The availability of venture capital for cybersecurity firms in 2023 is a question that has been raised due to the current political and economic conditions. Munich Re Ventures' Investment Principal, Sidra Ahmed, explains that funds are typically deployed over the first four or five years of a fund's life, meaning that there is still money available for investment. Yoav Leitersdorf, Managing Partner at YL Ventures, states that their $400 million fifth fund has been used to invest in only a few companies, all of which are still in stealth. VCs will be more careful when it comes to where they invest their funds, as they need to demonstrate value to their LPs. Startups that are able to manage costs and allocate capital to growth opportunities with high potential for returns will be prioritized. DataTribe's MD, John Funge, believes that it will be a difficult period for startups to raise money, as venture firms will be more selective in their investments. He also states that there will be a flight to quality and the bar for attracting funding will be higher. Despite this, there is still a lot of capital available for attractive startups, and large security vendors are strengthening their corporate development divisions and doubling down on in-house investment funds. VC firms will be driven to use their dry powder on their own existing portfolios, and the penalties for data breaches are increasing, making it a priority for companies to be sufficiently protected. In conclusion, while it may be more difficult to acquire venture capital in 2023, it is still possible.
This Cyber News was published on www.securityweek.com. Publication date: Fri, 03 Feb 2023 16:55:03 +0000