NEW YORK (The Street) -- Cybersecurity spending topped $71 billion worldwide last year, according to research firm Gartner, with an 8.2% uptick predicted for 2015 to a total market size of $76.9 billion. FBR Capital Markets predicts a global 20% increase in spending this year and Markets and Markets, a global market research firm, said that number could more than double to more than $155 billion by 2019.
This is a unique opportunity for investors. "Think mobile and IoT [Internet of Things] security," said Steve Morgan, CEO of Cybersecurity Ventures.
But this space has not always been an easy one to analyze and penetrate for investors. That is also changing.
According to Pure Funds, creator of the world's first cybersecurity ETF, PureFunds ISE Cyber Security ETF (HACK), there are three reasons why investors should consider investing in this space now. First, threats are up year-over-year since 2009 at a compound annual growth rate of 66%. Second, cybersecurity incidents may create short-term price appreciation for cybersecurity companies. Third, diversification in this space is highly recommended for tech portfolios. Barely eight months old, the "Hack" ETF has a year-to-date return of 20.5%.^SPX data by YCharts
Part of this explosion is being driven by the mobile web, according to Morgan of Cybersecurity Ventures, which also recently released its Cybersecurity 500 list of the world's top performing companies in the space.
"Smartphones, tablets, and other mobile devices have become targets for hackers," Morgan said. "As that trend continues and mobile payment technologies take-off -- namely Apple (AAPL) Pay and Google (GOOG) (GOOGL) Wallet -- mobile devices will become even bigger victims of cybercrime."
Morgan's list contains some familiar names and some yet-to-be discovered performers, including FireEye (FEYE) (No. 1 on the list), Palo Alto Networks (PANW) (No. 12), Checkpoint (CHKP) (No. 39) and Akamai (AKAM) (No. 53). The list also contains non-U.S. companies like the Finnish F-Secure (FSOYF) (No. 22 on the list), which allows users to surf, store and share information invisibly and securely. Despite a dip in price last October, F-Secure has regained value and then some over the course of this year.
CyberArk (CYBR), at No. 28 on the list, is a company that many are watching for its innovations in perimeter and threat security. "CyberArk helps customers rethink their cybersecurity strategies by presuming the threat is already inside the network," said Udi Mokady, its founder and CEO.
CyberArk's 2015 first-quarter revenue was $32.9 million, an increase of 89% year-over-year. And revenue in 2014 was $103 million, an increase of 56% year over year.
But it is not just the mobile Web that is driving this trend.
"There's a big opportunity in 'next generation' solutions, including cloud security and big data security analytics," said Morgan. "Spending forecasts from multiple sources estimate the market for these technologies could reach $20 billion in the next 3 years," he said.
Morgan also recommends that investors look to innovative cyber start-ups, which can provide innovative solutions when established players don't. His list includes both public and private start-ups, which are often looking to raise financing as they grow.
"There are small fast-growing cybersecurity firms who are doubling and tripling revenues annually, with prospects to continue on that fast track," said Morgan. "These companies tend to be in a specific niche with a rising tide."
The fact that these companies are often not well known is one of the great values of his list.
Morgan is also not afraid of digging into the meat of valuations. KEYW Holding (KEYW), for example, comes in at No. 372. Why? Morgan says it's overvalued.
Overall, though, Morgan said, "The cybersecurity rocket ship has taken off and it is ascending very quickly in to the stratosphere."