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The Demand for Cybersecurity Sets the Tone for SentinelOne’s IPO

Written by Monica Savaglia
Posted June 22, 2021

This year we have heard more talks about the importance of cybersecurity. Those talks need to become a reality as the number of data and security breaches and hacks is on a rise. Especially as technology advances and our dependence on technology continues to grow drastically. 

We incorporate technologies into our daily lives and sometimes don’t think twice about the data that we are giving up or allowing access to. There’s this high level of trust between us and the technology companies — we believe that they'll protect us and our information. That's not to say these companies aren’t doing their best to protect the information that they get from their users...

But this isn't only about users’ personal information. In the past few months, there have been hacks that have had detrimental effects on American supply chains. JBS is an American food processing company that endured a ransomware attack and paid $11 million to the cybercriminals involved. Before the JBS ransomware attack, there was an attack on one of Colonial's pipelines — the largest pipeline system for oil in the U.S., in fact.

These ransomware attacks were significant and brought attention to how vulnerable some companies can be. A market report from Grand View Research had the global cybersecurity market valued at $167 billion in 2020 and is expected to have a CAGR of 10.9% from 2021–2028. That report also said:

The infrastructure protection segment dominated the market in 2020 with a revenue share of more than 27%. The adoption of IoT and connected devices, to record and share real-time data over the internet, has significantly increased across industries/sectors such as oil, energy, manufacturing, transportation, and telecom. Protecting such infrastructures from online attacks and disasters is of paramount importance. 

The Growing Demand for Cybersecurity

Cybersecurity isn’t just about protecting the data of an individual or laptops and other devices. Cybersecurity offers protection for networks, especially vital networks like the ones that are involved in major industries/sectors that need the it because, as we got a glimpse last month, those hacks affect not only the company involved but possibly crucial supply chains and even the prices that Americans pay for those goods. 

With the Colonial pipeline ransomware hack, people along the East Coast were panic-buying, and that had prices of gas surging. Eventually, these types of attacks on these companies and their networks trickle down to the everyday American. Security needs to be able to keep up and embrace technology and its newest innovations. Technology enriches our world and is intertwined with many important sectors like health care, finance, transportation, public services, or our jobs.

It’s time to get serious when it comes to cybersecurity, and I think these recent issues have moved it to the forefront.

The recent attention on the need for cybersecurity has set the tone for what could be a successful IPO for one cybersecurity company. The company is called SentinelOne.

SentinelOne is headquartered in California and was founded in 2013 by Tomer Weingarten, Almog Cohen, and Ehud Shamir. It filed its IPO paperwork on June 21 with the SEC. Inside the company’s IPO prospectus, it said:

We pioneered the world’s first purpose-built AI-powered extended detection and response, or XDR, platform to make cybersecurity defense truly autonomous, from the endpoint and beyond.

Our Singularity Platform instantly defends against cyberattacks — performing at a faster speed, greater scale, and higher accuracy than possible from any single human or even a crowd.

SentinelOne had some attractive growth — growing by over 100% in the fiscal year 2021. In its most recent quarter, revenue growth increased to 108% year over year — the company reported $37 million for the first quarter in the fiscal year 2022. SentinelOne is betting big that the demand for cybersecurity platforms will rise in the years to come as cyberattacks become more sophisticated and the increased volume of enterprise data.

Some of SentinelOne’s clients include Aston Martin, Nvidia, Estée Lauder, and Wells Fargo. Major competitors of the company include CrowdStrike (NASDAQ: CRWD), Microsoft (NASDAQ: MSFT), and McAfee (NASDAQ: MCFE). SentinelOne’s most recent valuation after its latest funding round was at $3 billion, and after its IPO it is aiming for a valuation of $7 billion. It plans to use the money raised from IPO for business purposes and possible acquisitions of companies or technologies.

SentinelOne is set to list on the NYSE under the ticker symbol “S.” As of right now it has an IPO price target near $26–$29 per share and is expected to put 32 million shares up for sale.

SentinelOne’s public debut is anticipated to be at the end of the month, on Wednesday, June 30. 

To stay updated on SentinelOne’s expected IPO, other upcoming IPOs, and news on the IPO market, click here.

Until next time,

Monica Savaglia Signature Park Avenue Digest

Monica Savaglia

Monica Savaglia is Wealth Daily’s IPO specialist. With passion and knowledge, she wants to open up the world of IPOs and their long-term potential to everyday investors. She does this through her newsletter IPO Authority, a one-stop resource for everything IPO. She also contributes regularly to the Wealth Daily e-letter. To learn more about Monica, click here.

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