Veracode, a leading global provider of application security solutions today announced that TA Associates (“TA”), a leading global growth private equity firm, has signed a definitive agreement to make a significant growth investment in the company. Veracode’s current majority investor, Thoma Bravo, a leading software investment firm, will retain a minority position in the business. The transaction, which values Veracode at $2.5B, is expected to be completed in Q2 2022, subject to customary closing conditions.
An eight-time leader in the Gartner Magic Quadrant for Application Security Testing, Veracode offers a comprehensive software security platform that empowers organizations to deliver secure software at scale and with unmatched speed.
“What we do has never been more crucial,” said Sam King, CEO of Veracode. “The confluence of digital transformation, software supply chain complexity, and the strengthening regulatory environment places software security firmly in the spotlight. We’re grateful for Thoma Bravo’s partnership over the last three years and look forward to our next chapter with TA. Together, we aim to accelerate our vision to deliver the most comprehensive software security platform that caters to the needs of both development teams and security teams by enabling them to build and deliver secure software at the speed that business demands.”
Under pressure by the ever-accelerating pace of digital transformation, software development teams are often forced to make tradeoffs between speed of delivery and the security of the software they deploy. Veracode’s platform balances the needs of both development and security teams by streamlining workflows to help customers ensure that software is coded securely without compromising speed while providing a comprehensive view of software security posture through powerful reporting and analytics. Collectively, Veracode customers have scanned over 53 trillion lines of code and fixed more than 71 million security flaws. With more than 2600 customers and nearly two-thirds of its revenue generated from large enterprise companies, the business has consistently outpaced growth forecasts for spending growth in application security.
“TA recognizes the strong market opportunity for Veracode, driven by the need to secure software and educate developers,” said Jason Werlin, a Managing Director at TA. “We believe Veracode’s heritage and sustained leadership position, along with the breadth and depth of its portfolio, uniquely positions the company to drive the next wave of growth in the application security market. TA is excited to partner with the Veracode management team and Thoma Bravo on the next phase of the company’s journey.”
“Over the last three years, Veracode has expanded its platform, extended its market footprint, and established a clear track record of sustained innovation,” said Seth Boro, a Managing Partner at Thoma Bravo. “In today’s digital world, cybersecurity solutions are more critical than ever before, and Veracode continues to drive innovation while helping solve customers’ most complicated security needs. We are very proud of what Veracode has achieved under our majority ownership and look forward to continuing to support Veracode as it enters its next phase of growth in partnership with TA.”
“We are committed to our mission, strategy, and product vision,” continued King, “and we are excited to partner with TA, leveraging its significant experience investing in enterprise software companies and track record in scaling growth businesses, to realize that vision. We plan to invest in the expansion of our product portfolio through organic development and strategic M&A, as well as accelerate the expansion of our global footprint and growth, while maintaining the healthy business fundamentals we have achieved over the last few years.”
Continued expansion of Veracode’s talented team around the world is central to its growth objectives. The company is hiring talent in engineering, product management, marketing, sales, and customer success. Today, Veracode’s more than 725 team members around the world embrace remote and hybrid work models and are committed to the company’s mission to ensure that the software that powers our world is secure.
Deutsche Bank Securities Inc. is serving as exclusive financial advisor to Veracode and Thoma Bravo, and leading and providing committed debt financing to TA for the transaction. Barclays is serving as financial advisor to TA. Kirkland & Ellis is acting as legal counsel to Thoma Bravo and Goodwin Procter is serving as legal counsel to TA.
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