Israel cyber firm Claroty eyes 2025 US IPO at $3.5 billion value, report says

By Thomson Reuters Apr 9, 2024 | 5:44 AM

By Steven Scheer

JERUSALEM (Reuters) – Israeli cyber security startup Claroty is preparing a possible U.S. initial public offering in 2025 at a valuation of $3.5 billion, the Calcalist financial daily reported on Tuesday.

Calcalist, without citing sources, said Claroty was currently valued at $2.5 billion and meeting with underwriters about an offering on Nasdaq or the New York Stock Exchange.

In response, Claroty told Reuters that “the formal IPO process has not yet started, and a definitive timeline is still being formulated”.

Claroty was co-founded in 2014 by venture group Team 8 and Amir Zilberstein. It focuses on protecting critical infrastructure systems such as power grids, steel mills and oil refineries.

Last month, Team8 managing partner Yuval Shachar told Reuters that Claroty would “hopefully be a big IPO” at some point soon, but added the IPO market “isn’t great right now” and that a flotation might not even happen next year.

“It’s hard to tell but when the market for IPOs is back, we will be ready for it,” he said.

In March, Claroty raised $100 million in a private round to bring total funds raised to $735 million, and said in 2023 it surpassed annual recurring revenue of more than $100 million, while working with 20% of Fortune 100 companies.

In early stage Series A and B funding rounds, Rockwell Automation, Schneider Electric and Siemens, among others, invested in Claroty.

Once those investors joined, Team8 opted to keep the startup and build it into a larger company rather than sell it like others in its portfolio. Shachar said that, at the firm’s outset, the market to protect infrastructure, grids and utilities was limited.

“By Series C (funding round) we felt like we are going to be the incumbent in what is now clearly a huge, huge market, defending infrastructure,” Shachar said.

(Reporting by Steven Scheer; Editing by Mark Potter)