Avecto Raises First External Funding with $49M from JMI Equity

JMI Equity, the specialized growth equity firm based in San Diego and Baltimore, has invested $49 million to establish a minority stake in Avecto, a U.K.-based network security firm that has established its U.S. headquarters in Somerville, MA.

Avecto specializes in so-called endpoint security, an approach that protects a corporate network by focusing on the devices accessing the network (the endpoints), and monitoring their status, activities, software, authorization, and authentication. Avecto says its Defendpoint technology enables a global organization to improve network security by managing user privileges, controlling device applications, and “sandboxing,” a method for isolating and testing applications from untrusted sources without allowing the program to access the host system.

Avecto was founded in 2008, and the company says it has increased its revenue by 50 percent annually since 2012. The company raised no external funding before the JMI deal.

In a statement released today, Avecto co-CEO Paul Kenyon said the investment from JMI would enable the company to expand its global sales and marketing efforts and expedite its R&D plans.

Avecto currently has 42 U.S. employees, and plans to hire seven more by the end of the year, according to a spokesman for the company. The U.S. workforce accounts for almost a third of Avecto’s 151 employees worldwide.

JMI Equity, founded in 1992 with a stake from BMC co-founder John Moores, makes growth equity investments in mature software companies. Since its founding, the firm has raised more than $3 billion and invested in more than 120 companies. Jit Sinha, a general partner based in Baltimore, and Suken Vakil, a principal based in San Diego, are joining Avecto’s board as part of the deal.

Author: Bruce V. Bigelow

In Memoriam: Our dear friend Bruce V. Bigelow passed away on June 29, 2018. He was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Bruce Bigelow joined Xconomy from the business desk of the San Diego Union-Tribune. He was a member of the team of reporters who were awarded the 2006 Pulitzer Prize in National Reporting for uncovering bribes paid to San Diego Republican Rep. Randy “Duke” Cunningham in exchange for special legislation earmarks. He also shared a 2006 award for enterprise reporting from the Society of Business Editors and Writers for “In Harm’s Way,” an article about the extraordinary casualty rate among employees working in Iraq for San Diego’s Titan Corp. He has written extensively about the 2002 corporate accounting scandal at software goliath Peregrine Systems. He also was a Gerald Loeb Award finalist and National Headline Award winner for “The Toymaker,” a 14-part chronicle of a San Diego start-up company. He takes special satisfaction, though, that the series was included in the library for nonfiction narrative journalism at the Nieman Foundation for Journalism at Harvard University. Bigelow graduated from U.C. Berkeley in 1977 with a degree in English Literature and from the Columbia University Graduate School of Journalism in 1979. Before joining the Union-Tribune in 1990, he worked for the Associated Press in Los Angeles and The Kansas City Times.