Gigamon CEO on acquisitions and vendor consolidation

Shane Buckley, Gigamon CEO shares his views on the challenges of vendor consolidation as well as how the cybersecurity vendor is looking at mergers and acquisitions to support its growth.

As organizations around the world continue to focus on vendor consolidation, especially in cybersecurity, Shane Buckley, CEO of Gigamon believes that the companies should consider all their options first before deciding on how they can consolidate their solutions.

In an interview with CRN Asia, Buckley pointed out that while organizations look to consolidate the number of solutions and vendors, they work with to have better management of their cybersecurity and reduce their cybersecurity budget, the reality is that it’s not a simple scenario that can be dealt with easily.

“Security leaders are under a lot of budgetary pressure. There's been a lot of discussion and trends of tool consolidations, moving to kind of platform approaches. That's very dangerous because typically if you go with a single vendor solution, single vendors tend to have one or a small number of ways of actually capturing the bad actors,” Buckley said.

For Buckley, cybersecurity has always been about defense in depth. And so traditionally, security professionals have always had multiple mousetraps to catch the mouse.

“If you have kind of one way to catch a mouse and the mouse gets past that mousetrap, then you are kind of exposed. And so that's definitely a challenge for customers. The big benefit we provide to those customers is Gigamon introduces masses of efficiency for customers. We dramatically reduce the levels of unnecessary traffic that hit these tools in the first place. So therefore, customers actually can do a lot more with less. By saving money in terms of the tools they currently have, they can keep that diversity of tool stack in place. Because you need to have multi-layered defense for security. And even still, it's becoming very hard. It is a cat and mouse game. And unfortunately, the mouse is winning in many ways,” Buckley explained.

Buckley also pointed out that companies generally pick the best possible security product for a particular purpose.

“Different companies choose different vendors. It's not up to us or anyone to tell them who they should choose. The downside of saying, because of cost, I'm only going to go with one security vendor, that's quite risky. Because then you are losing the competitive advantage that you could potentially get by deploying a third-party tool that actually is a totally different approach and maybe is more effective in catching bad stuff,” Buckley added.

From consolidation to acquisitions

With customers consolidating cybersecurity solutions, more vendors are also merging and acquiring other cybersecurity companies, especially startups that focus on specific capabilities to boost their offerings towards their customers.

When asked about Gigamon’s M&A plans, Buckley stated while they are 100% looking into this, the vendor is taking a very focused and strategic approach.

“We're being very selective as well. Companies buy technology for different reasons with time to market is typically a good reason to acquire technology. We're certainly looking at what we call add-ons to the business. And so, we're looking at a lot of different opportunities in the market,” he said.

Buckley explained that the valuations that Gigamon has had on acquisitions over the last two years have a been a little frothy.

“The other thing is, given the level of innovation we have, we've looked at probably two or three dozen companies over the last 12 or 18 months. And while we are actually interested in moving forward, we ultimately didn’t close any one of them, but we're super close to quite a few. We recognize that having done our diligence, we can do this ourselves, particularly when it came to AI,” he said.

While there are a small number of excessively premium-priced AI vendors out there, Buckley pointed out that there's also a huge number of AI companies that are just figuring out how to get it on.

“We've looked at those, and we determined that our own AI expertise is actually good enough, and we can bring it to market faster. Because then we don't have the challenge of taking someone else's technology and then retrofitting it back into what we do. Now, if we were the sort of company where we kind of just sold individual boxes and just, yeah, we could kind of buy and box it and just put a management interface in. We're a fabric, and so when we build out a solution, everything builds on top of our fabric. And so, it has to build on top of our platform and our Gigabit operating system.”

“We have to integrate the functionality directly on. Because the beauty of Gigamon is when you buy Gigamon inside the customer's network and you want to add a tool vendor, like a firewall or a DLP product or a cybersecurity partner, an NDR, you literally just connect it in, and then we figure out how to make it work. And then when you say, you want you to do SSL vertically, we just turn on an SSL license, and then all the tools' networks. That end-to-end capability matrix we have is how our product works. And so, if we build someone's third-party product, we can't stick it on the side of what we do. We have to integrate it directly inside the fabric,” he added.

Put simply, Buckley believes that Gigamon is not going to “bet the farm on something unless we really think it's something that we absolutely need.”

This is why Gigamon continues to be looking very judiciously at companies. While the vendor gets a lot of inbound reaches, Buckley said they are going to be being quite persistent with M&A.