as dedicated security services such as managed detection and response, security operations, penetration testing, incident response, and security awareness training.
We exclude general IT infrastructure and services (such as basic hosting, generic backup and disaster recovery, IT outsourcing, and purely physical security) unless they are specifically designed and marketed as cybersecurity offerings.
This is also the definition we use in our pitch about the cybersecurity market.
In our cybersecurity market deck, we have designed useful charts to give you full market clarity
How has funding activity in the cybersecurity market changed over time?
2022 was the most active year with $18.7 billion raised across 156 deals, driven by strong Q1 momentum before macroeconomic headwinds kicked in rather than a single mega-deal.
2023 was the least active year with only $7.1 billion raised, as rising interest rates and tech market corrections caused investors to pull back significantly.
Cybersecurity funding in 2025 reached $6.4 billion, which represents a 13% increase from 2024's $5.7 billion, a 10% decrease from 2023's $7.1 billion, and a 66% decrease from 2022's $18.7 billion peak.
When you exclude the top 1-2 mega-deals each year, the funding trend looks more stable. The baseline activity (excluding outliers) remained between $4-6 billion annually, suggesting consistent investor appetite for mid-market cybersecurity companies even as headline numbers fluctuated.
If you're interested in this industry, please note that we regularly keep in touch and share funding updates for this market on this page, which we keep continuously updated.
We also make quarterly analyses of the funding activity in the cybersecurity market here.
| Year | Number of Deals | Total Raised ($) | Comment |
|---|---|---|---|
| 2022 | 156 | $18.7B | Peak funding year with capital front-loaded in Q1 before macro headwinds hit. Cloud security and identity dominated as 21 deals exceeded $50 million. |
| 2023 | 286 | $7.1B | Funding dropped 62% despite more deals, reflecting smaller average rounds. Investors doubled down on proven leaders while seeding next-gen innovation. |
| 2024 | 106 | $5.7B | Extreme capital concentration with top 3 deals capturing 28% of funding. AI security emerged as a distinct category for the first time. |
| 2025 | 68 | $6.4B | Strongest year since 2022 with 18 mega-rounds above $100 million. AI security dominated investor appetite, capturing over 50% of dollars invested. |
In our cybersecurity market deck, we help you understand how the market is structured
Which startups in the cybersecurity market raised the largest rounds over the last few years?
These startups raised the most over the last years in the cybersecurity market:
- Wiz raised $1 billion in May 2024 because the cloud security leader needed capital for acquisitions and talent as they served 45% of Fortune 100 companies.
- Cyera raised $940 million across two 2024 rounds and an additional $400 million in 2025 because AI-powered data security became the hottest investment category.
- Saviynt raised $700 million in December 2025 because identity governance for human, machine, and AI agent identities became critical for enterprises.
- 1Password raised $620 million in January 2022 as enterprise password management demand surged during the shift to remote work.
- Orca Security raised $550 million in October 2022 because their agentless cloud security approach resonated with enterprises managing multi-cloud deployments.
- Cyera raised $540 million in June 2025 at a $6 billion valuation because data security became essential for enterprises adopting AI.
- ReliaQuest raised $500 million in April 2025 because their AI-powered security operations platform integrated with over 200 cybersecurity tools.
- NinjaOne raised $500 million in February 2025 to fund autonomous endpoint management R&D and the acquisition of Dropsuite.
- Kiteworks raised $456 million in August 2024 because secure content communications became critical for enterprise compliance.
- Armis raised $435 million in November 2025 as a pre-IPO round before being acquired by ServiceNow for $7.75 billion.
And, yes, we do cover most of them in our our beautiful pitch about the cybersecurity market.
In our cybersecurity market deck, we answer all the common questions from investors and entrepreneurs
Is the cybersecurity market shifting toward smaller or bigger deals?
According to our own data, the average cybersecurity deal size across all four years (2022-2025) was approximately $61 million, though this figure masks significant year-to-year variation.
Breaking it down by year: 2022 averaged $120 million per deal, 2023 dropped sharply to $25 million, 2024 recovered to $54 million, and 2025 jumped to $94 million. The shift reflects how cybersecurity investors moved from spray-and-pray funding to concentrated bets on category leaders.
If you exclude the top mega-deals each year (like Wiz's $1 billion round or 1Password's $620 million), the average deal size remains more stable around $30-40 million, suggesting the baseline cybersecurity market supports mid-sized growth rounds consistently.
| Year | Number of Deals | Average Deal Size ($) | Deals Below $2M | Deals Above $50M |
|---|---|---|---|---|
| 2022 | 156 | $120M | 8 | 52 |
| 2023 | 286 | $25M | 28 | 38 |
| 2024 | 106 | $54M | 2 | 30 |
| 2025 | 68 | $94M | 3 | 27 |
| All Years | 616 | $61M | 41 | 147 |
In our cybersecurity market deck, we identify repeatable patterns you can use if you’re building in this market
How concentrated was funding activity in the cybersecurity market?
Cybersecurity funding became increasingly concentrated over the four-year period. In 2022, the top deal (1Password at $620 million) captured only 3.3% of total funding, but by 2024, Wiz's single $1 billion round captured nearly 18% of all cybersecurity dollars invested that year.
The top 10 deals consistently commanded a significant share, ranging from 19% in 2022 to 55% in 2024 and 2025. This winner-take-most dynamic reflects how cybersecurity investors increasingly prefer proven category leaders with $100 million or more in annual recurring revenue over earlier-stage bets.
| Year | Number of Deals | % by Top 1 | % by Top 3 | % by Top 10 |
|---|---|---|---|---|
| 2022 | 156 | 3.3% | 8.4% | 19.2% |
| 2023 | 286 | 4.2% | 10.6% | 24.1% |
| 2024 | 106 | 17.6% | 28.3% | 54.4% |
| 2025 | 68 | 11.0% | 25.7% | 55.3% |
| All Years | 616 | 5.0% | 10.5% | 26.3% |
In our cybersecurity market deck, we track adoption trends and shifts in consumer behavior
Which categories in the cybersecurity market received the most funding?
Cloud security captured the most funding with approximately $6.8 billion across 70+ deals over four years. Cloud security dominates because enterprises rapidly shifted workloads to AWS, Azure, and GCP, creating massive demand for tools like Wiz and Orca Security that can scan entire cloud environments for vulnerabilities.
Identity security ranked second with approximately $4.2 billion across 90+ deals. Identity became critical because credential-based attacks remain the primary entry point for breaches, driving investment in companies like 1Password, Saviynt, and ID.me.
Data security took third place with roughly $3.5 billion across 60+ deals. Data security surged because AI adoption forced enterprises to discover, classify, and protect sensitive information across cloud environments, benefiting companies like Cyera and Kiteworks.
| Category Name | Number of Deals | Total Raised ($) | Startups and Amount |
|---|---|---|---|
| Cloud Security | 70+ | $6.8B | Wiz ($1.6B), Orca Security ($550M), Netskope ($401M), Cato Networks ($835M), Chainguard ($557M) |
| Identity Security | 90+ | $4.2B | 1Password ($620M), Saviynt ($700M), ID.me ($472M), Silverfort ($116M), Semperis ($125M) |
| Data Security | 60+ | $3.5B | Cyera ($1.5B+), Kiteworks ($456M), BigID ($60M), Sentra ($130M), Cyberhaven ($100M) |
In our cybersecurity market deck, we have collected signals proving this market is hot right now
Who are the biggest investors in the cybersecurity market?
Insight Partners is the most active cybersecurity investor, participating in 25+ deals across all four years including Wiz, Torq, Island, Filigran, and Abnormal Security. Insight Partners dominates because the firm built a dedicated cybersecurity practice with deep sector expertise.
Lightspeed Venture Partners ranks second with 15+ deals including Wiz, Cato Networks, Cyera, and Chainguard. Lightspeed consistently backed category-defining cloud and data security companies.
Cyberstarts participated in 14+ deals including Wiz, Cyera, Upwind, and Island. Cyberstarts specializes exclusively in cybersecurity, giving the firm unique deal flow in Israel's security ecosystem.
Sequoia Capital backed 12+ deals including Wiz, Cyera, Island, and Vanta. Sequoia tends to invest in companies that become category leaders.
Accel participated in 11+ deals including Cyera, Filigran, Axonius, and 1Password. Accel has been particularly active in data security and identity.
Disclaimer: this investor list may be incomplete; we focus on publicly disclosed lead and prominent recurring investors, so some frequent minority participants may be underrepresented. “Total funded” does not represent the amount personally invested by an individual investor. Instead, it refers to the aggregate amount raised across all fundraising rounds in which the investor participated.
| Investor | Number of Deals | Total Funded ($) | Examples of startups |
|---|---|---|---|
| Insight Partners | 25+ | $2.8B+ | Wiz, Island, Torq, Filigran, Abnormal Security, Perimeter 81, Cycode, IONIX |
| Lightspeed Venture Partners | 15+ | $2.5B+ | Wiz, Cato Networks, Cyera, Chainguard, Endor Labs, Ermetic |
| Cyberstarts | 14+ | $2.2B+ | Wiz, Cyera, Island, Upwind, Zafran, Oasis, Linx |
| Sequoia Capital | 12+ | $2.1B+ | Wiz, Cyera, Island, Vanta, Chainguard, Zafran |
| Accel | 11+ | $1.8B+ | Cyera, Filigran, Axonius, 1Password, Tines, Snyk |
| KKR | 5+ | $1.5B+ | Saviynt, ReliaQuest, Ontic |
| YL Ventures | 14+ | $600M+ | Grip Security, Cycode, Hunters, Opus Security, Spera, Piiano |
| Greylock Partners | 10+ | $1.4B+ | Wiz, Abnormal Security, Upwind, Cato Networks, Tenzai |
| Evolution Equity Partners | 9+ | $800M+ | Noma Security, Sweet Security, Halcyon, Armis, Talon |
| Ten Eleven Ventures | 8+ | $1.2B+ | ReliaQuest, Aura, Saviynt, Ontic, Vulcan Cyber |
In our cybersecurity market deck, we cover the latest tech updates shaping the market
What are the 2026 narratives around fundraising in the cybersecurity market?
These are the dominant narratives shaping fundraising in the cybersecurity market in 2025 :
- AI security became a standalone investment category, with dedicated rounds for protecting AI workloads, detecting prompt injection attacks, and governing AI agent behavior.
- Non-human identity security (service accounts, API keys, machine identities) emerged as a critical gap, attracting over $200 million across multiple startups like Oasis, Astrix, and Entro.
- Data security posture management (DSPM) became essential as enterprises realized they cannot secure AI systems without first knowing where their sensitive data lives.
- Agentic AI for security operations attracted massive funding, with startups like 7AI raising $130 million to automate SOC analyst work.
- Pre-IPO rounds dominated late-stage activity, with Armis, Island, and others raising $200 million or more rounds in preparation for public listings.
- Software supply chain security continued attracting capital as enterprises worried about malicious code in open-source dependencies.
- Israeli startups maintained their outsized share of funding despite geopolitical concerns, capturing approximately 25-30% of global cybersecurity investment.
- European cybersecurity finally gained momentum, with French companies like Filigran and Italian firm Exein raising significant growth rounds.
- Consolidation deals increased as larger players like ServiceNow acquired Armis and Wiz acquired Dazz, suggesting the market is maturing.
- SMB-focused security platforms attracted attention as investors recognized the underserved mid-market opportunity beyond enterprise sales.
In our cybersecurity market deck, we will give you useful market maps and grids
Related blog posts
- What is the latest update in the cybersecurity market?
- What are the latest news in the cybersecurity market?
- What is the real market size of the cybersecurity market?
- What are the latest funding news in the cybersecurity market?
- Evolution of the funding activity in the cybersecurity market
- Which startups have raised the most funding in the cybersecurity market?
- What are the most valued startups in the cybersecurity market?
