Tanium Inks Investment from TPG at $5 Billion Value

TPG’s growth investment arm has raised its stake in cybersecurity software unicorn Tanium Inc. with a $175 million investment. The latest funding values the San Francisco Bay Area-based enterprise software startup at about $5 billion, people familiar with the matter said on Tuesday. The company, which allows real-time data collection at enterprise scale, has landed a total of $580.7 million in eight rounds of funding from other backers including Andreessen Horowitz, IVP and T. Rowe Price, according to Crunchbase.

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The investment giant is already an existing backer in the company, which was valued at roughly $3.75 billion in another secondary sale which took place last year, according to Pitchbook. It is the second time that TPG’s growth arm has backed Tanium over the most recent 12 months and the third overall. In 2015, the same year that TPG led a mega round in cybersecurity player Zscaler, it participated in a $148 million financing round that valued Tanium at $3.65 billion. In secondary rounds of financing, cash does not go directly to the startup and instead goes to early investors and employees.

Founded in 2007, Tanium offers public and private sector customers, including banks, retailers and governmental organization such as the US Department of Defense, with cybersecurity and management services. After ten years of operation, Tanium said it secured 100% year-over-year (YOY) revenue growth in 2017 and positive operating cash flow. Reports indicated that the firm was profitable in the last three months of 2017, yet did not expect to sustain profitability.

The deal makes Tanium one of the highest valued startups in the U.S., particularly in the enterprise space where valuations tend to be lower. The transaction also adds to speculation that the private company may soon hit the public market, as allowing employees to cash out ahead of an initial public offering (IPO) is a common event.