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Michael Dell is Cybersecurity's New Kid in Town

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Back in the early 1980s, Michael Dell was the PC industry’s new kid in town. 

Dell was the quintessential tech entrepreneur of his time when he started PC’s Limited in a dorm room at the University of Texas in 1984. PC’s Limited, which went on to become Dell Computer Corp., changed the rules of the game by selling PCs and peripherals directly to consumers and businesses. The big PC makers at that time – namely IBM and Compaq – stuck to their channel models while Dell’s sales zoomed into the millions.  

Dell’s business trended with the times and, around 10 years after its founding, the company (which became Dell Inc.) started selling on the Web at Dell.com. In 2001, Dell became the world’s no. 1 PC manufacturer. Today Dell Inc. is a top global tech brand that plays in all things IT. Along the way, Michael Dell became one of the richest people in the world and made the Forbes list of billionaires. 

Now Michael Dell is cybersecurity’s new kid in town.   

Dell Inc. topped the news headlines in 2015 with its historic acquisition of EMC Corp. for $67 billion, the largest tech deal ever. EMC owns the multi-hundred million-dollar RSA franchise, one of the most well respected names in cybersecurity, which instantly moved Dell into the heart of that market. 

RSA has tremendous name recognition in the cybersecurity market. The popular RSA Conferences, which become part of Dell via the EMC acquisition, are held in the U.S. and internationally and draw more than 30,000 attendees each year. 

The EMC deal garnered so much attention that you could have easily missed the news about Dell’s confidential cybersecurity IPO plans during 2015, which were finally announced publicly towards the end of 2015. Dell’s SecureWorks will IPO as its own company in early 2016, and numerous news outlets have speculated it can be worth as much as $2 billion. 

Why is Dell spinning out SecureWorks as an IPO? This is pure speculation, but it could be that Michael Dell is looking to grab the biggest piece of the cybersecurity pie as quickly as possible. The worldwide cybersecurity market is forecast to grow from $75 billion in 2015 to $170 billion in 2020, according to Cybersecurity Ventures’ Cybersecurity Market Report. If Dell wants to take a run at the $100 billion that will be spent on cybersecurity over the next five years, it might be easier to do that with a more nimble, hot IPO flush with new cash and the type of buzz that attracts top talent. This is especially hard to come by at a time when the industry is suffering through a labor shortage

The SecureWorks spinout makes a lot of sense. The business unit is focused mainly on managed security services, which is one of the fastest-growing cyber sectors. The global managed security services market is exploding from $8 billion in 2015 to $30 billion by 2020. 

Is there a connection between SecureWorks and RSA? This is more speculation, but one can’t help but wonder if the RSA brand and assets will become part of SecureWorks down the line after the SecureWorks IPO is official and after Dell fully digests EMC. 

No matter how you slice it, Michael Dell is all of a sudden very big into cyber. 

Steve Morgan is founder and CEO at Cybersecurity Ventures and editor-in-chief of the Cybersecurity Market Report and the Cybersecurity 500 list of the world’s hottest and most innovative cybersecurity companies. Follow Steve on Twitter or connect with him on LinkedIn.

 

 

 

 

 

 

 

 

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