Rapid7 Remains a Small Player Competing Against Larger, More Well-Capitalized Peers

Rapid7 is a small vendor in security operations and threat detection, which we view as key components of the cybersecurity stack, and which stand to gain wallet share of customers' spending as firms digitize their workflows. While secular tailwinds blow in Rapid7’s favor, we are wary of the firm’s fierce competition, especially against larger, more capitalized competitors, and exposure to macro swings. We also anticipate that the firm’s investments to expand its portfolio may take time to bear fruit.