Secondary markets are doing what IPOs used to: giving employees a way out. Cato Networks staff have completed another $100 million secondary share sale, according to a Calcalist report, marking the latest in a series of liquidity transactions at one of Israel’s most closely watched cybersecurity unicorns. The deal lets employees convert paper wealth into real money without waiting for a public offering that, despite years of speculation, has yet to materialize. For a company operating in the white-hot enterprise security space, the move speaks volumes about both internal pressure and external investor appetite.
Cato Networks, founded in 2015 by Shlomo Kramer and Yishay Yovel, has built its reputation around SASE — Secure Access Service Edge — a cloud-native networking and security architecture that collapses traditional on-premise infrastructure into a unified, globally distributed platform. The company has consistently attracted enterprise customers moving away from legacy VPNs and hardware firewalls, and its recurring revenue model has made it a perennial IPO candidate. Yet the public markets remain on hold, and secondary transactions have become the pressure valve.
A Pattern of Secondary Liquidity
This is not the first time Cato employees have tapped the secondary market. The company has facilitated multiple such transactions over recent years, cumulatively allowing staff to offload significant equity stakes while keeping the company’s cap table and valuation story intact ahead of any eventual listing. The $100 million figure reported by Calcalist is consistent with the scale of prior rounds, suggesting a structured, recurring approach to employee liquidity rather than a one-off event driven by urgency.
Secondary transactions of this size require sophisticated institutional buyers willing to acquire shares at a negotiated price — typically at or near the company’s most recent private valuation. Cato was last reported to carry a valuation in the multi-billion-dollar range, positioning it among the largest privately held cybersecurity firms globally. Investors willing to step into secondary positions at that scale are effectively making a bet that the eventual IPO or acquisition price will justify the premium they’re paying today for illiquid paper.
What the Timing Signals
The broader context matters here. Public market windows for tech IPOs have been inconsistent since 2022, leaving a backlog of well-funded private companies sitting on enormous unrealized valuations. Cato sits squarely in that cohort. Its SASE platform competes directly with Zscaler, Palo Alto Networks, and a growing field of AI-augmented security vendors — a competitive landscape that rewards scale and speed to market. Every quarter Cato remains private is a quarter competitors can use to consolidate enterprise contracts.
For employees who joined early or mid-stage, waiting indefinitely for an IPO is a financial risk unto itself. Secondary sales solve that problem structurally, but they also signal something to the market: the company is generating enough outside interest to support nine-figure liquidity events without resorting to a down round or emergency capital raise. That is, in its own way, a bullish data point. Whether it accelerates or delays the IPO calculus inside Cato’s boardroom is the question investors and competitors alike are watching closely. The SASE market is still expanding rapidly, and the clock for capturing category leadership is not pausing for anyone’s liquidity schedule.
