Cybersecurity Funding Declines in Q3 2024: Pinpoint Search Group Report Suggests VC Funding Stabilization

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Oct 15, 2024, 08:42 ET

GRAND JUNCTION, Colo., Oct. 15, 2024 /PRNewswire/ -- Pinpoint Search Group, a leading cybersecurity recruitment firm in the U.S., has released the findings of its Q3 2024 cybersecurity funding report. The report shows a decline in both the number of transactions and the total funding raised compared to Q3 2023. The findings also suggest that venture capital funding for cybersecurity vendors is stabilizing.

In Q3 2024, Pinpoint Search Group's research team recorded 86 transactions in the cybersecurity vendor space, totaling $2.15 billion across 73 funding rounds and 13 M&A events. This represents approximately an 18 percent decrease in transaction volume from 89 in Q3 2023 and a five percent decrease in fundraising from the previous year's $2.3 billion.

Despite the year-over-year decline in the number of transactions and total funding raised in Q3 2024, venture capital funding for cybersecurity vendors seems to be stabilizing following the highs of 2021 and the slowdown in 2022. Over the past nine quarters, vendors have consistently raised between two and three billion dollars, reflecting a more steady and sustainable funding trend.

"During the funding peaks of 2021 and 2022, many in the industry wondered when the other shoe would drop," said Mark Sasson, founder and managing partner of Pinpoint Search Group. "The funding levels at the time seemed unsustainable and potentially harmful to the industry's long-term health. Now, after the slowdown, we've seen a return to stability over the past nine quarters, in contrast to the volatile swings experienced during 2021 through mid-2022. This trend is a positive sign for founders and industry professionals, offering a more sustainable outlook for cybersecurity funding."

The demand for cybersecurity innovation continues to rise, with substantial year-over-year funding directed toward early-stage vendors. In Q3 2024, this trend held steady, as 59 percent of all venture capital investments were allocated to Seed and Series-A startups, representing the majority of funding rounds recorded for the quarter.

During the same period, late-stage funding rounds (Growth Funding and Series C, D) accounted for 13.5 percent of the total funding volume. Despite the lower volume, these late-stage rounds represented a significant 60 percent of the total funding dollars raised during the quarter, highlighting the continued importance of larger investments in mature companies.

A full copy of Pinpoint Search Group's Q3 2024 report on cybersecurity funding can be found here.

About Pinpoint Search Group
Pinpoint Search Group is a leading cybersecurity recruitment firm and specializes in filling vice president, director, and senior individual talent. Pinpoint's collective experience recruiting hundreds of candidates in all segments of cybersecurity provides the company with the credibility to communicate with, qualify, and place professionals in today's most competitive area of technology. Pinpoint also produces Cybersecurity M&A and Vendor Funding Reports highlighting M&As and funding in the cybersecurity space monthly, quarterly, and annually.

Media Contact:
Christopher Joseph (CJ) Arlotta
CJ Media Solutions, LLC for Pinpoint Search Group
C: 631-572-3019
[email protected]

SOURCE Pinpoint Search Group