Minneapolis-based Code42, a software security business started in 2001 and considered one of the bigger success stories of the Twin Cities’ tech scene, has been acquired.
Code42, a Twin Cities tech darling, acquired by Massachusetts-based cyber firm
The software company that once considered selling public shares during tech boom now part of Massachusetts-based Mimecast.
The Minnesota Star Tribune
July 25, 2024 at 4:30PM
Mimecast, a Massachusetts-based cyber-protection business, said the transaction will enhance its insider threat detection and response services. Terms of the deal were not disclosed.
Earlier this year, the two companies entered a technology partnership that combined Code42′s Incydr software and Mimecast’s security products to better protect organizations from data leaks and theft.
“Employee collaboration is at the heart of successful organizations today,” said Code42 CEO Joe Payne in a statement. “Protecting organizations from data exfiltration requires enhanced visibility into risky user activities across email, collaboration platforms, web, cloud and more. By joining forces with Mimecast, we can help customers quickly detect and respond to threats across their expansive digital environments.”
Code42, which has raised over $135 million from private investors, at one point had around 600 workers. Payne told the Star Tribune in 2021 that the company had shrunk to about 500 employees. In an interview with investor and podcaster Nathan Latka last year, Payne said Code42 had annual recurring revenue of $120 million in 2022, before the company sold its CrashPlan unit to private equity firm Mill Point Capital for $250 million in August of that year.
CrashPlan, launched in 2007, accounted for $70 million of the company’s annual recurring revenue, Payne said. The number of employees that departed Code42 as part of the CrashPlan transaction was not disclosed, but Payne addressed the matter in a statement at the time of the deal: “We are grateful for the contributions of the CrashPlan team and wish them continued success in this next chapter.”
Code42 has 175 employees, with 126 based in Minnesota, according to Mimecast, which employs more than 2,000 people worldwide and serves more than 40,000 customers. In 2021, Mimecast went private in a deal with Permira valued at $5.8 billion.
Payne will assume an executive advisory role at Mimecast. For now, Code42 will exist as a Mimecast company, but eventually the brand will cease to exist once the integration process is complete, the company said.
“Unlike fragmented point solutions, Mimecast provides a connected approach that is engineered to offer complete visibility and strategic insight across customers’ ecosystems, enabling intervention that helps them prevent costly incidents caused by insider risk and data exfiltration. Integrating leading solutions like Code42 broadens and deepens our proven security and human risk management capabilities,” Mimecast CEO Marc van Zadelhoff said in a statement.
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