Cybersecurity is not a discretionary purchase for corporates.
This must-have product soothes the minds of every cybersecurity executive in the world.
I’ll explain how this point of strength is capitalized on by major growth security tech company CrowdStrike (CRWD).
Let me put my stamp on this indispensable service keeping cloud services afloat.
I can say with conviction that this is the beginning of a multi-year trend being driven by the industry consolidation that took place last year along with the seismic shift to cloud technologies.
Fortune 500 companies are increasingly choosing CrowdStrike as their security cloud platform.
CrowdStrike customers have never been larger and have never bought more modules and the same type of optimism appears in the stickiness of the number of new customers that surpass annual recurring revenue (ARR) of over $1 million.
Cybersecurity is mission-critical to both the public and private sectors.
Endpoint or workload security is also essential to protecting a remote workforce and as many of you know, the global remote workforce has never been bigger because of the pandemic.
While the damage to the macroeconomy from the coronavirus is gyrating at an accelerated pace, it is forcing companies to conduct business differently and rapidly shift to a remote workforce.
With CrowdStrikes’ cloud-native platform, this lightweight agent is easily deployed at scale and its frictionless go-to-market engine, CrowdStrike is uniquely positioned to meet any type of cybersecurity requirement.
The financial performance of the company is as healthy as ever as the company added a record $99 million in net new ARR and year-over-year, they increased the number of net new subscription customers by 116%, achieving 90% subscription revenue growth and 89% total revenue growth.
There were three outsized achievements this year: CrowdStrike delivered exceptional growth at scale, significantly improved margins, and achieved positive free cash flow for the fiscal year.
The seismic shift to cloud-native technologies and cloud workloads including containers has created an environment with massive greenfield opportunities.
Many competitors are dragged down by the complexities of integrating acquired technologies, rationalizing their workforce, or retooling their on-prem offerings.
Another positive tailwind is when Broadcom (AVGO) began integrating Symantec, there was a nice increase in inquiries among both customers and partners because they simply didn’t like Broadcom’s new products and vacated them to move towards CrowdStrike’s offerings.
This dynamic will contribute to an expansion in CrowdStrike’s pipeline, an acceleration in the overall customer adoption and increased engagement with partners.
Several partners in the United States and abroad have launched Symantec replacement campaigns as well but I believe CrowdStrike offers some of the most robust products.
One company submitted a list of several thousand of their customers that will be migrating away from Symantec in the next year and there was very little overlap between these prospects and CrowdStrike’s existing customer base.
The customer base has more than doubled and now protects the safety of 5,431 customers.
870 net new customers in Q4 joined CrowdStrike, which is up 136% year-over-year.
Chief Information Officers (CIOs) and Chief Information Security Officers (CISOs) are looking for a strategic partner to help them bridge this skills gap and simplify their operations, while at the same time, reducing cost.
They are also looking for ways to leverage enhanced automation in their security operations to increase efficacy and free up resources.
These organizations are increasingly rotating capital to CrowdStrike’s Falcon platform to protect an array of workloads, stop breaches, and restore system performance.
All new customers increased average number of modules in every quarter this past fiscal year.
The percentage of all subscription customers with four or more modules once again increased and those that adopted five or more cloud modules grew to one-third of their customer base.
As customers adopt more modules that span a wide array of workloads, it strengthens the customer relationship and increases CrowdStrike’s strategic position with the customer.
Companies who pay for other security alternatives keep running into the same roadblock of patchwork vendors who are largely ineffective and bureaucratic.
The burden is then directly placed on their resource-constrained IT security team eroding performance and souring team morale.
Another big problem is that a large percentage of the corporate platforms are not on the latest build of Windows, they could not update to newer versions exposing them to malware and security malfunctions.
This result is a cumbersome, manual remediation process and often requires the security team to reach out to users directly dragging out any possible IT solution.
CrowdStrike simply has this covered and can replace all three endpoint security solutions with the Falcon platform and offer seven modules providing firms with comprehensive protection and visibility in their environment and freeing up internal resources.
Existing legacy vendor failing is a common problem, and they fall victim to malicious activity shutting down production at major international facilities.
The ability to deploy the solution quickly can save the customer millions in manufacturing line productivity losses.
Beyond the immediate value provided by remediating a breach, there is significant value realized by streamlining a security stack. With the Falcon platform, firms can eliminate more than ten legacy tools and considerably improve their visibility and security posture.
CrowdStrike is collecting customers across diverse industries, geographies, and size because of proven efficacy and stopping breaches, and its cloud-native platform and lightweight single agent that is easily deployed at scale.
The predictive power of AI-driven threat graph that gets smarter the more data it consumes means the products get better with age.
The coronavirus has done nothing to dent the insatiable trend of companies searching for better security solutions.
While the coronavirus is having an impact on the global economy, it will not stop cyber adversaries. Cybersecurity provides business resiliency and meets compliance requirements.
In times of crisis, adversaries will try to exploit the situation, prey on the public's fear, and escalate new attacks.
I know it's difficult to fathom, but we've already seen nation-state adversaries from rogue regimes and e-criminals launch phishing campaigns using coronavirus marketing as clickbait entrance mechanism.
The world of global business is certainly not naïve in 2020 and tech investors shouldn’t be too.
CrowdStrike is still a small company but its growth trajectory is a sight to behold and every dip should be bought on the back of their solid business model.
