Akamai Nears Acquisition of Noname Security for $500 Million

Akamai Technologies is reportedly close to acquiring cybersecurity startup Noname Security for $500 million.

According to a source close to the situation, Akamai Technologies is reportedly in the final stages of negotiations to acquire cybersecurity startup Noname Security, which specializes in API protection, for $500 million.

Oz Golan and Shay Levi, both of Israeli descent, co-founded Noname in Palo Alto in 2020. In December 2021, Lightspeed and Georgian led a $135 million Series C round, bringing the firm’s valuation to $1 billion. The source states that the agreement requires cash payment, even if the sale price falls significantly below that valuation. The agreement is still in its early stages and may or may not go through.

Insight Partners, Cyberstarts, ForgePoint, Next47, and The Syndicate Group are among the other investors who have supported Noname.

Those who put money in early will get a good return on their investment, even though the possible deal price is half of what Noname was worth at its last private valuation. On the other hand, the arrangement should make it possible for later-stage investors, especially those who put money in during the final round, to get their money back, if not the profit they were hoping for back in 2021 when everything was peachy.

According to the source, the acquisition makes the company worth around fifteen times its yearly recurring income. If the sale is successful, around 200 people from Noname will travel to Akamai. 

No comment was made by Akamai. We do not comment on rumors or speculation as a policy, according to a Noname Security official who spoke with the media.

In January, The Information revealed that Noname was attempting to obtain a new round of funding, this time at a much lower valuation. According to the Israeli news site Calcalist, Noname was reportedly in talks with other potential purchasers, including Akamai, in February.

Following the Federal Reserve’s interest rate hikes, the valuations of numerous venture capital-backed companies that had raised funds during the peak of the technology boom plummeted. The financial industry refers to this as a “dual-track process,” where numerous companies are simultaneously seeking purchasers. After over a year of a stagnant IPO market, several later-stage VCs are seeking liquidity. The consensus among venture capitalists is that merger and acquisition (M&A) activity will slow down until strong IPOs emerge again.