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Zscaler claims $1bn pricetag as TPG Capital invests

Silicon Valley finds new unicorn as cybersecurity market continues to boom.

By Jimmy Nicholls

The American cybersecurity firm Zscaler achieved a value of $1bn (£640m) on Monday, after raising $100m in its latest investing round.

Led by TPG Capital, a private equity firm founded in Texas, the investment will allow Zscaler to further develop its security-as-a-service business, which protects Internet users from cyberattacks.

The ten-figure valuation also places it among the so-called "unicorns" of Silicon Valley, in only the latest evidence of the ripe market for cybersecurity.

Jay Chaudhry, chief executive of Zscaler, said: "Our mission is to make the Internet safe for business by delivering an amazing security platform that protects our clients and enables the strategic adoption of cloud computing, mobile devices and the Internet of Things

"The investment and partnership from TPG and the global relationships and experience they provide will enable us to accelerate investment in our technology, grow our customer base and aggressively scale our business to meet growing demand."

Speaking to the Wall Street Journal, Chaudhry also confirmed that he expects Zscaler to make an initial public offering (IPO) in the next year or two, the chief executive having had a history of selling tech start-ups for considerable amounts.

In investing the money TPG joins the ranks of EMC, a data storage group that also owns RSA Security, and Lightspeed Venture Partners, whose portfolio has included security firms such as Arbor Networks, Bromium, and Click Security.

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"We see tremendous opportunity in the rapidly-growing cybersecurity industry, and after spending significant time in the space, we found Zscaler to be the leading cloud-based security solution for the world’s largest and most demanding customers," said Nehal Raj, a partner at TPG who will join Zscaler’s board as part of the round.

"We are looking forward to partnering with Jay and his team to accelerate growth, most immediately by introducing Zscaler to the potential customers and channel partners within our global network."

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