FireEye's $1B Mandiant Buyout: Is the Price Too High or Too Low?
When you understand that you can't stop all attacks, but you can detect and remediate them before they do serious harm, the value proposition of Mandiant becomes apparent.
Security is one of the great market segments of the technology world as it's not typically driven by seasonality or cyclical demands. Security needs are constant and evolving. Simply put, no enterprise on the planet can afford not to invest continuously in security—for fear of being attacked and embarrassed in a public breach.
It's in that context that security vendor FireEye acquired security firm Mandiant this week for the sky-high sum of $1 billion in stock and cash. On the surface, $1 billion seems like an absurdly high price for a company that has only 500 customers. It's also somewhat ridiculous that FireEye, a company that generated $160 million in revenue for all of 2013, is paying so much and has the ability to do so.
