Enterprise security vendor Proofpoint is expanding its capabilities and presence among SMBs with its planned acquisition of Hornetsecurity Group, a European vendor that specializes in protecting smaller businesses running Microsoft 365 and doing so with the help of MSPs.
Proofpoint executives see bringing Hornetsecurity into the fold as a way to complement its enterprise-grade security capabilities with tools aimed at helping an SMB market that is finding itself under increasing attack from cybercriminal gangs and nation-state groups.
The Sunnyvale, California-based company wants to grow Hornetsecurity’s capabilities and, in turn, expand its own reach, according to Proofpoint CEO Sumit Dhawan.
“We plan to bring the power of the Hornetsecurity platform to our MSP partners globally and intend to increase the investments in the Hornetsecurity partner program, adding more resources to support MSP partners globally, including Europe and the U.S.,” Dhawan
wrote in a blog post. “This acquisition gives customers across all sizes and managed service providers the best purpose-built solution with the highest efficacy and protection from Proofpoint, their one-stop shop for human-centric security.”
SMBs in the Hacker Crosshairs
SMBs find themselves under increasing threat, with global consultancy Accenture noting that
43% of cyberattacks are aimed at smaller businesses while only 14% of them can adequately defend themselves. There are myriad reasons why, according to password management firm LastPass.
“As the global economy has shifted towards digital operations, a corresponding rise in cyberattacks has followed,” the company
wrote in a blog post, noting that the Accenture figures on the volume of attacks and their protection capabilities underscore their vulnerability. “While data breaches at large corporations make headlines, cybercriminals frequently target small companies due to their perceived lack of sophisticated security measures. Many companies rapidly transitioned to online platforms in recent years, often without adequate security infrastructure and internal cyber expertise.”
Bad actors use such tactics as phishing and ransomware against SMBs that “often lack the financial and personnel resources to rebound from attacks. Data breaches frequently jeopardize a business's survival and undermine consumer trust, potentially disrupting local economies and weakening overall market stability,” the company wrote.
Their needs extend beyond size, Ryan Kalember, chief strategy officer at Proofpoint, told Channele2e, noting that large enterprises can invest in advanced security measures, staff, and incident response teams.
“SMBs, who often do not have firewalls and rely on consumer-grade endpoint protection, are even more reliant on the effectiveness of their human-centric security controls,” Kalember said. “SMBs often lack resources and specialized expertise for complex security solutions, making them more vulnerable to attacks like phishing and malware.”
They also face challenges like regulatory compliance, employee training, and data breach consequences, which can lead to financial hardship or even force the business to close, he said.
That’s where MSPs, MSSPs, and other channel partners can help, bringing expertise to SMBs and acting as force multipliers to do what the smaller businesses usually can’t.
AI a Game-Changer
Kalember said that “generative AI has completely changed the game for attackers. Threats are faster, more personal, and harder to detect. MSPs and SMBs who have not experienced advanced threats in the past now need the best cybersecurity solution against the emerging threats.”
They also need a full solution and platform to protect Microsoft 365 rather than assembling pieces from multiple providers, which can impact their service levels and margins, he said, adding that this need is a key part behind the Hornetsecurity acquisition.
A Complementary Acquisition
The deal for Hornetsecurity will be a good fit for Proofpoint, Dhawan wrote. Proofpoint is a $2 billion company with more than 4,300 employees around the world and 85% of Fortune 100 companies – and more than half of the Fortune 1000 – as customers. Meanwhile, Germany-based Hornetsecurity brings with it more than $160 million in annual recurring revenue (ARR) and more than 20% growth, along with more than 12,000 MSPs, MSSPs, and other channel partners and more than 125,000 SMBs across Europe.
Hornetsecurity also comes with its
M365 Total Protection platform, which offers MSPs and MSSPs four plans they can offer their customers. The plans range from a basic one that includes AI-based advanced threat protection, email archiving, and email continuity to the top plan that comes with security awareness, phishing and attack simulation, permission alerts, auditing, and management, enhanced email reputation and delivery, and sensitive data checks.
A Focus on Microsoft
Embracing Hornetsecurity’s Microsoft 365 focus comes two months after
Proofpoint announced an expanded global partnership with Microsoft in which the IT giant will use its Azure cloud infrastructure and AI capabilities to host Proofpoint innovations and scale its own AI-powered threat and data protection.
“Built on top of Microsoft Azure, we’re delivering advanced, preventive protection for the most important layer in the cybersecurity ecosystem — the human layer,” Darren Lee, executive vice president and general manager of Proofpoint’s Threat Protection Group,
said in a statement at the time. “We’re equipping organizations with the capabilities they need to reduce human risk at scale and thrive in their digital workspace.”
While no financial details were disclosed, the deal is expected to close in the second half of the year. When it does, Hornetsecurity CEO Daniel Hofmann and COO Daniel Blank will remain in charge of the company and oversee its growth and strategy, according to Proofpoint. The rest of the management team will remain on board as well.
Hornetsecurity itself will be the central hub for all MSP and SMB customers within the group to ensure there is a continued unified approach to cybersecurity for them, improved service delivery, and faster innovation tailored to the need of SMBs and their service providers.
