Lacework Valuation Reset and Acquisition

The collapse from $8.3B to a $152.3M sale shows how brutally cloud security valuations reset once growth slowed and the market stopped paying huge premiums for category promise alone. Lacework raised its November 2021 round at $8.3B while around $60M ARR, then grew to an estimated $95M ARR by 2023 as growth decelerated sharply. By August 1, 2024, Fortinet bought the company for cash and folded the product into its broader cloud security stack.1 3 4 5

• At the 2021 peak, investors paid roughly 138x forward ARR on estimated 2021 revenue. That kind of multiple only works if revenue compounds very fast for years. Lacework estimated ARR went from 3x growth in 2020 and 2021 to 33% in 2022 and 19% in 2023, which broke the valuation math.3
• The market did not reject cloud security itself. It rewarded the leaders and punished the laggards. Around the same period, Wiz was estimated at $500M ARR growing 103% YoY, Netskope at roughly $500M ARR growing about 49%, and Snyk at $250M ARR growing 25%. Lacework was smaller and slowing faster than the top independents.3 6 7 8
• For Fortinet, this was less a bet on Lacework as a standalone company and more a discounted way to add CNAPP product depth. Fortinet announced the deal in June 2024, closed it on August 1, 2024, and later launched Lacework FortiCNAPP, which shows the value was in the technology and installed base, not in preserving the old private market price.1 4 5

This points toward a cloud security market where the winners are broad platforms with fast growth or scaled distribution. Products like CNAPP still matter, but standalone vendors now need either breakout revenue momentum like Wiz or a strategic home inside a larger security suite like Fortinet.4 6 7 8