Microsoft acquired Aorato
In November 2014, Microsoft (MSFT) acquired Aorato. It’s based in Israel. It’s a cloud cyber security company. This is the first acquisition in Israel since Microsoft acquired 3DV Systems in 2009. 3DV Systems is based in Israel. It’s a gesture recognition company. Microsoft hasn’t disclosed the purchase price. However, unconfirmed resources stated that the purchase price was ~$200 million.
If Microsoft’s acquisition of Equivio is able to generate synergies, it will benefit Microsoft investors. It will also benefit ETFs—like the Powershares QQQ Trust ETF (QQQ) and the Technology Select Sector SPDR Fund (XLK)—that have high exposure to Microsoft.
The above chart shows that Aorato’s security technology exposes the security flaws in the active directory.
Aorato was founded in 2011 by the Israel Defense Forces’ technology unit employees. The company develops and sells software. It monitors access to central communication components in enterprise IT systems. Aorato gathered funding of ~$10 million—led by Accel Partners and Innovation Endeavors.
Glilot Capital Partners is a venture fund. It was another investor. The other investors in Aorato were two of the Trusteer founders. Trusteer is an Israeli information security company. In 2013, it was bought by IBM (IBM) for $650 million. NICE Systems Ltd. (NICE) and Trusteer are some of Aorato’s customers.
Aorato will complement Microsoft Azure
Aorato baselines all of its knowledge on a continuously updated “security graph.” We’ll discuss the details about how its security technology works later in this series. The graph maps all of the people and devices tapping the Windows Server Active Directory. Organizations use it as a repository for user access credentials to applications and systems. Aorato’s security technology is expected to complement similar functions that Microsoft already deployed in its cloud Azure Active Directory service.