Tech

Why investing in cybersecurity is a costly business

Institutional investors are becoming more keen on investing in cybersecurity companies, but doing so is not easy, in part because it's proving costly to do so.

Investors are increasingly interested in the investment appeal of cybersecurity companies. But getting into the space now is not an easy proposition.

Asset prices of firms in the sector have soared, at least in the US.

“We are seeing numbers all over the place,” said Hank Thomas, co-founder and chief executive for US-based investment firm Strategic Cyber Ventures.

He noted that many companies expect to get a series A valuation of five to seven times their annual revenue, and this sometimes rises to up to 10 times. He believes a reasonable valuation is around five times revenue.

While the...

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