F5 Networks Buys Shape Security For $1bn

F5 Networks s to buy privately held Shape Security for $1 billion (£770m) in its deal to date, adding Shape’s fraud and abuse-prevention capabilities to F5’s multi-cloud application protection offerings.

The acquisition follows Seattle-based F5’s purchase of application delivery controller (ADC) vendor NGINX for $670m earlier this year.

Shape, based in Santa Clara, California, uses artificial intelligence-powered services to block attacks such as credential stuffing, where attackers use stolen passwords from third-party data breaches to access other online accounts.

The firm, which counts major banks, airlines, retailers and government agencies amongst its customers, says it blocks up to 1 billion fraudulent or unwanted transactions daily.

Enterprise app protection

Shape says its application protection platform evaluates the data flow from the user into the application and uses cloud-based analytics to decide whether the traffic is legitimate or fraudulent.

The companies said the acquisition should reduce the time and resources needed for organisations to deploy comprehensive online fraud and abuse protection services.

“With Shape, we will deliver end-to-end application protection, which means revenue generating, brand-anchoring applications are protected from the point at which they are created through to the point where consumers interact with them—from code to customer,” said F5 president and chief executive François Locoh-Donou, in a statement.

He said the buy would give F5 entry to a fast-growing $4bn market, while Shape’s machine learning and AI capabilities would extend F5’s existing portfolio of application services.

Integration

Shape said many of its existing customers were already using F5 technology to deliver and enable their applications.

“Now, we look forward to the opportunity to deeply integrate into F5’s platform for application delivery and security,” stated Shape co-founder and chief executive Derek Smith.

Shape was founded in 2011 and was valued at more than $1bn earlier this year, after raising $51m in a Series F funding round, bringing its total outside investment to $183m.

Smith and Shape’s other executives are to join F5 in “key management roles” after the deal closes, as is expected in the first quarter of next year.

Shape said the deal would allow it to remain in its current Silicon Valley headquarters.