Atlas VPN predicts the number of new cybersecurity unicorns (startups valued at over $1 billion) will reach an all-time high if growth continues at its current rate for the rest of 2022. 

A spokesperson for the VPN provider told SDxCentral they “anticipate to see a continuing growth in the number of cybersecurity unicorns for the next few years.”

In 2021 there were 36 unicorns, but Atlas VPN sees the upsurge of cyberattacks on a global scale as an opening for new addressable markets and opportunities for cybersecurity companies to tackle. “There remains a lot of opportunities in the market since the industry is rather young and ever-evolving technologies create more gaps to fill,” the spokesperson said. 

The company drew its expectations from data in the Progress Partners Market Report for Q2 2022, which showed that in the first half of 2022, the cybersecurity industry produced 19 companies valued at $1 billion or more. The number of cybersecurity unicorns grew from six in 2020 to 36 in 2021, a 500% increase year-over-year.

Atlas VPN points to the increase in VPN application downloads as an indication of how the switch to remote work “created a significantly wider cyberattack surface.” The company’s market research showed that in 2020, people from 85 selected countries downloaded VPN applications over 277 million times, while in 2021, the number rose to 785 million.

The spokesperson said in theory, more workforces moving back to the office should reduce the attack surface, but companies changing their policies to allow work-from-home permanently means “the shift might not be that significant.”

Aside from valuations, the company reported cybersecurity exits over $1 billion reached an all-time high of 18 in 2021. In the first half of 2022, Atlas VPN said “we have already witnessed eight $1B+ exits, and if the trend continues, the total for the year will be on par with 2021.”

Atlas VPN predicts that the “golden age of the cybersecurity software market” will extend not only until the end of 2022 but into 2023 as well — although not everyone is so optimistic.

In June, analyst firm Forrester released its own predictions on the future of cybersecurity unicorns. Forrester said "the economic downturn is in its early stages, but it certainly appears as if the hypergrowth phase of the cybersecurity vendor party has come to an end."

Analysts Jeff Pollard, Jess Burn, and Allie Mellon suggested the trajectories of several unicorns -- Lacework, Cybereason, and OneTrust -- are evidence of an abrupt downturn in the cybersecurity market.

In November of 2021, Lacework closed a $1.3 billion Series D round on an $8.3 billion valuation. Cybereason raised $275 million led by Liberty Strategic Capital in July of 2021 for a total of $750.6 million, and Onetrust raised over $920 million in a Series C extension led by SoftBank Vision Fund 2.

But by June of this year, each of these unicorns announced significant job cuts to their workforces.

“Lacework, Cybereason, OneTrust — three vendors, over $3 billon dollars in funding, and over a thousand out of work,” Forrester analysts wrote.

Pollard, Burn, and Mellon said when "the spigot of easy investor capital shut off," vendor leaders discovered that they were “not optimized as a business."

The Forrester analysts also indicated the unpredictability of the current economy will, and should, keep companies on their toes.