SentinelOne is reportedly acquiring Prompt Security, an Israeli cybersecurity startup, in a deal valued at around US$250 million.

Prompt Security was founded in August 2023 by Itamar Golan, who established AI divisions at Check Point and Orca Security, and Lior Drihem, who was director of innovation at Check Point before joining Orca Security.

The company has raised US$23 million from investors including Hetz Ventures, Jump Capital, Ridge Ventures, Okta, and F5.

Prompt’s platform analyzes interactions with AI tools to detect potential data leaks, block harmful content, and counter AI-specific threats.

🔗 Source: Calcalist

🧠 Food for thought

1️⃣ Cybersecurity M&A activity shows consistent pattern of high-value consolidation

Prompt Security’s rapid $250 million exit after just two years and $23 million in funding reflects a long-established pattern in cybersecurity acquisitions.

Historical data shows that nine cybersecurity companies were acquired for over $100 million in 2016 alone, with three deals exceeding $500 million 1. This demonstrates that substantial valuations for cybersecurity assets have been consistent for nearly a decade.

The trend has accelerated significantly since 2018, with ten billion-dollar cybersecurity exits occurring from that year onward, compared to just 13 total billion-dollar exits in the entire period from 2010-2017 2.

This pattern suggests that Prompt’s valuation, while impressive for a two-year-old company, fits within established market dynamics where cybersecurity solutions command premium prices due to persistent demand for advanced threat protection.

2️⃣ Buyer consolidation strategy reflects broader industry transformation

SentinelOne’s acquisition strategy mirrors a broader shift in cybersecurity from point solutions to comprehensive platforms that began gaining momentum in 2013 1.

Major technology companies have consistently pursued cybersecurity acquisitions to build integrated offerings, with notable examples including Intel’s $7.7 billion acquisition of McAfee in 2010 and Microsoft’s extensive acquisition program spanning over 225 companies since 1986 23.

The current wave of AI cybersecurity acquisitions represents the latest evolution of this consolidation trend, where established security companies acquire specialized AI capabilities rather than developing them internally.

This approach allows companies like SentinelOne to rapidly integrate emerging AI-driven security technologies into their existing platforms, potentially gaining years of development time through strategic acquisitions rather than internal R&D investment.

Recent SentinelOne developments