CyActive is one of the very few cyber security outfits on the market that can prevent cyber threats, not just identify and alleviate them. The deal is between $60-$80 million
Today, Globes (in Hebrew) learned that PayPal made its second ever acquisition of an Israeli company. CyActive, which has been incubated by Jerusalem Venture Partners (JVP) at their cyber security lab in Beer Sheva and up until now, only raised $2 million, was bought by PayPal and is expected to materialize in the near future. Calcalist (in Hebrew) reports that the deal is somewhere between $60 and $80 million. Geektime‘s sources claim that the deal is above $60 million, though they say the deal has not been signed and would not specify how much the acquisition will be worth.
Founded in 2013 by CEO Liran Tancman and CTO Shlomi Boutnaru, CyActive predicts and prevents future malware by analyzing past attacks. CyActive is one of the very few cyber security outfits on the market that can completely prevent cyber threats, not just identify and alleviate them, so it is not surprising to us that it was acquired quickly.
It might have prevented the Sony attack
According to Yoav Tzruya, a partner at Jerusalem Venture Partners, CyActive could have helped prevent the Sony attack. For example, it can see if an attack that occurred at another company could be slightly varied to breach your system, and prevents it before the attack could come through. In the case of Sony, Tzruya asserts that the Sony attack was a variant of several other attacks, and that CyActive could have spotted it.
This is the first exit for JVP’s one-year-old cyber security lab, though JVP has one of the longest and most successful track records in Israeli startup exits. Besides JVP, CyActive also received investment from the German company Siemens and another foreign investor before this acquisition.
PayPal’s first Israeli acquisition occurred in 2008, when it bought FraudScience for $169 million. As a result of this acquisition, it set up its fraud control center in Tel Aviv.
Neither CyActive nor JVP were available for comment in response to Globe’s inquiries, nor is it clear how the acquisition will change the future of CyActive’s management.
In the fall, CyActive pitched at Geektime’s Conference. To see how it works, check out this video:
*Update [11:31 a.m., EST, March 10]: PayPal has confirmed its acquisition of CyActive, and also plans to open a new security hub in Israel. The price of the deal is still speculative.