• Cato Networks is one of the giants of the SASE (secure access service edge) sector
• It has just announced the acquisition of an AI security specialist, marking its first M&A move
• The company has also raised more money and provided a sales update

SASE (secure access service edge) specialist Cato Networks appears to be having a great 2025. The company has just announced its first acquisition, of Tel Aviv, Israel-based AI security specialist Aim Security, and has also shared news of further fundraising and its sales progress. 

Let’s get the financial details out of the way first. Cato, which is also headquartered in Tel Aviv, says its annual recurring revenue (ARR) run rate has now surpassed $300m, though it doesn’t say whether it is yet profitable. The company previously stated that its ARR was $250m in 2024, and that was up by 46% compared with 2023’s figure. So Cato continues to grow, though maybe not at the same pace as it did last year. 

For comparison, another SASE market leader, Netskope, recently revealed in its initial public offering (IPO) filing documents that its revenues for the 12 months to the end of July this year were $707m, up by 33% year on year – see Netskope pulls its IPO trigger.

The SASE sector is one that continues to grow, though there are wildly different valuations and ways of measuring the sector. Dell’Oro Group is one of the more conservative research firms in terms of market valuations – it predicts that the SASE market will double in size in terms of its value over the next five years to be worth $17bn by 2029. 

Cato also noted that it has extended the Series G investment round it announced at the end of June with an additional $50m investment from Acrew Capital, bringing the total round to $409m. Cato’s total funding so far is more than $1bn. The extra financing took place on the same terms and valuation – $4.8bn – as the rest of the Series G investments, noted Cato. 

Cato has long been expected to file for an IPO and list its shares on the Nasdaq exchange, but it is yet to pull the trigger. The $4.8bn valuation coupled with a still growing market will help its case when it finally decides to take the public listing plunge, but Cato’s management might wait to see what appetite there is for Netskope’s shares before making a decision. 

As for the acquisition, Cato says the purchase of Aim Security will “further expand the Cato SASE Cloud Platform, enabling secure enterprise adoption of AI agents and public and private AI applications”. A purchase price was not published but according to Israeli news outlet Globes, Pitchbook, the private market financial platform and analysis company, has estimated the deal to be worth $375m. Aim Security, which was founded in 2022, has raised $28m in funding.

The rationale for the acquisition makes sense. Cato suggests that as AI transforms all kinds of businesses, its adoption introduces security, compliance and privacy risks as a result of “new interaction models with enterprise data by people, AI agents and AI models… With SASE becoming the de facto standard for a secure fabric connecting all enterprise resources, including employees, partners, locations, clouds, devices and applications, SASE is uniquely positioned as a primary control point for all AI interactions.” 

Shlomo Kramer, CEO and co-founder of Cato Networks, stated: “AI transformation will eclipse digital transformation as the main force that will shape enterprises over the next decade. With the acquisition of Aim Security, we’re turbo-charging our SASE platform with advanced AI security capabilities to secure our customers’ journey into the new and exciting AI era.”  

Kramer explored the reasoning behind, and the expected impact of, the acquisition in a blog handily titled Securing AI Transformation: Why Cato Networks Acquired Aim Security. 

Aim’s solution “spans three AI security use cases, supported by a unified and advanced core engine,” noted Cato. Those three use cases are: Securing employee use of public AI applications; securing private AI applications and AI agents; and securing the agentic AI development lifecycle with AI security posture management (AI-SPM). You can find out more about this in Cato’s press release. 

In it, the company explained: “Cato has pioneered the SASE market by building the first cloud-native SASE platform architected from the ground up to secure all enterprise network flows from any source to any destination. Unlike proxy-based and appliance-based architectures, Cato has complete, 360-degree visibility into AI interactions – from users accessing AI applications to AI agents, models, MCP servers, and other API-driven services supporting AI-enabled workflows. 

“Aim extends the Cato SASE Cloud Platform by unlocking a powerful set of AI security capabilities. These capabilities address the complexity and unstructured nature of AI interactions – as well as the evolving AI attack surface – to detect and stop threats, attacks, risky or anomalous access and data breaches. By converging Cato’s global visibility and policy enforcement capabilities, on-premises and in the cloud, with Aim AI security capabilities and expertise, Cato is now ready to secure customers’ AI transformation,” it added. 

- Ray Le Maistre, Editorial Director, TelecomTV