Dive Brief:
- Venture capitalists invested $9.5 billion into cybersecurity startups during 2024, marking a 9% increase from 2023, according to Pinpoint Search Group research released Tuesday.
- Security startups raised the combined $9.5 billion last year over 304 funding rounds and 79 M&A deals. Pinpoint Search Group tracked 346 funding rounds and 91 M&A deals in 2023.
- Nearly 60% of funding rounds in 2024 went to early stage security startups, spread across seed and series A rounds. Yet, more than half of all dollars raised went to late-stage rounds.
Dive Insight:
The lookback on cybersecurity funding underscored a continuing trend toward larger deals in the sector. Total funding was up year over year while the number of rounds declined.
That trend largely held on a quarterly basis throughout the year, too, especially in the second half of 2024. Funding reached $2.3 billion over 77 rounds in Q1 and investors narrowed their scope further in Q4, spreading $1.7 billion in total investment across 56 rounds.
Vendor consolidation is also making an impact on the bets investors make in the sector. Large security vendors are assembling end-to-end offerings in response to a glut of point solutions.
Cybersecurity segments that generated the largest combined funding in 2024 include data, identity, AI, detection and response, and vulnerability management.
