Cisco Places Bet on AI Cloud Security with Isovalent Purchase

Network equipment giant Cisco on Thursday announced its next big cloud play with a plan to purchase open-source cloud networking and security firm Isovalent to boost its secure networking capabilities across public clouds.

Cisco says its acquisition, expected to close in the third quarter of fiscal year 2024, will build on the company’s AI-driven, cloud-delivered, integrated security platform, “Security Cloud.” The firms did not disclose the purchase price. Isovalent has raised $69 million in funding since launching in 2022, with Cisco and Grafana Labs as notable investors.

Umesh Padval, a board member at Isovalent and venture partner at Thomvest, tells InformationWeek in an interview that the acquisition will be a big win for both companies.

“With the tremendous value for security, networking, and observability… it was a perfect match for Cisco, to enable the next generation of security, networking, and AI-enabled products. This helps with multi-cloud and hybrid cloud environments,” Padval says. “When you have a company with Cisco’s channels, financial power… they can go places faster. And [Isovalent] was doing well in a horrible macro-economic environment and they were growing nicely. We were excited about the company and could have continued to raise money easily. But we said, ‘Hey, look at the channels Cisco has, the scope, this would be a tremendous asset. And the company can continue to execute its vision as part of Cisco.”

Cisco said it intends to continue offering and building on Isovalent’s slate of offerings, including its popular Cilium product.

“Together with Isovalent, Cisco will build on the open-source power of Cilium to create a truly unique multi-cloud security and networking capability to help customers simplify and accelerate their digital transformation journeys,” Jeetu Patel, executive vice president and general manager of security and collaboration at Cisco, said in a statement. “Imagine in today’s distributed environment -- of applications, virtual machines, containers, and cloud assets -- having security controls with total visibility, without hindering networking and application performance. The combination of Cisco and Isovalent will make this a reality.”

“Cisco is committed to nurturing, investing in, and contributing to the eBPF and Cilium open-source communities,” Stephen Augustus, head of Open Source at Cisco, said in a statement. “Isovalent’s team will join Cisco’s deep bench of open source governance and technical leadership to solve complex cloud native, security and networking challenges.

Isovalent has headquarters in Cupertino, Calif., and Zurich, Switzerland. Growjo.com says Isovalent has 159 employees and estimates the company’s annual revenue at $34.9 million. The announcement comes before Cisco closes on its largest ever acquisition, the $28 billion Splunk purchase. Just this year, Cisco acquired four companies, including threat detection platform Armoblox, identity management firm Oort, and cloud security firms Valtix and Lightspin.