Cybereason has reportedly filed for an initial public offering (IPO) at a valuation of $5 billion.

According to Reuters, the company confidentially filed for an IPO at that valuation. It cites people familiar with the matter.

Former U.S. Treasury Secretary Steven Mnuchin’s investment firm Liberty Strategic Capital is one of Cybereason’s investors.

Cybereason reportedly has finalized underwriters for its IPO, which could come in the second half of the year.

“As a private company we don’t comment on rumors or speculation, and we appreciate your understanding,” a Cybereason spokesperson said.

Top Competitors Already Public

Rik Turner is principal analyst at Omdia, which shares a parent company with Channel Futures (Informa). He said Cybereason has been threatening to file for an IPO for some time. In a sense, it’s playing catch-up. Its two most high-profile competitors in endpoint detection and response (EDR) are already public. CrowdStrike has been public since 2019 and SentinelOne went public last summer.

Omdia’s Rik Turner

“To keep up in terms of tech development, innovation and market development/headcount, etc., it therefore needs to be public or else look at yet another venture capital (VC) funding round on top of the $714 million it has already raised, having most recently announcing a $50 million add-on to its Series F in October last year, when Google Cloud became an investor,” he said. “That was also when Cybereason and Google announced their partnership, where Chronicle underpins Cybereason as the data lake for all the telemetry to be analyzed by the EDR platform.”

Going public could allow Cybereason to further broaden its offering via acquisitions, perhaps taking it more into the extended detection and response (XDR) space, Turner said.

Smart Move For Cybereason’s Investors

Going public is a smart move for Cybereason’s existing investors, Turner said. They now have “an exit strategy which hopefully will reward them handsomely, assuming the 2022 market is as buoyant for new cyber vendors going public as 2021 was.”

“And as for cons against all these pros, I’d say the main one is the tyranny of the financial analysts and the quarterly results cycle, from which you are shielded while you are private,” he said. “If Cybereason enjoys boisterous growth rates, however, it should be fine. Slip up for a couple of quarters, however, and private equity will start sniffing around to see whether it can pick the company up for its own ends (i.e. asset stripping, re-engineering or whatever). See Proofpoint, Mimecast, FireEye and McAfee. For now, though, I think it’s nowhere near that scenario and [Cybereason] should enjoy significant success as a public company.”

Last month, Cybereason launched its new Pay As You Grow (PAYG) program for MSSP partners, providing financial flexibility to increase margins and profitability. PAYG is available for elite and premier Cybereason MSSP partners. It offers several tiers designed to help them grow their business depending on their business goals for today and tomorrow.