SentinelOne (S) is the most common seen name when Crowdstrike is mentioned. When I look into people’s decision on why their team chose S over CRWD, however, the #1 reason is cost and rarely anything else. Not because S has a better product than CRWD. To me it seems like S has been undercutting CRWD with their price in order to gain market share and that’s how they are able to maintain high revenue growth. S do have a strong product over traditional antivirus vendors but roughly at the same level or less than CRWD.
This is just an assumption.
The flipside is that CRWD charges a premium.
Why would Crowdstrike try to charge more?
They have been a fast-growth public company, and have more pressure to ensure they deliver strong numbers. Whereas a private company has more freedom to focus on market share or R&D vs revenue numbers.
I haven’t looked at it in a while, but in Spring 2020 I did a comp for a large Enterprise of S vs CRWD and essentially S was cheaper and their features were all-inclusive while CRWD did the multi-module approach (which caused the total price to add up).
Client wound up pushing the project due to covid at the time, wreaking havoc on their budgets. But they were still leaning towards CRWD because of existing familiarity and probably a more “well-known” brand in the marketplace.
CRWD got a lot of press around the DNC hack or something like that…Trump mentioned their name early on in his term, too. You can’t buy that kind of PR and name recognition. That, combined with funds and heightened awareness from their IPO gave them a lead over S.
Essentially, I think the tech is fairly equal. The difference becomes who can execute in Sales and Marketing.
People tend to want to think there is something magical going on…some kind of software secret sauce that is utterly unique. I have found, when it comes to Enterprise infrastructure (whether hardware or software) many of the top vendors have products that work. Some are simply better-run companies than others.
S may wind up doing quite well. But, yeah, their valuation is nuts. As is CRWD still, imo. But there is no question security is going to remain a mega-hot trend. You just can’t assume every security event you read about would actually have been stopped by CRWD or S or ZS or PANW, etc… There will be a lot of winners, and that is why I am not sure a massive valuation makes sense.
Sure AI works better and better at scale. But if you were a hacker, and 80% of the enterprises decided to use CRWD…well…why wouldn’t you put all your efforts into hacking CRWD?