Cato Networks employees sell another $100 million in shares
The cybersecurity company has completed its second employee secondary in a little over a year as it continues to grow while remaining private.
Cato Networks has completed a second secondary transaction in 15 months in which employees sold approximately $100 million worth of shares.
The transaction allows employees to realize some of the value of their holdings without Cato going public or being acquired. It comes as the Israeli cybersecurity company continues to grow rapidly while remaining private.
The latest transaction follows a roughly $120 million employee secondary completed as part of Cato's $359 million funding round in June 2025. That round valued the company at $4.8 billion and brought its total funding to more than $1 billion.
Cato has continued to expand since then. The company reported annual recurring revenue of $415 million in the second quarter of 2026, up 42% year over year, with more than 4,000 customers.
Founded in 2015 by Shlomo Kramer and Gur Shatz, Cato has built its business around a cloud-based platform combining networking and cybersecurity. The company reached $100 million in annual recurring revenue in 2022 and raised $238 million at a $3 billion valuation in 2023.
Despite that growth, Cato has remained private. Its IPO plans have been delayed amid weaker public-market conditions for technology companies and the broader uncertainty facing the cybersecurity sector.
The repeated secondary transactions offer a way around that problem. Rather than waiting for an IPO or acquisition, employees can sell part of their holdings to investors while the company continues to grow.
Cato said it does not comment on specific transactions, but emphasized the role of employees in creating the company's value.
“Cato’s success is built on our people, who are among the leading talent in the industry. It is important to us that our employees share in the value they help create and are recognized for their contribution to the company’s rapid growth,” the company said.
Cato added that it seeks to balance the interests of investors seeking to increase their ownership with its commitment to allowing employees to benefit from the value they have helped create.
“When these interests align, it creates exactly the balance we strive for, and we will continue to pursue opportunities that enable this going forward,” the company said.
