NSE5_FAZ-7.0 information - Fortinet NSE 5 - FortiAnalyzer 7.0 Updated: 2024

A good way to minimize errors in investment is to align it with macrotrends. Cybersecurity is one such trend as it deals with protecting the vast amount of data generated globally on a daily basis. Fortinet (NASDAQ:FTNT) is a good way to gain exposure to this sector as it combines several aspects I appreciate in a high-quality business: a founder at the helm who is aligned, competitive advantages, strong margins and returns, and low debt. Despite the technical challenges in the sector, I believe we can approach the investment in Fortinet from a less technical and more qualitative perspective.

Business Model

Fortinet, Inc. is one of the leading companies in the cybersecurity sector. It is a technically challenging industry with constant disruption and change. The company provides multiple solutions in the form of software and hardware for its clients. In Q3, the management announced its sales segmentation into Secure Networking, Secure Operations, and Universal SASE. They indicated their intention to expedite the transition of the business to the latter two, as they are cloud-based components. To achieve this, Fortinet has invested significantly in Point of Presence (POPs) infrastructure. A POP is a physical location in a network where devices, users, or services can connect to access other points in the network. According to Barclays Global Technology, Media & Telecommunications Conference, over the past two years, Fortinet has built 30 POPs (with another 35 in progress). Through a partnership with Google, they now have access to 180 new POPs, enabling them to catch up with competitors who typically have between 100 and 200. POPs often refer to facilities that include data centers. Nevertheless, Fortinet's strategy of building their own POPs is beneficial for future cost savings and greater vertical integration, despite the higher current capital expenditure. Additionally, Fortinet manufactures its own ASICs (application-specific integrated circuits), chips created exclusively for Fortinet's hardware and software. This in-house production enhances performance and, in the long run, reduces costs.

Market

Fortinet's Total Addressable Market is enormous, standing at $125 billion. The company's billings in 2023 are projected to reach around $5.3 billion, indicating that Fortinet currently holds only a 4% market share. This is within a highly fragmented market that is experiencing annual growth rates of 10%.

Fortinet combines a business model that sells both software and hardware. Although the hardware segment experiences slower growth and lower margins, it contributes to building an ecosystem. Once a device is installed at a customer's site, cross-selling becomes much easier. They anticipate double-digit growth for the hardware segment in the coming years. Fortinet attributes this expected growth to their superior product in this area, positioning them to gain market share when it's time for competitors' hardware replacements, as they are the largest player in this domain. However, it is highly likely that the services segment will grow at a faster rate, and since it has higher margins, we can anticipate future operational leverage for the company. Within the subscription services, there is the AI product, along with customer support, training, and repairs services.

The slowdown experienced in the Secure Networking segment (which constitutes 70% of sales), especially in the Hardware division, follows an absolute boom post-COVID, during which customers made substantial purchases. Currently, customers are more cautious about their buying decisions, leading to inventory accumulation. However, there is an expectation that inventories will return to normal levels, allowing for the satisfaction of future demand. Given the technological nature of this product, the extent of obsolescence during inventory holding is uncertain. It's worth noting that this segment has still achieved a solid 9% growth, though it previously grew at a rapid pace of 40%. Despite facing a challenging comparison base, the company has managed to maintain a commendable growth rate.

Moreover, it's essential to consider that these cycles typically last two years, implying that we might be at the midpoint of the cycle, and the market could soon start factoring in its conclusion. As illustrated, sales are a lagging indicator, and attention should be directed towards Billings for a more timely assessment.

Management and Capital Allocation

If management by itself is one of the most important aspects of a company, in a sector as disruptive as cybersecurity, investing in a management team we can trust is extremely important. The founders, Ken Xie and Michael Xie, have been with the company since the year 2000, and together they control more than 15% of the outstanding shares. Their interests are fully aligned with the shareholders. Their extensive knowledge of the sector is significant, and their capital allocation strategy has been very effective.

The Net Income to Free Cash Flow conversion is over 100%, thanks to it being a subscription-based business. Most of the free cash flow has been allocated to share buybacks (reducing outstanding shares by -10% over the last 7 years) and some small acquisitions. Stock options represent 5% of sales and 14% of Operating Cash Flow, with a decreasing trend. This is quite favorable for a technology company. The company operates without debt and S&P Global rates Fortinet's credit category as BBB+. 90% of the capital allocated to "innovation" has been invested in research and development, with the remaining portion dedicated to merger and acquisition activities.

Competitive Advantages

In my opinion, the key strength of this company lies in its unified platform, FortiOS (Fortinet Investor Relations Presentation, slide 31), which integrates various products and services rather than creating standalone solutions that are difficult to integrate. This not only generates a network effect but also presents high switching costs for customers, potentially leading to pricing power. The ecosystem created by the company makes it indispensable for the customer.

Financials

Fortinet's financials are impeccable. It has experienced very high double-digit growth in all its figures. For example, sales have grown at a rate of 23.5% (6-year CAGR), while FCF/share has grown at a rate of 63.5% (6-year CAGR), driven by operational leverage and share buybacks. This operational leverage has been due to a significant expansion of margins; for instance, the EBIT margin has increased from 7% in 2017 to an estimated 27% for the fiscal year 2023, although I will provide further commentary on this below. The returns are impressive, with average ROICs exceeding 100% in latest years. They also maintain a net cash position, with only around $1 billion in debt. Lastly, they follow an asset-light business model, where maintenance CAPEX ranges from 2% to 3% of sales.

In the Barclays Conference, management also discussed something about the margins. In the long term, their target is 25%, but the senior vice president mentioned that he wanted the flexibility to invest in marketing, R&D, or whatever was necessary to grow the business without being constrained by the margin. In their models, a 25% margin is feasible, especially as the services segment is expected to grow more than hardware. The 27% margin from last year was attributed to the strength of the dollar, as they invoiced in dollars but paid 70% of their staff in their local currencies (which were depreciated at that time). I always appreciate a management team focused on the long-term sustainability of the business, even if it means impacting current accounting with investments that enhance their competitive advantages.

Valuation

To evaluate Fortinet, I will use a discounted cash flow model, incorporating a discount rate of 10%, a terminal growth rate of 3%, and a free cash flow growth of 15% (historically, it has been 60% CAGR in latest years). With these assumptions, the calculated fair value for Fortinet is $60 per share. If we consider a scenario with higher growth, such as 20%, the fair value would be $85 per share. However, to account for this increased growth, it might be more appropriate to raise the discount rate to 12%, in which case the fair value would be $63. In any case, I believe that Fortinet's stock is undervalued, and that's why I rate the stock as a buy.

Risks

It is worth noting that 57% of total sales come from only three distributors. In the FY21 annual report, it's mentioned that the Exclusive distributor accounted for 31% of sales. This significant concentration not only poses a risk in itself but also raises the consideration that these distributors might resell products from competitors and could be incentivized to favor these competitors in the future, potentially at the expense of Fortinet. Nevertheless, the risk of these distributors severing ties with Fortinet, one of the top companies in the sector, seems remote. It's akin to a sports channel specializing in football, breaking agreements with the Premier League and ceasing to broadcast it. Clearly, it's a lose-lose situation for both parties. Furthermore, another major client would likely seek to absorb this new volume and gain an advantage over others. The situation appears unlikely, despite the increasing customer concentration, as these dynamics are inherent to the sector. For example, Palo Alto Networks also has 50% of its sales with three clients (cybersecurity application providers).

Inventory Risks: The accumulation of hardware devices in inventories may not always be favorable. While it enables the company to meet growing demand when the cycle changes, there is a risk of obsolescence in a rapidly evolving sector. Furthermore, 88% of their hardware is produced in Taiwan, which could be impacted in the event of a future conflict with China. However, the company likely has contingency plans in place to address this potential issue if it arises.

Disruption Risk: Given the rapid emergence and evolution of new threats today, Fortinet has a dedicated department responsible for identifying these emerging threats. They investigate these threats using AI and subsequently develop corresponding mitigations to distribute to subscribed customers. It's noteworthy that customers pay for subscriptions to benefit from these services for a period ranging from 1 to 5 years. Furthermore, thanks to its scale, Fortinet has a very high R&D budget in absolute terms, as well as an extensive customer distribution. All of this is complemented by founders at the helm with deep knowledge of the industry.

Conclusion

In conclusion, I believe Fortinet is a great company for having exposure to the cybersecurity sector. The lack of expertise can be mitigated by placing trust in a well-aligned management team with expertise in the field. Additionally, the fantastic fundamentals and scale provide protection against disruptive threats. The company can also defend itself through the ecosystem it creates by combining software and hardware, even as it increasingly focuses on the more profitable segments of services. Overall, I find the price attractive, and I anticipate satisfactory long-term results.

SUNNYVALE, Calif., Jan. 02, 2024 (GLOBE NEWSWIRE) --

News Summary
Fortinet® (NASDAQ: FTNT), the global cybersecurity leader driving the convergence of networking and security, announced that it will hold a conference call to discuss its fourth quarter and Full Year 2023 financial results on Tuesday, February 6, at 1:30 p.m. Pacific Time (4:30 p.m. Eastern Time).

Fortinet's financial results conference call will be broadcast live in listen-only mode on the company’s investor relations website at https://investor.fortinet.com. While not required, it is recommended that you join at least 10 minutes prior to the event start.

The CEO and CFO’s prepared remarks, supplemental slides and a call replay will be accessible from the Quarterly Earnings page on the Investor Relations page of Fortinet's website at https://investor.fortinet.com/quarterly-earnings.

About Fortinet 
Fortinet (NASDAQ: FTNT) is a driving force in the evolution of cybersecurity and the convergence of networking and security. Our mission is to secure people, devices, and data everywhere, and today we deliver cybersecurity everywhere you need it with the largest integrated portfolio of over 50 enterprise-grade products. Well over half a million customers trust Fortinet's solutions, which are among the most deployed, most patented, and most validated in the industry. The Fortinet Training Institute, one of the largest and broadest training programs in the industry, is dedicated to making cybersecurity training and new career opportunities available to everyone. FortiGuard Labs, Fortinet’s elite threat intelligence and research organization, develops and utilizes leading-edge machine learning and AI technologies to provide customers with timely and consistently top-rated protection and actionable threat intelligence. Learn more at https://www.fortinet.com, the Fortinet Blog, and FortiGuard Labs. 

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Zero-trust security architecture is the new norm for safeguarding federal agencies and their data. However, challenges loom large in aligning with the Administration’s zero-trust mandates, especially as it sets ambitious targets for 2024.

Dan Daly, deputy director for information assurance and cybersecurity for the Transportation Security Administration, and Felipe Fernandez, CTO for Fortinet Federal, recently joined FedScoop to share their insights on the government’s zero trust journey.

One of the primary obstacles Daly highlighted is the intricate process of transitioning from existing legacy environments to the new zero-trust architecture. The federal government’s budgeting process, spanning over five years, poses a significant hurdle, making it challenging to swiftly adjust security postures and budgets to align with the comprehensive zero-trust framework. Despite the executive order allowing a few years for compliance, the practicality of executing this transition within budgetary constraints remains a substantial concern for agencies.

Fernandez emphasized the importance of a cultural shift within federal agencies to ensure successful zero-trust implementation. Executive adoption of zero-trust principles and a collective commitment at all levels are crucial for overcoming inertia and achieving a unified approach to security. The complexity of agency networks, characterized by multiple enclaves with varying degrees of intricacy, further complicates the implementation of a centralized zero-trust approach.

“There’s not just one technical solution for an entire zero-trust principle or set of principles. At times, you’re going to have to get two different solutions, three different solutions, or accept risk in various elements. And that’s just the challenge of where we are,” Fernandez said.

Daly highlighted how TSA has made significant strides in zero-trust initiatives. “Fortunately, our administrator was fully supportive from the beginning, allowing us to secure approval for a resource allocation…This approval gave us the necessary resources to dedicate a team to zero trust, unlike many other agencies that had to divert existing personnel from ongoing cybersecurity responsibilities to adopt this new paradigm.”

Learn more about evolving government security architectures.

This video panel discussion was produced by Scoop News Group, for FedScoop and underwritten by Fortinet Federal.

Dec 18, 2023 - Fortinet, the global cybersecurity leader driving the convergence of networking and security, today announced the latest release of new, integrated operational technology (OT) security solutions and services. These additions further distance Fortinet’s industry-leading OT Security Platform from the rest of the market.

“We understand that OT differs significantly from traditional IT systems, and that’s why our OT Security Platform was purpose-built to provide integrated protection and risk management specific to industrial environments,” said John Maddison, Chief Marketing Officer and EVP, Product Strategy at Fortinet. “Rising attacks on critical infrastructure have made OT security more important than ever before. With today’s news, Fortinet continues to empower customers with the most sophisticated OT solutions and intelligence in the industry.”

The need for integrated OT-specific security

The number of industrial devices connected beyond their network boundaries is rapidly increasing, and CISOs now face skyrocketing risks across their OT environments. In fact, Fortinet found that three-fourths of OT organizations reported at least one intrusion in the last year, and nearly one-third reported being victims of a ransomware attack. To solve this challenge, organizations need an integrated security approach designed specifically for industrial solutions that enables policy enforcement across the entire attack surface, consolidates point products, and reduces operational overhead.

Bolstering Fortinet's OT Security Platform with enhanced offerings

The Fortinet OT Security Platform is an integrated portfolio of cybersecurity products, solutions, and security services designed specifically for industrial networks and powered by real-time OT threat intelligence. Because the OT Security Platform is a part of the Fortinet Security Fabric, it empowers customers with deep visibility across their entire environment and securely facilitates IT/OT convergence. The platform also gives organizations the ability to implement a zero-trust model within OT environments, including secure remote access to OT assets and systems for remote employees and contractors.

OT Security Platform updates announced today, which build on improvements unveiled earlier this year, span two key pillars of the Security Fabric:

Secure Networking for OT:

• The new FortiSwitch Rugged 424F is an industrial-class ethernet switch (IES) designed to address the requirements of digital substations and the power utility industry. The switch supports real-time OT networking protocols and integrates with FortiGate Next-Generation Firewalls (NGFWs) for comprehensive security and access control.
• The new FortiAP 432F access point meets Class 1, Division 2 requirements for use in hazardous OT environments. It can segment industrial Wi-Fi networks to prevent attacks from spreading across unprotected devices and systems. This expansion of the IP67-rated access-point line now enables the deployment of additional OT applications in industries such as oil and gas.
• The new FortiExtender Vehicle 211F wireless gateway is a semi-ruggedized mobility solution for connected fleets, mobile systems, and OT deployments. It was also designed to meet the requirements of the AT&T FirstNet wireless communications network for first responders.
• FortiOS, Fortinet’s operating system, has been updated with the OT View dashboard, which correlates and displays important OT data. This dashboard makes it easy for organizations to understand their entire attack surface—both IT and OT—and take action from a single console.

Security Operations and Services for OT:

• FortiAnalyzer now includes OT-specific analytics, risk, and compliance reports, providing security operations teams with faster threat detection, asset and vulnerability correlation, and reporting.
• FortiNDR, which supports on-premises, cloud, and hybrid deployments, can now analyze more than 15 different OT-network protocols. It also includes AI-powered OT-network behavior analysis to identify malicious network activity and files.
• FortiDeceptor, Fortinet’s deception technology for early breach and attack isolation, now supports 30 OT protocols and additional OT decoys to protect diverse industrial environments.
• The FortiGuard OT Security Service boasts the industry’s deepest OT threat intelligence database and now covers more than 70 OT protocols and more than 4,000 OT application and device vulnerability signatures. These signatures enable strict access control policies on network traffic and provide virtual patching for vulnerable OT assets.
• FortiGuard Outbreak Alerts, an industry-leading cybersecurity resource, now includes critical information about OT-specific threats. This empowers customers with the information they need to harden their systems against new and emerging attacks following the NIST Cyber Security Framework.

"IT and OT are converging and these colliding environments are increasing overall risk. Our clients require robust OT solutions and services without extensive deployments that complicate administration and place additional strain on IT and security teams. Through the Fortinet OT Security Platform, we can provide clients with a unified approach of safeguarding both the carpeted side of a business as well as the concrete side of the business. We eagerly anticipate introducing these updated and novel offerings to our customer community," said Dan Sanderson, VP of Strategy, Cyber Advisors.

The FortiGate-3600 offers a plethora of security services in a rack-mountable unit that is clearly built for speed and performance. Fortinet claims that the product's throughput reaches 4 Gbps, making it suitable for even the largest of networks. What's more, the FortiGate-3600 includes the six elements most vital for network security,firewall, antivirus, VPN, intrusion detection, content filtering and traffic management,into an easily managed, unified administration point.

Combining those features with the FortiGate-3600's impressive throughput gives solution providers a single-vendor solution to meet all of their customers' network security needs. That helps to reduce training and implementation costs while increasing support options. Furthermore, the unit's ASIC-based design and redundant power supplies help to maximize reliability. For sites requiring the utmost in availability, a second FortiGate-3600 can be added to support failover functionality.

Accountability is another benefit stemming from the use of a single-vendor security solution. If a problem does occur, the specter of "finger-pointing" is eliminated. Solution providers often find that in integrated multivendor solutions, any problems that crop up can lead to one vendor blaming the other for a sometimes-unsolvable issue, leaving the solution provider holding the bag.

At $29,995, the FortiGate-3600 is far from inexpensive, but once prospective customers consider what the unit has to offer, sticker shock quickly fades. Solution providers should focus on the fact that the unit has no additional per-seat charges and no user limits. Those considerations mean a great deal when it comes to antivirus and VPN features, as competitors often charge based on user count for each of those features. What's more, the unit's simplified administration and ease of configuration offer long-term savings.

Fortinet offers VAR support via its channel program, which was created in May 2002. Called the FortiPartner Program, Fortinet requires its VARs to achieve a Product Technical Certification, meet annual revenue commitments and support a number of joint marketing activities. The FortiPartner Program is broken down into three levels,Platinum, Gold and Silver,which are based on a solution provider's commitment to Fortinet and approval by a Fortinet regional sales manager. Solution providers committing to the program can enjoy margins as high as 30 percent. Fortinet also provides its partners with marketing funds (either co-op or MDF), a partner Web portal containing tools and information, complimentary sales training, and sales and marketing support personnel.

CRN Exam Center engineers connected the FortiGate-3600 to a test network to evaluate the unit's feature set and administration tools. The FortiGate-3600's browser-based configuration makes the initial installation a snap, while the excellent documentation answers almost any question a competent installer may have. Solution providers will find segmenting the network a snap with the unit's six separate Gigabit interfaces, which are well-labeled and sport diagnostic LEDs.

The unit's administrative interface is straightforward and offers a help function. The interface is quite easy to navigate and is segmented into the unit's six primary functions, all of which are defined by intuitive separate icons. The interface's submenus follow form and are also easy to understand and navigate.

The FortiGate-3600 automates much of the security process. When viruses are encountered, the unit automatically deals with them and informs the recipient. The same can be said for other security elements, as the administrator is informed of security problems as opposed to an end user, except when necessary.

Automatic updates are also part of the package. Installers can define a schedule of when the FortiGate-3600 automatically contacts the Fortinet support Web site and downloads the latest virus signatures and content-filtering lists. That feature helps to keep the unit at its prime capability for combating problems and should be scheduled to occur as often as feasible, perhaps several times a day.

Solution providers will find the FortiGate-3600 an excellent solution for dealing with today's security threats. All of the main security areas are well-represented by the unit, and ROI can easily be demonstrated by the unit's feature set and robust support options. Arguably, the only downside to the unit is the initial high cost and the trend to move away from a multilayered security solution, but that is true of most any appliance-based solution.

The FortiGate-3600 offers the speed, performance and other features desired by enterprises of any size, while easing both administrative and support burdens. Solution providers can benefit from high margins and added revenue opportunities for installation, support and training associated with the unit.

CHANNEL PROGRAM SNAPSHOTS
>FORTIGATE-3600

COMPANY: Fortinet
Sunnyvale, Calif.
(408) 235-7700
www.fortinet.com
DISTRIBUTORS: Alternative Technologies, Westcon
TECH RATING:

CHANNEL RATING:

Note: Vendors can earn up to five stars for technical merit and five for their channel program. If the average of these two scores is four stars or greater, the product earns CRN Test Center Recommended status.

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Fortinet harnesses more than a decade of AI innovation and deep threat expertise to empower customers with a cutting-edge GenAI tool that upskills cybersecurity teams

SUNNYVALE, Calif., Dec. 11, 2023 (GLOBE NEWSWIRE) -- Fortinet^® (NASDAQ: FTNT), the global cybersecurity leader driving the convergence of networking and security, today added Fortinet Advisor, a generative AI (GenAI) assistant, to its portfolio of more than 40 AI-powered offerings. AI has served as the backbone of the Fortinet Security Fabric and FortiGuard Labs threat intelligence and security services for more than a decade, and the implementation of GenAI is Fortinet’s latest innovation designed to protect customers and keep business operations online. The initial release of Fortinet Advisor will help support and guide security operations (SecOps) teams so they can investigate and remediate threats faster than ever before.

“Fortinet has pioneered artificial intelligence innovation within cybersecurity, and to date, we’ve delivered more than 40 AI-powered offerings that put the transformative power of this technology into customers’ hands,” said Michael Xie, Founder, President, and Chief Technology Officer at Fortinet. “We’re excited to build on our legacy as a leader in AI cybersecurity innovation with Fortinet Advisor, which combines Fortinet’s vast intelligence network with the benefits of GenAI to increase security team productivity and accelerate threat detection and mitigation.”

Fortinet Advisor Empowers SecOps Teams
Today, Fortinet Advisor is available within FortiSIEM, Fortinet’s security information and event management solution, and FortiSOAR, Fortinet’s security orchestration, automation, and response offering.

Fortinet Security Operations Solutions already enable customers to slash the time needed to identify and contain threats from more than 20 days to less than an hour and condense investigation and remediation timelines from more than 18 hours to 15 minutes or less.¹ By providing contextually aware incident analysis, remediation guidance, and playbook templates, Fortinet Advisor delivers critical information in natural language within seconds so SecOps teams can further reduce the mean time to detect and respond as well as Strengthen their organizations’ overall risk posture.

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Specific benefits of Fortinet Advisor for SecOps teams include:

• Interprets security incidents: Fortinet Advisor rapidly analyzes alerts to generate easy-to-understand incident summaries within seconds, including context and potential impact.

• Builds complex investigation queries: Fortinet Advisor helps security analysts generate productive queries to aid investigations. Analysts enter their desired insights—in natural language—into Fortinet Advisor, which creates precise syntax to return useful results.

• Creates remediation plans: Fortinet Advisor aids in rapid threat response by suggesting threat remediation plans. It can also refine suggested response plans based on real-time analyst feedback.

• Augments playbook creation: Security architects can consult Fortinet Advisor to generate playbook templates, translating processes into actionable plans quickly.

Fortinet Advisor is continuously updated and refined by Fortinet AI and product specialists. Fortinet experts regularly refresh the assistant’s knowledge base with the latest threat information and optimize its interactions and results.

More than a Decade of AI-Powered Threat Research, Prevention, Detection, and Response
Fortinet has been on the bleeding edge of AI innovation for more than a decade, and more than 700,000 customers already benefit from AI-powered offerings, including FortiGuard AI-Powered Security Services, FortiAIOps, FortiEDR, and FortiAnalyzer. The use of AI across the Fortinet Security Fabric aids in zero-day threat detection, helps remediate today’s most sophisticated attacks, and enables IT teams to refine and resolve networking and security issues before they impact the organization.

An Industry-Leading Cybersecurity Platform
The Fortinet Security Operations portfolio is a part of Fortinet’s cybersecurity platform—the Fortinet Security Fabric—and because of this tight integration, organizations can move from a reactive to a proactive security posture and quickly detect and disrupt cyberthreats. Fortinet Security Operations Solutions utilize AI and advanced analytics to identify sophisticated threats early in the kill chain and automate response activity across the Fortinet Security Fabric to speed investigation and remediation.

“GenAI has the power to make security teams smarter, more efficient, and more productive. Fortinet Advisor, which is backed by Fortinet’s long history of AI innovation and deep threat expertise, can help organizations Strengthen business operations and harden themselves against attack, especially for those struggling with the cybersecurity skills gap.” – Jon Oltsik, Distinguished Analyst and Fellow at Enterprise Strategy Group.

Additional Resources

1. ESG, ESG Economic Validation: The Quantified Benefits of Fortinet Security Operations Solutions, August 1, 2023

About Fortinet

Fortinet (NASDAQ: FTNT) is a driving force in the evolution of cybersecurity and the convergence of networking and security. Our mission is to secure people, devices, and data everywhere, and today we deliver cybersecurity everywhere you need it with the most extensive integrated portfolio of over 50 enterprise-grade products. Well over half a million customers trust Fortinet's solutions, which are among the most deployed, most patented, and most validated in the industry. The Fortinet Training Institute, one of the largest and broadest training programs in the industry, is dedicated to making cybersecurity training and new career opportunities available to everyone. FortiGuard Labs, Fortinet’s elite threat intelligence and research organization, develops and utilizes leading-edge machine learning and AI technologies to provide customers with timely and consistently top-rated protection and actionable threat intelligence. Learn more at https://www.fortinet.com, the Fortinet Blog, and FortiGuard Labs.

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Solution provider Mainline Information Systems on Wednesday said it this month hired Eric Mann, an experienced storage and security sales professional, as its new executive vice president of sales and marketing.

Mann, who has known Mainline Information Systems President and CEO John McCarthy for about 30 years, started working with the solution provider in July of 2017 on a temporary basis to consult on business development and merger and acquisition but is now full-time at Mainline.

Before joining Mainline, Mann spent over two years between 2015 and 2017 in the security industry as a vice president at Sunnyvale, Calif.-based Fortinet and chief operating officer at New York-based Varonis.

[Related: Solution Provider Red8 Taps Industry Vet As New President]

Before that, he spent 12 years at Sunnyvale, Calif.-based storage vendor NetApp, where he left the company as senior vice president and general manager of the company's Americas sales.

Mann took over at Mainline for Bill Nemesi, the company's former senior vice president of sales. McCarthy told CRN that the departure of Nemesi, who spent the last nine years reporting directly to him, was an amicable one.

While the experience of working with security and storage vendors was important, the sales experience is different on the vendor vs. the solution provider side, Mann told CRN.

"There are some similarities in terms of how you look at where to sell, where the opportunities are, and where you put people," he said. "But on the partner side, the focus on building repeatable practices and services is more valuable. Also, the value proposition of your people and resources is higher than on the manufacturer side."

While Mann was working with Mainline last year on mergers and acquisitions, there were no acquisitions during that time, McCarthy said. "But we are always turning over rocks looking for acquisitions," he said.

Mainline is still owned by a single person, and runs with no debt, had has been approached numerous times by potential suitors, McCarthy said.

"I can't say how many times we have been contacted about getting acquired," he said. But [Chairman and Founder] Rick Kearney sees the opportunity of remaining independent."