Noname Security, a cybersecurity startup that protects APIs, is in advanced talks with Akamai Technologies to sell itself for $500 million, according to a person familiar with the matter.
Nameless was co-founded in 2020 by Oz Golan and Shay Levi and is headquartered in Palo Alto but has Israeli roots. The startup has raised $220 million from venture capitalists and was last valued at $1 billion in December 2021, when it raised $135 million in a Series C round led by Georgian and Lightspeed. Although the sale price represents a significant discount from that valuation, the transaction in its current form would be done in cash, the person said. The agreement is not final and may change or not take place at all.
Other investors who have backed Noname include Insight Partners, ForgePoint, Cyberstarts, Next47 and The Syndicate Group.
Although the potential transaction price is half the valuation of Noname’s last private valuation, those who invested early will receive a significant return on the sale. At the same time, the deal is expected to enable subsequent investors, especially those who invested in the last round, to get a full return on the capital they invested, or even the profit they hoped for in those heady days of 2021 where the money ran out. the situation was fluid and valuations were optimistic.
The deal values the company at about 15 times its annual recurring revenue, the person said. Noname’s approximately 200 employees are expected to join Akamai if the sale goes through.
Akamai declined to comment. A Noname Security spokesperson told TechCrunch: “As a policy, we refrain from commenting on rumors or speculation.”
Information reported in January, Noname was attempting to raise another round of financing at a significantly lower valuation. In February, Israeli news outlet Calcalist reported that Noname was located negotiations with several potential buyersincluding Akamai.
Many venture-backed companies that raised capital at the height of the tech boom saw their valuations plummet after the U.S. Fed raised interest rates. Many are now looking for buyers and a new round of financing simultaneously, what the financial world calls a two-track process. Meanwhile, many early-stage venture capital firms are looking for liquidity after more than a year of frozen IPO markets. So the general mood in the venture capital industry is that if robust IPOs don’t return soon, this will be a time for discount shopping for M&A activity.
