Black Hat Q&A

Thursday Aug 7, 2014 by Tom Bain - Vice President, Global Marketing & Security Strategy, CounterTack

As Black Hat 2014 kicks off in Las Vegas as we speak, there’s a substantial amount of buzz around a few things. First, there are as usual, some government initiatives like the recent DHS initiative to make cybersecurity solutions faster and more effective. Debate is open on this.  

Second, Black Hat is notorious for demonstrating different types of hacks on devices, applications, cars, systems - you name it. If it’s got a chip or there is some type of computerized element, it can and will be hacked.  

However, as an industry that has built itself on a reputation of innovation, Black Hat has become a showcase for innovative cybersecurity vendors who are touting new approaches.  

The investment climate has seen steady growth, but has spiked dramatically: With estimates showing that information security overall is a $67B market, this year alone, investors have dumped substantial amounts into the market, and should be on pace to exceed the $1.46B VC’s pumped into companies in 2013.  

As far as IPO’s and acquisitions, there are a number of security vendors who are planning an IPO within the next 12-18 months, and FireEye’s $1B+ acquisition of Mandiant figures to be the exit that sets the standard most recently, for growth companies in cybersecurity.  

Aside from fascinating hacking demonstrations at the Black Hat conference, emerging vendors are pushing their platforms to show how they can be deployed in large-scale environments to showcase new ways of implementing scalable security.  

I spoke with Mark Hatfield, Partner with Fairhaven Capital of Cambridge, MA, to gauge his perspective on the floor at Black Hat, for what he is seeing from a security investment standpoint, along with what he looks for in potential portfolio companies and the general scene across Black Hat. 

 

Q:  What do you look for when you attend Black Hat in terms of companies who stand out above the noise? 

A:  Investing in security companies has always been an interest and passion for me, especially now, due to the amount of innovation necessary in the ecosystem and the rising threat levels for organizations.  Black Hat has always been on the leading edge for new and emerging companies. I’m on the look-out for teams and companies that are attempting to redefine the security solution, and I look at Black Hat as having a wealth of opportunity. 

 

Q:  What has stood out for you so far at the conference? 

A:  The people, hands-down, is what always stands out. Every year the briefings with early-stage companies feature incredibly intelligent and vibrant individuals. And they may be early-stage, but the security industry routinely produces more advancement in terms of their product, technology and customer engagements. The emerging companies in this space seem to be more mature and experienced than ever before, and its an attribution to the people. 

 

Q:  Which of your portfolio organizations are attending Black Hat? Of those, is there anyone doing anything at the conference worth mentioning? 

A:  All of my security companies are at the show and each one of them is doing something special and interesting, in fact there are too many to summarize briefly. However, a few companies are worth pointing to: Digital Guardian debuted at Black Hat this year, with a new CEO, Ken Levine, and a new model for securing data; CounterTack just recently raised their Series B with a new, security-savvy investor, BlackBird, in addition to recently being named a Gartner Cool Vendor in endpoint security; Cylance has a new math-based approach to solve the massive malware problem; CO3 Systems’, CTO Bruce Schneier has a must-see presentation on the state of incident response.

 

Q:  Can you discern who has a legitimate model that can succeed based on first interactions at conferences like Black Hat? 

A:  It takes a lot more diligence than that, but at Black Hat you find all the right ingredients for a successful model: top talent, experienced services teams and new approaches that will lead to further discussions. One of the biggest benefits of the Black Hat conference is the concentration of top talent and companies in one captive setting. 

 

Q:  What will you ultimately look for at Black Hat this year, in terms of technology focus? Are there particular areas of the security market that are hotter, or more compelling than others? 

A:  Areas of particular interest for me are companies providing next generation of endpoint protection and threat analysis. I am also interested in technologies and teams coming out of the government or other larger companies looking to innovate by starting new companies through incubation programs.

 

Tom Bain is the Vice President, Global Marketing & Security Strategy at CounterTack.  You can follow Tom on Twitter (@tmbainjr1) by clicking here.

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