The rush to AI-native security solutions and a massive surge in mergers and acquisitions that reached record levels were the main drivers of the cybersecurity venture capital market's unprecedented activity in 2025. According to data from cybersecurity investment bank Momentum Cyber, venture-capital firms invested $119 billion in cybersecurity companies in 2025. Of these, 400 M&A transactions accounted for the majority of funding, and another 820 financing deals totaled nearly $21 billion.
In 2025, the total value of financing, M&A, and IPO activity almost tripled compared to the previous year. Deal value records were set by M&A, but financing deals outpaced that volume, reaching 820 deals in 2025.
According to Momentum Cyber's "2025 Cybersecurity Almanac," AI security product companies closed the most deals (144), with startups concentrating on risk and compliance coming in second (137 deals). See also: Over 40% of South Africans Were Scammed in 2025 The need to safeguard the vastly increased attack surfaces brought about by the increasing use of AI agents in businesses, as well as the nearly sole focus of investment firms on AI-native cybersecurity solutions, are the two main causes of the investment boom. According to McAlpine of Momentum Cyber, "Strategic buyers essentially stepped up and used their balance sheets, and they accounted for 92% of the disclosed M&A capital deployed."
The company estimates the total value of the 400 M&A transactions exceeded $96 billion, even though more than half of the deals had no disclosed values. Related: Oceania's Retail and Services Sectors Are Under Attack Talented teams were another target for strategic acquirers. A list of the top 100 businesses with the most valuable employees was produced by calculating the cost of acquisitions per employee.
According to data gathered by Momentum Cyber, identity and access management company Sgnl came in second, despite having a much smaller workforce of 57 employees, while Wiz claimed the top spot with an enterprise value per employee of $13.5 million for its 2,362 employees.
