Investment firm KKR has completed its $3.8bn deal to acquire cloud-first security company Barracuda as cybersecurity investments slow down.

KKR announced the deal to buy Barracuda from software investment firm Thoma Bravo in April this year.

While financial terms of the transaction were not disclosed, Reuters has put the deal at a cool $3.8bn. That’s more than double the $1.6bn Thoma Bravo paid for the company in 2018.

More than 200,000 customers worldwide use Barracuda’s solutions to protect their email, networks, applications, and data.

“We are excited to complete this transaction and begin working with the Barracuda team to support their continued growth and delivery of next generation cloud-first cybersecurity solutions that protect SMEs from an evolving landscape of threats,” said John Park, a Partner at KKR.

A dearth of deals in cybersecurity

KKR completing the acquisition of Barracuda comes as the cybersecurity industry is facing a deals slowdown.

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Venture capital (VC) deals have gained momentum over the past decade as more companies have opened their eyes to the importance of having solid digital defences. The result has been a proverbial cybersecurity boom.

The pandemic accelerated this trend, with laptop-wielding larcenists using the Covid-19 crisis to launch ransomware attacks and a plethora of other digital assaults.

The numbers speak for themselves. Back in 2013, the VCs injected just a bit over $1bn into the cybersecurity companies, according to data extracted from research firm GlobalData’s deals database on August 17. By 2021, that figure had swelled to $25bn.

The numbers have dropped slightly in 2022. So far this year, 358 VC deals have only injected $9bn into the industry. For anyone counting, that's less than half of the investment the industry enjoyed in 2021.

That being said, it's just south of the $10bn injected into the sector in 2020.

GlobalData is the parent company of Verdict and its sister publications.