Biz Break: FireEye buys a 'black box' to track hackers' movements
Posted: 05/06/2014 01:07:24 PM PDT
Updated: 05/06/2014 01:11:22 PM PDT
Today: FireEye follows $1 billion Mandiant acquisition with the purchase of a private firm that records all network traffic to track where the bad guys go and what they do.
The Lead: FireEye acquires nPulse to track hackers' movements
FireEye added another soldier to its mission of helming the most complete network-security offering Tuesday, acquiring nPulse Technologies for an undisclosed price to act as its 'black box' to record attacks from nefarious hackers.
The six-year-old Virginia company brings technology that records and searches network traffic, allowing security teams to find and detail the actions of bad actors who breach their networks, giving companies more information about exactly what was taken or affected in an attack.
'With nPulse, when the details matter, you will have those details. It's not something we want to use every day, but when we need to, we've got that flight recorder to interrogate to get the answers,' FireEye Chief Operating Officer Kevin Mandia said Tuesday.
Mandia also came to FireEye in an acquisition, the Milpitas company's $1 billion purchase of Mandiant, which is known for its ability to track and detail hackers who have managed to breach network security. FireEye will now meld nPulse with Mandiant and its own advanced breach-detection technology to offer what it hopes will be the most complete end-to-end network-security offering on the market.
Tuesday's acquisition continues a busy year for FireEye, which went public in September 2013 at a valuation of more than $2 billion, and immediately soared higher on a trajectory that only steepened after the January acquisition of Mandiant.
'It's been a successful run over the last few years -- Mandiant I view as a game changer. Now its about rounding out the overall product strategy and filling in the holes to make sure that FireEye can be the end-to-end security vendor,' FBR Capital Markets analyst Daniel Ives said Tuesday.
With enthusiasm running high, FireEye exercised a giant secondary offering in early March, bringing in more than $1 billion just ahead of a downfall for high-flying tech stocks that has resulted in FireEye shares diving to less than half that price. While FireEye's market cap has been chopped in half in the past two months, it is still more than double the company's IPO valuation, and investors see reasons for bullishness: The company's sales jumped more than 93 percent in 2013, putting it in the top 150 Silicon Valley public tech companies in terms of revenues, at No. 132, before any accounting of Mandiant's addition to the company.
Ives called FireEye's performance on Wall Street so far 'a roller-coaster ride,' but said that company 'needs to continue to prove themselves to investors to show that there's meat on the bone rather than hype.'
The technology FireEye receives has shown to be critical for large companies suffering through a data breach. For instance, when the retailer Target suffered an incursion last year that involved the theft of credit-card information and other data from customers, it took days from the discovery of the breach to the disclosure of what information was taken. Even worse, the company had to announce later that even more information than previously thought had been accessed, and a lack of reliable information led to an inability to accurately recount what was taken, a problem that Mandia said usually leads companies to disclose a higher number than nPulse would show.
'Since we have a record of all the traffic on the network, we have the ability to give you those answers very quickly, so we tie a lot of pieces together,' nPulse CEO Tim Armstrong said Tuesday.
The nPulse team will remain in their offices in Charlottesville, Va., but is expanding into Northern Virginia, near Mandiant's former headquarters, and all its current workers will become part of FireEye. The deal is expected to close in the second half of this year, the companies said in a statement Tuesday.
Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, newsandtalking.blogspot.com, Bloomberg News and other wire services. Contact Jeremy C. Owens at 408-920-5876; follow him at http://ift.tt/1drGiGq.
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