If you were on the internet in a certain era, you remember McAfee. It was the defensive line between you and the rest of the internet, reminding you with incessant popups that you were not hacked, not quite yet, but only if you renewed your subscription right away. Then Intel bought the firewall company in 2010 for an eye-popping $7.68 billion and billed it as Intel Security, and the name McAfee became more closely associated with the company’s founder, a man who retired to Belize only to be accused of his neighbor’s murder. (Johnny Depp will reportedly play John McAfee in an upcoming film.)
But things didn’t work out with Intel (or Belize, for that matter) and so the unit formerly known as Intel Security will be McAfee once again. Today, Intel is officially inking a deal that will spin McAfee out, with the asset management firm TPG taking a 51 percent stake in the company at a $4.2 billion valuation. Intel will retain a 49 percent stake.
What “McAfee” means now rests largely in the hands of TPG and McAfee’s newly-minted CEO, Chris Young, who led Intel Security over the past two years. TPG partner Bryan Taylor will serve as the chairman of McAfee’s board, and Young will have a chance to prove himself out from under the umbrella of Intel.
The spinout is designed to give McAfee more independence to pursue “pure-play” cybersecurity, untethered from Intel’s chip-making ambitions. Laugh if you will at the McAfee branding (hey, at least it’s not Oath) but the company’s off to a pretty good start — it secures two-thirds of the world’s 2,000 largest companies and grew its revenue 11 percent in the first half of 2016. That is not a bad place from which to launch a company!
It seems that Intel and McAfee are going through a very mutual breakup. Both parties wish each other the best (Intel CEO Brian Krzanich said in a statement, “We offer Chris Young and the McAfee team our full support as they establish themselves as one of the largest pure-play cybersecurity companies in the industry”) and setting a cybersecurity company like McAfee free from Intel’s hardware ambitions seems mutually beneficial.
“With so many different elements of the threat landscape, a cybersecurity company needs to develop technology from a different place than a semiconductor company,” McAfee chief technology officer Steve Grobman told TechCrunch. “If you think a lot about the technology we would have defended organizations with six years ago — perimeter defenses, signature-based AV [anti-virus] — we had a rate and pace of new threats that was largely manageable, whereas in 2017, the threat landscape is changing very, very quickly.”
While Intel and McAfee turned out not to be the ideal match, Grobman pointed out that Intel will still benefit from the monetary successes of McAfee. He also noted that McAfee/Intel Security took a positive turn under Young’s leadership. “The division took a positive course correction over two years ago when Chris came in to run the group,” he explained. Young, he said, brought in a change in strategy: “The change in strategy from a broad product strategy, having a product in every category, was not as good a strategy as a targeted strategy where we focus on the areas where we can be world-class.”
The company is also reaching out to other defenders. In November, it open-sourced a messaging interface to allow different security products to communicate with each other — an effort to break down the silos between different enterprise cybersecurity products. “We have two choices: have technology work as islands or have technology work together,” Grobman said. “The ability to have good results with things working together is significantly more effective.”
McAfee has pursued a few other partnerships: It’s a founding partner in NoMoreRansom.org, a site that attempts to unite ransomware victims with keys to decrypt their data, and in the Cyber Threat Alliance, an organization that shares threat intelligence data among cybersecurity firms.
Now that McAfee has more room to maneuver, is it possible that the company will snatch up some of the cybersecurity startups rumored to be up for acquisition? Grobman tells us that he “can’t name any specifics on companies that are under consideration,” which sorta implies that there are companies under consideration. We’ll have to wait and see.
And about that McAfee branding? Grobman said we’re the only people still worrying about what John McAfee is up to. Going back to the original name is “a business decision based on the brand position of McAfee as a trusted security brand,” he said, adding, “It’s important that people recognize John hasn’t had anything to do with the company in over two decades. Although he has interesting aspects of his personal life, people don’t think about the person. They recognize the value that the brand brings.”