N-able Strengthens Cybersecurity Via $266M Adlumin Purchase

N-able purchased a security operations vendor founded by a former Marine Corps officer to bring IT management, data protection and security into a unified ecosystem.

See Also: Break the Attack Chain with XDR

The Boston-area MSP platform provider said its acquisition of Washington D.C.-based Adlumin for up to $266 million will give IT professionals access to robust threat detection, threat intelligence, ransomware prevention and compliance automation expertise. Adlumin has $22 million in annual recurring revenue, is growing at 60% annually, and will benefit from cross-selling opportunities and bundling with N-able.

“Our customers have been telling us for some time that cloud-native XDR and MDR solutions are mission-critical to their ability to fully secure their customers and users—which solidified our decision to partner with, and now, acquire Adlumin,” said N-able CEO John Pagliuca. “We’ve proven out customer demand with robust growth and determined that we could scale our business faster if we owned it.”

Adlumin was founded in 2016, employs 149 people, and has raised $101.3 million in four rounds of outside funding, including a $70 million Series B funding extension in October 2023 led by Syn Ventures. The company was started by Johnston, who led the probe into the Russian Foreign Intelligence Services’ breach of the Democratic National Committee during his nearly eight years in the Marine Corps (see: Adlumin Raises $70M, to Debut RMM, Cloud Configuration Tools).

N-able will pay between $236 million and $266 million for Adlumin, consisting of $100 million in cash at close, 1.57 million shares of N-able stock at close, another $120 million in cash over the next two years, and up to $30 million in potential payments based on the achievement of certain performance metrics. The company’s stock is up $0.33 – or 3.25% – to $10.49 per share in after-hours trading Wednesday.

“By integrating Adlumin’s advanced security solutions with N-able’s robust IT management platform, we are poised to deliver unparalleled value to our customers, empowering them to proactively manage their IT infrastructure while fortifying their security posture and mitigating threats,” Johnston wrote on LinkedIn Wednesday.

What Adlumin Brings to the Table

The integration of Adlumin’s cloud-native XDR and MDR into N-able’s platform is expected to streamline operations for MSPs and IT teams, with the firm’s open architecture delivering seamless data integration across endpoints, SaaS applications and networks. The deal addresses the increasing overlap between IT and security operations by uniting Adlumin’s security solutions with N-able’s IT management platform.

“Adlumin is an open platform that ingests data from the network, cloud, endpoints, SaaS applications, employee and system logs, allowing technicians to see and act broadly across their full IT environment,” Pagliuca said. “This enables comprehensive risk mapping and focused remediation efforts. Without the ability to see and interact cleanly with the entire IT estate, technicians are playing a losing game of Whack-a-Mole.”

The integration of Adlumin’s platform will enable MSPs and IT professionals to deliver robust security operations with fewer false positives through end-to-end detection, investigation, and remediation. N-able said Adlumin’s XDR and MDR services will also help mitigate talent shortages in the cybersecurity sector by providing around-the-clock outsourced monitoring as well as automated remediation (see: Adlumin’s Global Expansion: CEO Talks Midmarket Security).

“We have carefully evaluated the competitive landscape and firmly believe the breadth of data sources Adlumin’s XDR software aggregates is a competitive differentiator that provides better outcomes to our customers,” Pagliuca told investors Wednesday.

The acquisition is slated to be immediately accretive to annual recurring revenue growth, with long-term contributions to cash flow expected by late 2025. Adlumin’s over 800 clients come from companies of all sizes and will help N-able enter the $163 million cybersecurity services market. The deal will help N-able expand sales channels, optimize bundling strategies, and leverage Adlumin’s reseller relationships.

“Even when the right human talent is found, it can often be cost prohibitive,” Pagliuca said. “Adlumin elegantly addresses this by providing outsourced labor, which allows IT professionals to augment their operation efficiently with incredibly simple activation and built-in automated remediation. MDR offers 24/7 SOC capabilities, giving customers the health and expertise they need to combat threat fatigue.”

Adlumin is just N-able’s second acquisition since getting spun off from publicly traded IT management software firm SolarWinds in July 2021. The company most recently purchased Dutch Microsoft 365 management and automation platform Spinpanel for up to $20 million in July 2022 (see: Why Barracuda Networks Is Eyeing MSP Platform Vendor N-able).