Two-Factor Authentication (2FA) Companies Continue to be Attractive Acquisition Targets

Merritt Maxim

Last week, Courion announced its acquisition of Nova Scotia-based SecureReset, which, through its QuickFactor product, provides mobile-based two-factor authentication (2FA). This is the fourth acquisition of a 2FA startup by an enterprise software vendor in 2015:

·         Twilio acquired Authy, February 2015 (purchase price N/A).

·         Salesforce acquired Toopher, April 2015 (purchase price N/A).

·         Micro Focus acquired Authasas, July 2015 (purchase price N/A).

·         Courion acquired SecureReset, November 2015 (purchase price N/A).

These acquisitions reflect ongoing enterprise demand for 2FA solutions as an alternative to passwords. By now, the problems with passwords are well-known: They are easy for hackers to steal in bulk, and ongoing advances in computing processing power have eroded password security.

Since a password-free world is still somewhere off in the future, two-factor authentication provides a compelling password alternative that can help mitigate security risks. The evolution toward software-based 2FA form factors running on smartphones instead of dedicated single-purpose hardware tokens has eased deployment and training costs; it has also enabled large-scale consumer deployments of two-factor authentication as a password replacement alternative. These 2015 acquisitions demonstrate the continued interest in two-factor authentication.

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