Avalor's security-data startup bet ends in a reported $310M Zscaler acquisition

Avalor built a security data platform that aggregated, normalized and de-duplicated risk data from virtually any source, tracking and prioritizing vulnerabilities from discovery to remediation.

That aggregating every enterprise security signal into one normalized source of truth would let teams prioritize what to fix first.

$30M raised from TCV, Salesforce Ventures, Jibe Ventures and Cyberstarts.

Kfir Tishbi and Raanan Raz had worked together at Datorama, a marketing analytics company, leading up to and after Salesforce's 2018 acquisition of it; Tishbi had led Datorama's engineering team. They founded Avalor in 2022 to act as a source of truth for cybersecurity assets, controls, identities, vulnerabilities and bugs.

Avalor raised $30M from investors including TCV, Salesforce Ventures, Jibe Ventures and Cyberstarts, and grew to roughly 80 people spread across the US and Israel. The concept was not unique — Securiti and Dig Security attacked the same problem — but Avalor stood apart in ingesting data from virtually any source in any format, and in its vulnerability risk management and prioritization tooling.

Zscaler acquired Avalor on 14 March 2024 for a reported $310 million in cash and equity, 26 months after founding — Zscaler's third acquisition after Canonic and Trustdome. The ~80-person team continues to operate as a complete Avalor unit inside Zscaler.

Zscaler's thesis was that security AI needs enterprise data context, and its security cloud held the most relevant data to train security-specific large language models.

Avalor's edge — data from virtually any source in any format — complemented Zscaler's platform for incident reporting, asset discovery and data classification.

For Avalor, joining Zscaler meant 7,000 customers and 4,200 channel partners it would have taken years to develop organically.

The exit landed in a stagnant cyber M&A market: 66 VC-backed cybersecurity deals in all of 2023, and only 18 by mid-March 2024.

It marked Zscaler's third startup acquisition, after SaaS-protection startup Canonic and cloud entitlement platform Trustdome.

A tool that normalizes data from any source becomes strategic infrastructure for whoever owns the customer; for a 26-month-old startup, selling to that platform beat waiting out a frozen M&A market.

As of 14 March 2024, Avalor's ~80-person team was set to keep operating as a complete unit inside Zscaler, with its data platform feeding incident reporting, incident mitigation, asset discovery, data classification and security policy generation. Crunchbase's Chris Metinko grouped the deal with moves by Wiz, SentinelOne and CrowdStrike as a possible spark for a slow-to-stagnant cyber M&A market that had managed only 18 deals so far that year.