API startup Noname Safety nears $500M deal to promote itself to Akamai

Noname Safety, a cybersecurity startup that protects APIs, is in superior talks with Akamai Applied sciences to promote itself for $500 million, in accordance with an individual aware of the deal.

Noname was co-founded in 2020 by Oz Golan and Shay Levi and is headquartered in Palo Alto however has Israeli roots. The startup raised $220 million from enterprise buyers and was final valued at $1 billion in December 2021 when it raised $135 million in a Sequence C led by Georgian and Lightspeed. Whereas the sale worth is a major low cost from that valuation, the deal because it at present stands could be for money, the particular person mentioned. The deal will not be ultimate and will change or not occur in any respect.

Different buyers who’ve backed Noname embrace Perception Companions, ForgePoint, Cyberstarts, Next47 and The Syndicate Group.

Whereas the potential deal worth is half the valuation than Noname’s final non-public valuation, those that invested on the early stage will obtain a significant return from the sale. In the meantime, the deal ought to enable the later-stage buyers, notably those that invested within the final spherical, to get a full return on the capital they put in, if not the revenue that they hoped for throughout these heady days of 2021 when cash was flowing and valuations have been optimistic.

The deal values the corporate at about 15X annual recurring income, the particular person mentioned. Noname’s roughly 200 staff are anticipated to transition to Akamai if the sale closes. 

Akamai declined remark. A Noname Safety spokesperson informed Information World, “As a coverage, we chorus from commenting on rumors or hypothesis.”

The Data reported in January that Noname was making an attempt to boost one other financing spherical at a considerably decrease valuation. In February, Israeli information outlet Calcalist reported that Noname was in negotiations with several potential buyers, together with Akamai.

Many VC-backed firms that raised capital on the peak of the tech increase noticed their valuations crater after the U.S. Fed raised rates of interest. Many at the moment are concurrently in search of consumers and a brand new spherical of funding, identified within the finance world as a dual-track course of. In the meantime, many later-stage VCs are in search of liquidity after greater than a yr of a frozen IPO market. So, the final temper within the enterprise business is that, if strong IPOs don’t return quickly, it will likely be discount procuring time for M&A exercise.