Why Cyera Is Eyeing a $400M Funding Round at a $9B Valuation

•
December 17, 2025    

The search for the next generational cyber company has intensified since Wiz agreed in March to get acquired by Google for $32 billion.

See Also: Going Beyond the Copilot Pilot – A CISO’s Perspective

With $1.9 billion in outside funding and a founding team that had run Microsoft’s cloud security unit for many years, Wiz appeared poised to challenge Palo Alto Networks and CrowdStrike’s market share dominance in cloud security. Even if Wiz never reached its lofty nine-figure market caps, it seemed inevitable the company would go public and notch valuations in line with Fortinet, Zscaler or Cloudflare.

But with Wiz out of the picture as an independent company, it wasn’t clear who would be security’s next sure thing. Until now.

Enter Cyera, who in just four years has raised $1.3 billion, the second-largest venture haul for any cyber startup behind only Wiz. Cyera achieved a $6 billion valuation, doubling its market cap in less than seven months. And the company plays in the single hottest cyber market, which has reaped the downstream effects of recent artificial intelligence spending: data security (see: Cyera Doubles Valuation With $540M Raise for AI Data Defense).

Cyera has set its sights even higher in 2026, with The Wall Street Journal reporting Tuesday night the company is set to receive another $400 million – this time from Blackstone – at a valuation of $9 billion. This represents another 50% increase in Cyera’s valuation and would make the company the second-most valuable startup in all of cybersecurity, behind only Wiz, which got a $12 billion valuation last year.

Why Cyera Will Avoid Pitfalls of Other Well-Capitalized Startups

Like Wiz, Cyera’s founding team has an impressive pedigree, with co-founder and CEO Yotam Segev spending nearly a decade in the Israeli military, rising to become head of Unit 8200’s cyber department. Both Wiz and Cyera also have been backed by Israeli incubator Cyberstarts, which got in hot water for offering CISOs $250,000 to provide product feedback and market insights to security startups annually.

Gobs of outside capital and massive valuations don’t guarantee a successful exit. Just ask Lacework, which raised $1.3 billion – the largest funding round in cyber history – on an $8.3 billion valuation, and 33 months later was sold to Fortinet for just $152.3 million. Or Cybereason, whose valuation plummeted from $3.3 billion in July 2021 to just $300 million in April 2023. Last month Cybereason was acquired by LevelBlue.

Even though Cyera has indexed more toward growth than profitability and is now eyeing its fourth cash infusion in just 20 months, the company is different than cautionary tales like Lacework and Cybereason. For starters, those companies reached their funding heights during the 2021 bubble, where newly minted cyber unicorns were a weekly occurrence, while Cyera has been dealing with chastened investors.

Cyera also enjoys a far more favorable competitive landscape. Cybereason was the third horse in a two-horse endpoint security race between CrowdStrike and SentinelOne, while Lacework had to battle both established cloud security startups like Wiz as well as robust incumbents like Palo Alto Networks and CrowdStrike.

Conversely, the longtime data security pure-plays either struggled with more modern approaches or failed to gain escape velocity, other data security startups are either considerably smaller or were acquired as early-stage companies and broader tech or cyber platform providers are pivoting into data security from entirely different disciplines or areas of expertise.

Varonis has been doing data security since 2005, but only has a valuation of $3.85 billion on revenue of $551 million, and in October the firm laid off 5% of its staff after disclosing a sharp drop in renewal rates for its on-premises subscription business. Despite being much smaller with an estimated $100 million in ARR and less than half of Varonis’ headcount, Cyera is now eyeing a valuation more than double that of Varonis (see: Varonis Lays Off 5% of Staff, Stock Plunges as Renewals Drop).

Why Competitive Landscape Made Further Investment a Priority

The other players in Forrester’s data security platform ratings alongside Varonis – which received the top scores of any of the 10 vendors evaluated – were predominantly part of massive tech firms like Google or Microsoft, legacy cyber players such as Forcepoint and Trellix, or conglomerates that bought struggling cyber assets like Broadcom and OpenText. With limited pure-play rivals, Cyera sees an opening.

Since May 2023, seven data security posture management startups have ended up in the hands of broader security or technology vendors, with IBM, Rubrik, Palo Alto Networks, CrowdStrike, Tenable, Netskope and Proofpoint all entering this red-hot market. This wave of consolidation has left Cyera as the largest standalone DSPM firm, and the New York-based firm has cashed in (see: Why Cybersecurity Giants Are Rushing to Acquire DSPM Startups).

Cyera expanded from its heritage in data security posture management into data loss prevention with the $162 million acquisition of Trail Security in October 2024, bringing the company into more direct competition with the likes of Proofpoint, which started in DLP and got into DSPM via M&A. Given that Thoma Bravo paid $12.3 billion for Proofpoint in August 2021, Cyera likely needs more dry powder to compete (see: AI Powers Cyera’s $162M Buy of Data Security Startup Trail).

With Cyera on track to become a full-fledged data security platform, the company also will increasingly encounter data protection players such as Rubrik and Commvault, which grew up in the storage market due to their heritage in backup and disaster recovery but has since shifted their ambitions to cyber. This list also includes Veeam, which this month spent $1.725 billion on DSPM and data privacy player Securiti.

As data security and AI security converge, Cyera will also need money to fend off the first generation of AI security startups including HiddenLayer – winner of the RSAC 2023 Innovation Sandbox contest – and Protect AI – now part of Palo Alto Networks – that want to get more into defending data. Subsequent generations of AI security startups are less mature than Cyera, offering them a first-mover advantage.

Raising this much capital with little regard to profitability is unorthodox since investors recalibrated their expectations for cyber startups in 2022, but Cyera finds itself in an unorthodox market with unorthodox opportunities. If Cyera maintains its momentum, the company will likely find itself ringing the opening bell on the NASDAQ or New York Stock Exchange in a couple years’ time.