Started in 2010, Duo Security provides a cloud-based product suite that offers clients authentication procedures and user access policies to prevent security breaches and account takeovers. The flagship product that launched its early success was its two-factor authentication system — a simpler, more intuitive alternative in an overly complicated industry, Song wrote in a published letter to employees.

"We've made our mark on the industry," he wrote. "With this deal, we will realize significant value for our shareholders, while gaining the opportunity to leverage Cisco's global scale and resources to democratize security faster without compromising our vision ... They agree with us on the past state of security, and we're going to fix it together."

The acquisition is part of a move into the cloud era and toward recurring revenue streams for Cisco, traditionally a designer and manufacturer of IT and networking products.

Cisco aims to grow Duo Security's presence in Michigan, Cisco spokesman Jim Brady told Crain's in an email. More details on integration and branding are to come as planning progresses.

The impact on Duo Security employees is also unclear. The networking giant plans to take on the "vast majority" of Duo Security's 740 employees, he said.

"The combination of our companies will help build on the promise of doing the right thing for our customers," Song told investor and media listeners during the Thursday call. He was not available for an interview last week.

Song did acknowledge in the letter to employees that they must be "wondering what this means for each of you" and said the company's values remain the same. But he did not provide more details on any potential staffing changes, or lack thereof.

Song was one of Crain's Newsmakers of the Year for 2017 and a Crain's 2017 Michigan Change Maker. Song and co-founder Oberheide were recognized by the Michigan Venture Capital Association as Entrepreneurs of the Year in November.

The company reported more than $100 million in annual recurring revenue for 2017, up from $73 million in 2016. It has 12,000 customers, including Facebook and Paramount Pictures. In addition to its Ann Arbor and Detroit hubs, it has offices in Austin, Texas; San Mateo, Calif.; and London.

Cisco (NASDAQ: CSCO) reported $48 billion in revenue in fiscal 2017, a 2 percent decline from 2016's $48.7 billion. The global company had 72,900 employees as of 2017. It designs, makes and sells IP-based networking products for the communications and IT industries, and provides related services.

Attorneys from Gunderson Dettmer's Silicon Valley and Ann Arbor offices represented Duo Security in the agreement.