Palo Alto Networks’ Nir Zuk: “The cyber market is maturing. Small companies have a problem selling standalone solutions that big companies provide”
Palo Alto Networks’ Nir Zuk: “The cyber market is maturing. Small companies have a problem selling standalone solutions that big companies provide”
“We prefer acquisitions. The reason we prefer acquisitions is because when a large company develops something new, the people that are doing it don't have the same incentives as those that do it in their startup. In a large company it’s not life or death if something you develop is successful or not,” added Zuk.
Nir Zuk - Mind the Tech London
(Alex Kolomoyski)
“I think that certainly valuations are high in cybersecurity, and we also overpaid probably, at least from our perspective, on the two companies that we acquired in the last few months, and for many others,” said Palo Alto Networks founder Nir Zuk, speaking at the Mind the Tech conference in London on Tuesday. “But look, everything has a price. It depends on the number of sellers and the number of buyers and unique companies will get what they deserve.”
Palo Alto acquired Israeli cyber startup Talon Cyber Security for around $625 million last year and paid over $300 million for Dig Security.
Zuk explained how Palo Alto decides which companies to purchase. “We have a technological roadmap, product roadmap, and we're looking to fill that roadmap with either internal development or through acquisition. And we, by the way, prefer acquisitions. The reason we prefer acquisitions is because when a large company develops something new, the people that are doing it don't have the same incentives as those that do it in their startup. In a large company it’s not life or death if something you develop is successful or not.”
Zuk also spoke about what he sees as Palo Alto’s biggest challenge at the moment. “The main challenge is always finding good people. Not just in Israel, but all over the world. We have more than a hundred open positions that are hard to fill.”
Zuk discussed his investments in Israel over recent years. “Cyber is my main focus, but then I also invest in companies in Israel. I've invested more than a $100 million of my own money in companies in Israel to combine doing good for the country and making money,” said Zuk.
“I'm bullish on the tech industry in Israel. And I think that there's a lot of opportunities. I think Israel has some of the best entrepreneurs in the world and some of the best developers in the world. And certainly you see the best cybersecurity companies coming out of Israel, as well as fintech companies, medical devices companies, healthcare management, drone companies, and other military technology coming out of Israel.
“But I think the biggest challenge of the Israeli tech industry, with the exception of cybersecurity, is money. We need more money. I think that some investors, especially investors coming from outside of Israel, are a little bit worried about investing in Israel. They're investing in cybersecurity because Israeli cybersecurity has proven itself. I think some investors are ignoring the success of some other sectors like fintech.”
You can watch the full interview in the video above.
