142 Yotam Segev (Cyera) Final Transcript
[00:00:00]
Intro: One of the sales guys who was already doing well was telling me that he's going to close a deal for $3 million a year. Come on. Come on. If you close it for a million dollars, I'll build an altar with your picture in the office. Yeah, exactly. Keep this picture in my wallet alongside you, my wife and kid.
Two years ago, how many people were you guys? A hundred people. And now five 50. Five 50. What would you tell people about growing in that past? Many things don't scale, but values actually scale really well. The fact that you ended up landing on this problem set. I have data personally that I would like to remain my own.
Yeah. Your browsing history, maybe I'm not there. Let's not be specific here. Welcome to the Logan Bartlett Show. On this episode, what you're gonna hear is a conversation I have with Yotam Segev, the co-founder and CEO of Cyera, one of the fastest growing cybersecurity companies in the world right now. We cover a lot of ground in this conversation, including what it takes to operate at a breakneck pace.
Yotam also talks about facing a tough first year after raising a big round of capital from Sequoia and what ultimately helped turn RA [00:01:00] around and become a breakout business. We also get into the state of the cybersecurity market, particularly after the acquisition of Wiz by Google. We discussed what opportunities are emerging, how buyer behavior is shifting, and why this may be a defining moment for the industry.
A really great conversation that you're here with. Yotam now.
Logan: Yotam, thanks for doing this.
I'm glad we got this on the calendar. I, uh, I appreciate you coming into the apartment too. This is, uh, this, we mix up studios sometimes so that the, the home studio is a fun one to do.
Yeah.
Yotam: was at the home studio, it was at Josh's. Uh.
Logan: Yes, yes. Yeah, yeah, yeah. Well, uh, I'm glad we were able to get this on the calendar, so it's been a wild ride.
So for people that probably don't know. So we invested in Cyera in June-ish of 23 coming up on two years ago. Is that right? It's been a wild ride. So, how many people, two years ago, how many people were you guys?
Yotam: Two years ago, we were a hundred people,[00:02:00]
Logan: A hundred people and last year, 12 months ago
Yotam: 550
Logan: and so that journey of growing like that, I guess can you just take me through like it's, it's unnatural in a lot of ways to grow that quickly.
There's only a handful of businesses that have ever done that, one of which was just acquired by Google. So I'll ask you about that in a bit. But I'm curious, like just keeping the train running and on the tracks, when you're growing that quickly, what have you learned?
Logan: What would you tell people about growing that fast?
Yotam: Wow. I think that when you go that fast, really go back to the fundamentals in sense of like values. are our values? What are the people that we want? What is the attitude that we want? And values scale. Like many things don't scale, but values actually scale really well. And if you have a core team that's bought in on the values and bought in on the identity that you want the company to [00:03:00] have, who are our people?
How do our people act? How do our people operate? How do our people think? Uh, and if you have a clear value proposition around that, that scales really well and allows people to recruit and choose the right people into their teams, into the, uh, organizations and scale the, the organization with some cohesion.
Logan: Was that something that was like purposeful from the start, or did you figure that out along the way that values was gonna be something that enabled you? To scale,
Yotam: I think when we started, we didn't view it as values. We viewed it more as, who do we love working with? What are the people that we are excited to, to wake up every morning and, uh, and spend the majority of our, uh, fruitful hours in the day, if not all of our fruitful hours, fruitful hours in the day, walking with. And it was more out of passion and attraction, I would say, than uh, like a concrete framework of thought around who are the people that [00:04:00] are going to do well here. But as we started to scale, we realized that we have to formulate it. We have to be able to, to talk about it. And we have to be able to, to really make sure that it, uh, into the decision making that many people across the company make every day. 'cause I'm not the one hiring all of these people. Many people are hiring all of these people. So what do should they be thinking about when they're doing
Logan: and what is your articulation of the values today? Like how do you describe what SRA is or what a SRA person is?
Yotam: Smart, humble, hungry.
Logan: Smart home. Simple.
Yotam: Very simple.
Logan: And so at some point along the way, like, was that at a hundred people or 50 people? Like at what point did you sort of codify, like that's, that's what you're looking for.
Yotam: I think it was in the, in the past year that we started to, to really codify it and talk about like are the people and what are the characteristics that are most important to us, as a company and as individuals. And if we can get those characteristics in 500 people and then a thousand people and then 5,000 [00:05:00] people, then that's special.
Logan: To give a little bit of background. So, so can you give me your, like how you ended up in cybersecurity, how did, how did you start Ciera and kind of go down this path?
Yotam: So cybersecurity for me was, uh, happened through the Israeli military, uh, Tamma, my co-founder and I, Ana, our VP engineering shy, our first, uh, uh, team leader in the engineering department. We all serve together in ot, which is Israel's, uh, elite Technological Leadership Academy. It's a, it's a program that, uh, sends uh, leaders into every technological, uh, core area of the IDF, from ballistic missile defense to, you know, a submarine warfare. And we were the cybersecurity generation. Uh, 15 years ago. It was the, the hottest topic. Today, of course, it's all about ai, right? Or everybody wants to, to go into those types of, uh, positions. But in our, in our days, cyber was the, the hot thing. And many of us, if not all of us, got posted in [00:06:00] cybersecurity leadership positions across the IDF. That's, uh, eh, that was what essentially brought us into cyber. Obviously it was a choice. We had a lot of influence on this decision, and for me, cyber was super attractive because there was something about it that was very technological. I. But also very operational. At the end of the day, my role was called cyber operations. That's what I did, uh, for my career in the military. And there was a part of it that was very deep in tech. There was a part of it that was very deep in operations, and I enjoyed that, uh, very much.
Logan: so, so you were in the military for how long?
Yotam: We spent a decade
Logan: decade. So from, from 18 or 19 to 28.
Yotam: to 2020,
Logan: 20. And the impetus to leave was to start a company.
Yotam: my impetus to leave was, uh, because Tamal, back in the day, COVID was, uh, was hitting Tamal, finished his service, uh, a bit before [00:07:00] me. He took classification, and uh, he was supposed to go do the Pacific Re trail. It's like a 4,000, 5,000 mile trek in the us And Covid hit and closed the trail down. And the day that he got the notice that the trail is an opening this year, and his, uh, plans are, uh, ruined, he called me and told me, quit.
We're starting. And that's exactly what I did
Logan: And, and so when you, when you left, how many people were you managing?
Yotam: in the military. I was managing about 50 people when I left,
Logan: And so 50 people and of all ages backgrounds, relatively young.
Yotam: was mostly a young, uh, group. The Israeli military works on conscription, so you get incredible talent because nobody can choose to go to MIT or Cornell or Caltech and, you know, miss out on the fun of, uh, protecting your country. It's a mandatory, uh, service. So it, it's based mostly on very young people that, um, embodi, uh, the core of the military.
Logan: [00:08:00] And so how did you, how did you get looped into the venture ecosystem and actually like come up with, uh, an idea? I think, uh, people are, especially now in light of, um, the Wiz acquisition, and I think a lot of the success you guys have had, as well as, as well as other companies that have come out of 8,200 or Tapio as well.
It's, it's become a, uh, a popular, you know, thing for venture folks like myself to invest in. But I'm curious, like how does, before it was a little bit more mainstream, how do you actually find your way into the venture community? How do you come up with an idea? Yeah.
Yotam: ot, which at the time uh, had about a thousand alumni in its history in its 40 year history at the time, is a pretty small community that has had an unproportional impact on Israeli technology ecosystem. One of the founders of Checkpoint was a OT alumni, three of the four, uh, with founders of alumni.
Logan: Was Palo Alto
Yotam: Uh, no, Nia
Logan: near was not.
Yotam: was not, but uh, but you know, it's. a very small group of [00:09:00] people that have success in those circles, started startups, grew them, some of them. Uh, so. It was definitely something that for us, seemed natural to go into that path of starting a company, founding a company, and uh, and building something. I think we had no relationship to the venture ecosystem when we started. Uh, we actually spent the first, uh, nine month of the, like, the company's life. It was just Tamara and me, uh, doing it, uh, sitting in Tamar's living room. But we, we studied the market. We studied, okay, what is a commercial company? What is a startup? Why are some startups do really well? Why do others, uh, uh, fail? What does it mean to fail? What results do they need to deliver? Why are customers buying cybersecurity products? What do they think they're paying for? What are they actually getting? What's the difference between what it says? Uh, on the big company's marketing pages that pretty much proclaim, they do everything on the planet, uh, uh, and what [00:10:00] customers actually do with these products.
So we had a lot of studying up to do.
Logan: And at, at a literal level, like how do you do that? Are you just cold emailing people? Hey, I, I was at, uh, Taio and now I'm interested in why you buy a cybersecurity solution? Or were you networking through your, the folks that you had from, from 8,200 I.
Yotam: So And a lot of just reading, Like we just spend a lot of time reading up on spaces and the data security was one of the spaces we looked at initially. We also looked at several other spaces. What's the history of these spaces? Where did they come from? What's the problem they're trying to solve?
How well have they solved it? big are the companies that are doing it? Are they on the way up? Are they on the way down? is the, we try to study to start to learn what is a market? is a product market fit, right? I think. For me, a lot of it was, was brand new and you know, we were, we were pretty good learners, so we just focused on learning.
A lot of it came from people in our network that were [00:11:00] willing to spend time with us and teach us or share their experiences with us. But a lot of it was just sitting our asses down and reading
Logan: Do you think having like No. Uh. Prior pre, uh, uh, predisposition to like how the market existed in some ways. Was that, um, advantageous and sort of looking clear-eyed at the problem? Or is that just, sounds like a good narrative and probably you still had to learn all the stuff
Yotam: what a wonderful question I have no,
Logan: don't know? Listen, it seems to have worked out. Uh, so, so I don't know.
Yotam: think like I would say that, you know, there were other spaces that we considered like entering. For me, one of the reasons that I, I, we chose data security was more of an emotional reason, right? couldn't feel it with that spaces. Like I knew there was a problem, the problem was logical. Customers validated that there's a [00:12:00] pain and a problem. But I couldn't feel it in my gut that like, this is, like, this really, really, really hurts me. I think that, you know, here we are almost five years later and when I ask, you know, one of our champions, you know, very big account, we are walking in, you know, you've got so many problems, why are you spending time with say, why are you looking at solving data security?
It tells me, Yuan, you know, what's the worst thing that can happen in my company? When you get a question mark email from the
Logan: CEO.
Yotam: right? On something that happens and when there's data incidents and data leakage events and da, like that's, that happens all the time. I wanna, I wanna eliminate that. I want that to not happen.
I wanna solve this problem for the company. It matters enough the CEO cares about it personally. that was, back then, it was more of an emotional, empathic kind of understanding that it was facts,
Logan: Hmm.
Yotam: We didn't have the facts. This market was very early.
Logan: The fact that you ended up landing on this [00:13:00] problem set, uh, what drew you to it? What was that emotional sort of element of, uh, that that appealed? I.
Yotam: So I was literally thinking about like what it means to lose your data to, for your data to be stolen. What does it mean on a personal level? Do I as a person to have information? Do I have data that I would not like others to have? Then I would not like to be publicized on some, uh, uh, website on the internet. Yeah. The answer is yes. How much do, would I not like that a lot, Like, uh, some of my
Logan: Depends what data.
Yotam: Yeah. No, but I'm saying I have data
Logan: Yeah, yeah,
Yotam: to remain my
Logan: yeah. Your browsing history maybe. Yeah,
Yotam: I'm not there.
Logan: yeah, yeah. No, there's probably some military.
Yotam: pictures back from
Logan: Yeah, exactly. Yeah, yeah, yeah. For me, it's college. For you, it's military. Yeah. Yeah. Yeah.
Yotam: know, those things, uh, need to stay where, uh, where they belong.
And that's on the personal level. And then you think about it on the organizational level, you know, when you think about, okay, is there information in the organization that I really [00:14:00] care that it's not gonna be public? Is there information in the organization that I really care that every employee in the organization won't able to, won't be able to see? Is like, and that then ties to regulation and from the world and, uh, you know, banking regulations and healthcare regulations and many other things that have come to institutionalize this. But if you think about it, it's a very, very natural human thing. We wanna be able to protect some information about ourselves, about our business, about our, what we do, and what we don't do. Organizations share that sentiment and they share it in a very primal way.
Logan: Hmm. And, and so, so you landed on this problem set. You, uh, got looped in with folks over at, uh, cyber Starts, Lyor and, and Gilly, and uh, and then Sequoia ended up coming in as well. L So, so maybe take me through, how did you get to those folks? And then take me through the initial, this is sort of peak erp, uh, fundraising, right?
So maybe give, give the early fundraising story.
Yotam: Yeah, [00:15:00] so I think, you know, it all started Tam and I was still, uh, you know, unincorporated. We didn't even have a, a legal entity and we got preempted, uh, with a term sheet by another firm. And that essentially plunged us into a seed funding ground. we met with, uh, with Gilly and with Leo, and, uh, we clicked we chose to, to go with them, a choice that was very, very, very meaningful. Uh, we didn't even know how meaningful when we made it back then. But their coaching and their mentorship was critical to, to the company's success, to our success as founders and being able to, to get this, uh, rocket ship to, to take off the, from the ground.
Logan: I, I normally don't allow commercials, uh, for other venture capital firms, uh, on this show. I, uh, normally bleep it out, but I guess I'll go into that a little bit. Uh, I'll make an exception here. Like what, what did they uniquely do well for you, uh, in the early days and sort of help you refine what sir is?
Yotam: so I think they had product [00:16:00] market fit of their own in the sense that they've built an engine to take founders like Tamar and me, which are ex engineers, engineering leaders, uh, from the, the, the Israeli ecosystem, which was in very much not commercial in a very, eh, orchestrated, managed, but quick. Way, uh, commercialize you, turn you into a commercial founder for a commercial company that needs to sell, needs to conduct business in the market. And, you know, in a year's time we moved from being, uh, clueless to raising an A round from Sequoia Capital with Doug Leone and being able to, uh, convince Doug and Bog Mill and the Sequoia team that we know something about the world, uh, that they, that they chose to invest. So that, that transition, being able to go through that transition in a year was, the, the foundational value [00:17:00] proposition for us, us how to talk to customers, how to find pain in customer interactions, how to tie that pain to a commercial engagement, how to, uh, iterate on the product, how to bring a product to market in the early days when you know what you have to offer the customers is quite limited. And, and, and really how to, to build that initial traction and initial engagement in the market. That allowed us to, start to, to go.
Logan: Yeah. And, and so, so they, they did the, I guess I think it's technically pre-seed round or the seed round of it. And then Sequoia, I think nominally they, I think we call it the seed round, but it was, uh, it was a big seed round, uh,
in a round ish. Yeah. And so, so those, those folks came in when, how, how long after cyber starts?
Yotam: It was a year,
Logan: A year. Okay. So there was a year in there. Uh, and then, uh, there. It, it was a little bit of a different selling market, uh, for the first year of the journey. So maybe give me, gimme that so you're coming hot [00:18:00] out the gates. You have, you know, the, the most venerable firm in Israel investing, one of the most venerable firms in Silicon Valley history, and one of their, their best investors ever joining the board and then Excel and fantastic form following very shortly thereafter.
And so off to the races, no problems. And then what happens?
Yotam: Then we are a terrible year.
Logan: And then, then
Yotam: Then we had a terrible year. moved to the states. Uh, we went through like a go-to market transition. We tried to hire a team. It wasn't the right fit for where the company was in terms of stage and, uh, and product market fit.
Logan: what was that, by the way, I've never actually asked, I mean, I, I know the numbers of that year, but like, what, what was it that was off? Uh, for those 12 months or?
Yotam: did something like 1.5 million, that year.
Logan: Not, which is amazing for, you know, if you're grading on a curve of almost every company. It was a, it was a very good year, but you guys, uh, had raised a very expensive, uh, you know, [00:19:00] set of rounds and, uh, I think had far more ambitions.
Yotam: I think, uh, we expected to do, to do much better that year, and we expected to, to pour guests in the market better. Uh, and it was very, very, very hard. I think, uh, acclimating to the, to the market and being able to, to create that initial pipeline and initial engagement and drive the product forward and attract talent in the US and really, you know, get the company off the ground in, in terms of go to market that year was a, was a very difficult year for us.
Logan: did you learn? I guess, if you were to impart a lesson or two lessons from that year to someone that's listening and maybe trying to figure out how to reach a scale of growth. Like you guys had obviously a, uh, wind at your back, uh, in terms of some of the themes, but, uh, you had to catch the wave, so to speak, and get on it.
And so I guess, what did you learn about that?
Yotam: So I think the first lesson that, you know, might sound very [00:20:00] trivial, but for me it was not trivial back then is that, uh. In the early days of a product, of a market, VP sales is not gonna solve the problem for you, right? You, you, you hire a VP sales and they hire a team, but it's still your problem as a founder and it's still your responsibility as a founder to go and drive the go-to market in every aspect. And in those early days, you don't even have enough at bats actually let the team take a swing like you have to be in every call because you know you don't have enough opportunities that you can let somebody who join the company four weeks ago take a call with the customer and then, you know, if it works out well, it works out well if it's not. So you have to really make magic happen in every EBIT of pipeline that you have. And you know those customers that do have the problem and are interested and are willing to partner with you even though you're very early stage. You have to, to make the magic happen. And it takes one call to win [00:21:00] an enterprise customer interaction, and, uh, maybe 40 calls, uh, or meetings to, to make it happen. They have to see you in person. They have to see you in person a few times. They have to believe in you. They have to believe in your mission. And that I was naive, like in the first go around, I thought like, oh, okay, we sold a few deals. We have a few customers. They're starting to use the product Uh, somebody who knows how to sell will come in and sell it. that didn't really work. I think that the whole notion of it wasn't, wasn't completely, uh, calibrated to to reality. And I think that I've learned that, you know, I'm personally involved together with my co-founder with Tamar in the business. In every aspect, right? Like, that's what I, uh, do most of my time. Uh, I spend with customers. as the company progressed, I spend my time more and more with strategic customers, but I spend my time with customers all the time, [00:22:00] and I'm always happy to, to get on a call with a customer of any size and get to know them and get to know why they're looking at us, what they're trying to solve.
It's also my way of steering the, the company in terms of product, right? I am very, very much attuned to what the customers are thinking about the product, how they're thinking about the problem statements, and I validate that on, you know, five to 10 customer calls a day. So I, I have a very, very clear picture of why people are choosing us, what they're doing with our product, what they wanna be doing with our product. And according to that, I, I steal, uh, a lot of the efforts in the company.
Logan: Was the product, uh, in the market there and it was purely like a sales execution thing, or was the market not quite ready for it or the product not quite ready?
Yotam: was definitely not quite ready for it yet. Right. I think, uh, we were coming out with this DSPM positioning, which was new to the market. It's not like types of problems haven't been addressed before
Logan: Yeah. May maybe [00:23:00] give people a little bit of history of D-D-S-P-M and like what that actually means, and like they, as you did the studying and what the space looked like.
Yotam: so we were entering the data security space. The data security space, if you look at it, uh, from a zoom out lens, probably has billions and billions of dollars of existing spend. The primary spend has been on DLP data loss prevention. These are like, uh, controls that are trying to stop the data from getting outside of the enterprise into the wrong
Logan: Yeah,
Yotam: But those programs, those DLP programs were quite painful for many of our customers, for many of the enterprises in the market because the false positive rates were super high because the total cost of ownership of this program was outrageous.
Logan: to give an example, I'm at a big bank. This actually had this at one point and I'm trying to send a file externally to myself or something, and. You know, I, I, maybe I just need it for, maybe it's a personal file or something, but it's over 10 megs and so they flag it. Now someone needs to look at it and approve, okay, actually Logan was just sending something [00:24:00] stupid.
And so all the false positives of that stuff. Picture trying to upload it to a Google Drive or Dropbox, or dealing with all the different controls that you could have.
Yotam: challenges at the scale of 50,000, a hundred thousand employees,
Logan: Yeah,
nightmare. Yeah.
Yotam: So, and, and we tried to understand what was changing in the data security space, as in, in that time the impetus, right? Like the big change was the move to the cloud. So if you think about it, these organizations would tell us, look, we never knew exactly what data we have or where it resides, but it was all in our garage,
Logan: Yeah.
Yotam: right? And that's a pretty good feeling. And today
Logan: it was, it was much simpler when you could, you could look at some of the stuff as it went to the cloud because hey, it was within our drives. If I was at Morgan Stanley and it's at my drive, and now something's going to the cloud. And like, okay, let's look at that. But now when it's cloud to cloud, like what do you do about that stuff?
Yotam: and the move to the cloud essentially created a loss of control over the data, right? Like it's no longer in my data center. I don't have a network, [00:25:00] don't have the ability to inspect it and choke it through the network because it's sitting in somebody else's cloud, that's in SaaS or in ias. And that was the, the, the event that was happening back then. what we did is we plugged on into that event and we told them, okay. The cloud has many, uh, dangers, many risks in terms of security, but it also has many advantages, and we can actually turn the fact that the data is in the cloud into an advantage, and we can use the way the cloud is built in order to connect to the underlying cloud provider and from that position in an agentless manner. Show you all the data you have there and assure that the data is secured as it should be secured. And that was the initial, that's what, where the company started doing that, doing it at scale, doing it fast. And you know, our first version was AWS only. So we could pretty much just light up the data in the AWS Luckily enough for us, there were enough customers in the world that had that specific problem, and it [00:26:00] was an urgent enough problem that they, they took a bet on us, right?
Like, eh, were many customers that didn't care at all, right? no, we don't have AWS or we don't have anything important in AWS. So, you know, we have so many other environments, if you can only take care of AWS talk to us in a couple of years. But there were some customers that were in that position where they cared enough about that specific problem that they gave us a shot,
Logan: That was actually, I mean, when we invested, uh. And, and, and by the way, I don't know causation or correlation, but the business has, has, uh, you didn't have any bad years after we invested, so I don't,
no, not even a bad quarter. Everything's been up into the right. So I don't know who's to take credit for this, but I will say it was actually a pretty simple thesis of like, uh, data volumes just keep going up.
Cloud, uh, is like an accelerant of that. Uh, and more stuff is going to the cloud. And then security is increasingly important. And we sort of, those are like the three sort of simple primitives of it, and we think this team's best to execute on it. And then, and we'll talk a little bit more about this, but then AI could be an [00:27:00] accelerant for all of these things in some way.
Uh, and I think that's proving out, but it was actually pretty simple. It wasn't like we, we didn't spend a ton of time thinking about like, is this gonna be the case? I think the question then becomes how big can it be if all these things happen, which is always a question in our jobs. But
Yotam: yeah, so I think it can, uh, it can
Logan: so, so that was the, so that was the premise behind it.
So, so, so. Fast forward today. So, so it was a, it was a initial tough year and, uh, then things were off into the races and, uh, may maybe give the, the journey through that point.
Yotam: Yeah, so I think, you know, Steve Rock, joined as our, as our sales leader and, uh, and managed to start with attract talent and he managed to, to do something that when we started, we never imagined we'd have. He, he managed to create excellence in go to market. He started bringing on people who were very proficient, uh, account representative sellers. [00:28:00] They were very smart, they were very curious, they were humble, smart and hungry. And, and they started, uh, delivering results. I think Tamara and I stayed very close to the, to the sales, very close to the customers in every stage of the, the process, right? And we still are today, but we, we gradually saw that these people are ramping as, uh, you know, people tell you in the model that sales reps are supposed to ramp, right?
They come in, they learn the ropes, they learn the talk track, they learn, uh, the q and a with the customer. They learn, they, they learn the product, they learn the value proposition of the product, and then they start running off on their own and making magic happen. you know when the magic starts to happen at the beginning, you don't believe it, right?
Like, you know, a customer you never met, signs a deal. You're like, nah.
Logan: Awesome.
Yotam: been like, it is probably somebody's cousin,
Logan: Yeah.
Right. This is, this is, you added a zero here. It's not, this must be 30,000, not 300,000.
Yotam: know, one of the sales guys who was uh, already doing well was [00:29:00] telling me that he's going to, to close a deal for $3 million a year and with a company that's not regulated. And I'm like, come on.
Logan: Yeah,
Yotam: on. If you close it for a million dollars, I'm like, build an altar with your picture
Logan: I like that.
Yotam: $3 million. Come
Logan: Yeah. And now that alter's up there and, uh, you pray before it. Yeah.
Yotam: Keep his, uh, keep his picture in my wallet
Logan: exactly, exactly. It hangs from your car, uh, as you drive. I'm curious, so what, on the recruiting side, what do you think Steve did uniquely well to bring in those talented people? Obviously product market fit and all that stuff, but like there was a nexus of early talent density.
Do, is there anything that you guys think you uniquely Yale nailed?
Yotam: Yeah, I think, I think he knew, like he knew what a great salesperson looked like, he knew that at this point in our journey. great salespeople would actually succeed. And like, uh, the market was too early, the product was too early. It's, it wasn't easy [00:30:00] to sell it, it was possible to sell it, and you can even sell it for sub substantial dollars. uh, you needed people who really, really, really cared about the customer and were able to, to do the work. It wasn't like, uh, you know, you're just, uh, shipping CDs and you need somebody to, to fulfill the demand,
Logan: Yeah.
Yotam: Like you had to do the work with the customers to understand what they're trying to achieve, how the product can help them achieve that and be able to, to drive the, the project in. And he knew what great looks like. And he was very, very, very determined to go after greatness and, and bring it in. And, and he started to do that. And we started seeing things, uh, pick up. And I think that all of us together as a team came together around opportunity to, to start to launch this company into a much more meaningful growth trajectory.
Logan: Mm.
Yotam: So, you know, it was a small, intimate company. were already in it. They, they liked it. They liked us, they believed in it. [00:31:00] uh, Tamara and I pretty much, uh, rallied the team around the opportunity to, to blow it out of the park. And I think that that was a big part to make everybody feel like they're a part of the company's, uh, ability to succeed and become an outlier. And we were very clear about what it requires to become an outlier, right? Like, what are the results we all need to, to make happen together? It was very clear that those results were not to be trivialized, right? Like it was no, there were no guarantees that we are going to be able to do that. Uh, but the team came together, everybody put in, know, 150%, and then we managed to start to create that flywheel of momentum that is, uh, has really continued since you invested
Logan: I know, I know. Uh, besides me investing, uh, if you look back, what, is there a moment that you reflect on and you're like, yeah, that was really, uh, when it shifted from maybe rowing [00:32:00] against the, uh, the current in the, uh, in a boat, uh, to now the current was sort of helping accelerate you in a meaningful way.
Is there a deal? That you look back on or hire or something that it really sort of felt like it tipped.
Yotam: There were many moments like
Logan: Yeah, I'm sure every time it's not easy. I know, but I don't think it,
Yotam: I think, but there's many moments where you're like, wow. Like I never expected. To, to see this,
Logan: and then it becomes normal and you get used to it and you move on.
Yotam: it, it's like, I always joke, I, I tell my wife that we're kind of doomed in this position where I'm always, uh, uncomfortable because that's my job to, to make myself and to make the company very much uncomfortable.
Yeah.
Logan: Well, I mean, some of the, some of the, I guess that's a good point. Some of the growth that you guys have had on the headcount side, on the revenue ambition side, all of this, it, it makes me as an investor at different times uncomfortable. Uh, just because I think you're, you're defying, um, uh, gravity or [00:33:00] physics in some ways with how fast you want to go.
Logan: What, what do you. Why do you feel a, um, pressure or an insatiable desire to go at the, the, the pace that you're, you're executing on?
Yotam: Wow. There's, there's a few reasons for that. I think the first one, uh, in my mind, right, and you might not like to hear it as an investor, but for the people that work for the company, my job is to create a return on investment, which is a return on time. So, you know, you invested the dollars, but they're investing time my job is to create an incredible return for them
Logan: Hmm.
Yotam: on their time. They're giving me some of the best years of their careers and much of the best hours and of their life. They're giving it to the company and I wanna create an amazing return for them. time matters a lot. I think the second thing is what Frank told us in the, in the last board meeting, you think it's hard to go fast. It's much, uh, much easier to go fast than it is to go slow.
Logan: Hmm.
Yotam: It allows you to differentiate more from [00:34:00] your competitors. It allows you to excite the market. It allows you to, to continue to garner support from the venture capital community. So, going fast, while it's very, very, very scary in many aspects, it actually helps you avoid friction.
Logan: Hmm.
Yotam: It helps you lower the friction, and it helps you win.
Logan: For people that don't know, Frank Sluman, uh, I think the iconic name and software, uh, you know, CEO and certainly sales and execution and all that. Um, it, it, I, I mean, it makes sense. How, how do you think about the throttle of how aggressive to go on this? Like what is the, the breaking point of how you set goals for people internally of like, Hey, this feels super ambitious, but potentially attainable, versus is it like 50% confidence?
Is it 25, is it 75? How do you think about goals?
Yotam: So maybe as like a third generation Holocaust survivor. That's how I think about many things in the world, right? Uh, I risk manage, [00:35:00] uh, I think that, you know, at this point in the company's life, private company, Uh, we don't report to, to Wall Street. We report, uh, to the board, and it's a pretty intimate group that is much in the details of what's going on. you know, uh, as much as everybody loves the, the beaten raise, beaten raise negative, I think like we do have the ability to hold a bit of a more intricate negative
Logan: Yeah.
Yotam: within our, uh, structure and within our, uh, like oversight structure. I think that I like to, to put the goals for us at this stage, at a place that, first of all, makes me uncomfortable, right?
Like I'm saying, wow, it's gonna be really hard to, to do that. same time, I have a high level of confidence that we're going to be able to at least do 80% of that, right? And I also risk manage from a financial perspective, does the company look [00:36:00] like If I only do 80% of the goal, am I, did I, did I mess up the company?
Did I do something that puts us in a bad position? And I wanna make sure that even if we only do 80% of the goal and I'm setting for all of us, then, then it's still. We are still in an exquisite position. We're still in a, in a wonderful position, right? So I want the goal to make us all stretch into it and make us, uh, uh, you know, feel like we are leaning out of our skis. And at the same time, you have to risk manage that. If you're doing that and you know, something doesn't come your way and you, you end up doing a little less, you are still very happy about the financial structure that you created.
Logan: And does that mean a hundred percent confidence of 80% the number, or do you think 80% confidence, uh, of getting.
Yotam: a hundred percent confidence, right? Like, uh, is, uh, reserved for fools. But
Logan: Yeah, yeah. But still, I mean, when you're thinking about like 80% the number, you're trying to have some high confidence.
Yeah. 95% or so. Something that
Yotam: 90, in [00:37:00] 80% of the goal and confidence in the ability to, to do the goal.
Logan: does that trickle into other parts of the organization, uh, as well? Like, do you guys set, uh, goals like that within, I don't know, EPD or, uh, marketing and that these are very ambitious goals and that, you know, we're gonna strive for a hundred percent, but
Yotam: think that mentality does trickle, trickle down, right? Uh, and generally I think it's positive. I think generally, I think that, you know, building a, uh, a great plan and, uh, achieving even all of the plan is, uh, it's a pretty good tactic, uh, for most of the business units.
Logan: Uh, if we're gonna zoom out a little bit on cyber security of the market, one of the things that I think has historically been said about cyber is it's really, um, there, there's a lot of paths to exiting for a couple hundred million bucks. And it's a good place to build point solutions. It's a really hard place to build five, $10 billion plus companies.
And, and [00:38:00] the number, uh, I I, maybe we can come up with the, uh, as we talk here, but there's, I don't know, probably three to five companies that are over $20 billion in the last 10 years maybe, which is big in terms of the absolute numbers. Uh, I'm thinking CrowdStrike, I'm thinking Palo Alto Networks. I'm thinking Zscaler.
I'm thinking we, we, we can come up with the names, uh, but um, I'm curious, how do you think about the cyber landscape today? Do you think? A question I had asked you, uh, a few years ago or, uh, maybe a year ago was like, how many I. $10 billion companies, do you think there will be in cyber in five years time?
Do you think that's a few? Do you think it's dozens? Like how do you sort of think about the rate of opportunity there is for cyber?
Yotam: I am a very big believer in cyber, uh, for several reasons. So it starts in my mind with like the foundational paradigm of cyber most of the things we do in our lives as companies, as individuals, [00:39:00] we get measured on how well we do on average in cyber, we get measured on our weakest link.
Yotam: That's a very different paradigm, that's the fun, the, the fundamental paradigm that creates an endless opportunity in cyber. So while a mature enterprise today might already be an average of eight out of 10 on the cybersecurity, uh, uh, program, it's enough that there's one weak link that is a two or a three, they're very much exposed. So that's something that is fundamentally different in the paradigm of how cyber, uh, effects or how it comes into friction with the world compared to many other topics, many other things we are doing where the average is what matters.
Logan: Hmm.
Yotam: I think that that's like fundamentally creates a huge opportunity for entrepreneurship and innovation because, uh, companies and organizations get measured on the weakest link.
Logan: Does that, does that lend itself to best of breed [00:40:00] solutions being worth more and more? Uh, yeah.
Yotam: it mostly lends itself to that to say that if I have a big enough problem, like if I have a problem that is a two or three and I think it's a real problem, then I have to find a solution for it. And if the, the big providers will only solve it in three years, it's three years of exposure that I have right now.
And like, that's probably going to mean a breach.
Yotam: So, you know, it's a cat and mouse game between the defenders and the attackers and time, time multiplies everything. So, you know, many topics, I would say, ah, my HR system will be, you know, there's a, a niche, uh, AI company here that is doing something amazing for HR that could have such efficiencies for me. But my, my bigger HR provider will probably take care of it in, uh, two years from now. Okay. So that's two years of less efficiency. It's not two years where you are exposed to a
Logan: Yeah, there's a risk.
Yotam: potentially, like damage your company [00:41:00] substantially. So there's, there's a fundamental difference in why cyber is so appealing for innovation.
It's not just because of the exit, uh, uh,
Logan: No, uh,
Yotam: because the CISOs think that way.
Logan: well, and, and I, I've thought that there cyber's a weird one where there's a two by two, uh, kind of matrix. And for people listening, I, I, I'm doing it with my hands. But basically, uh, most, most industries, uh, if you need to be on the cutting edge of something, uh, you won't get fired for, uh, picking something that's innovative.
Uh, and so, hey, we're gonna buy a new AI SDR tool and if it goes wrong, you might fire off a few emails that you don't like and you're not gonna get fired for it. You shut it down and it's like, okay, we're not gonna do that. We tried it. It was interesting, you know, whatever. It didn't exactly work, uh, or.
You could get fired for it, but you don't need to be on the leading edge of it. And so it's like, Hey, we're implementing a new payroll system. And uh, it's like we're not gonna go test the new payroll system out there because, you know, if this goes wrong, I'm probably losing my job for it. [00:42:00] Cyber's a weird one where you both need to be at the leading edge of innovation and you can get fired if it goes wrong, which I think leads itself to a lot of things.
You're talking about
Yotam: I in general, is a very volatile workplace. And like, it's very hard to be a ciso. I think these people, you know, deal with so much challenges internally in the organizations, uh, a changing attack landscape, Like a changing it ecosystem. They have to protect. it's a very, very, very challenging, uh, job for, for any person to, to have to secure these organizations is a challenge.
Logan: the people that do it well, uh, within your customer base besides buying Ciara. Like what? What traits do those people have that, um, lends themselves to being like, you know, good at at their job?
Yotam: I think that usually I see a lot of people who have like, uh, first principles thinking, They try to choose relatively simple principles that they believe are core principles to [00:43:00] securing the enterprise and scale them very well and keep the, their principles relatively simple, right? Like they, they. They find, uh, a way to take this very complex space that is cyber and turn it into something relatively simple that their teams can understand, rally around, and just execute on in a very, very, very meaningful way. Scale it to every part of the enterprise, which in the big enterprise is very hard. And again, it comes from that same, uh, topic that you get tested on your weakest link. So you, you know, you can have the most sophisticated, uh, plan of defense ever, but if it doesn't actually extend to your entire enterprise, you're still gonna leave exposures out there that they're going to be taken advantage of. So the, the best CISOs in my mind are kind of like first, uh, first principles, thinkers. They take very simple principles and they scale them.
Logan: When, when you're thinking about like the, the opportunity for Ciera and therefore the opportunity for [00:44:00] other cybersecurity companies, like what we said earlier about best of breed, how do you think about adjacencies to potentially go into where to stop, where it's no longer a core competency of what you're doing necessarily and you don't fall victim to the platform?
Uh, fallacy of, you know, I'll get to it in three years.
Yotam: Yeah, so it's a great question and I'm not sure I have the answer today. I like, I think we're still so much on the expansion part of the story that I'm not sure I know where we stop or uh, where the line should be drawn. it is very important for us to keep two things as our principles while we are expanding. And those two things are first of all, a platform approach. And what I mean by that, I mean one plus one equals three. If we are developing a new product and it's one plus one equals two. Then it's probably not the right investment for us. Uh, like if there's no additive value, [00:45:00] meaningful additive value from having these two capabilities, uh, integrated in one platform, it's probably better to leave it for somebody else. So that's the the biggest question Tamara and I ask ourselves on every new investment that we are making as a company, are we going to create a one plus one equals three situation for our customers here?
Logan: You know that intuitively, or do you, do you hear that from them or is it both?
Yotam: I I think that in every type of like product decision, product strategy decision, we always default to the customers as a, as our sanity check, Like, uh, you know, that's been a, a method from the get go starting in this space to, to be able to really ask the customers, uh, the, the hard questions and get to the tools from them. And that has always been like a very honest compass for us to, to steal the ship around. I think that as Ciera as a company becomes more complex, we do need to, [00:46:00] to make it accessible for them. Right? Like we do need to ask them, okay. Like to show them the Ciera perspective on this. Sometimes wouldn't be able to, to comprehend the one plus one equals three out of the box.
We'd have to explain like why we think there's going to be a one plus one equal three situation here. And they'll tell us, Hmm, that sounds really good. I'd love that. Or, Hmm, you're full of shit. Like, those things don't really go together. Like, it's a nice story, but it's not gonna work in my
Logan: Hmm.
Yotam: lemme tell you why. So they, they, they're very good at like keeping us grounded. To, to the facts. And they're also very good at centering us on the core value proposition of Ciera. So whenever we bring our advisory board, our customer advisory board together to, to review the roadmap and review the planning sessions, you know, the message that is always portrayed most loudly is expanding the platform is important.
It's wonderful. We want you to solve more problems, but the most important thing is that you will continue to [00:47:00] solve the problem we bought you for in the first place, amazingly well.
Logan: Hmm,
Yotam: you'll find more and more ways to do that better for
Logan: hmm,
Yotam: So, you know, that is always the message from the customers. Sure, expand, grow, but double down on the call.
Logan: hmm. As, I mean one of the things that you, um, had to fight in the early days is I think you need to. You want to establish yourself as a platform or a best of breed solution faster than the incumbents can try to box you in to being a point solution. Uh, and, and trying to frame the market as like, no, this isn't best of breeded, we do this.
In selling against that, um, how, how do you, how have you guys been able to successfully sell against that? To get to the point now that it's pretty clear you are a platform.
Yotam: I think that like, that goes back to the speed, right? The, the, the ability to create momentum, the ability to, to create speed velocity. That's [00:48:00] what allows you to, to start to set yourself apart. We acquired a company last year for $162 million if you would've told me that when Sayara will be three years old. We will acquire a company for $162 million. I would've told you, you drank, Like I wouldn't have believed it. But I think that the reason we did that is because was an accelerator. It allowed us to grow the momentum. It allows us to grow our speed. It allowed us to expand faster and in a way that doesn't eat up from the core resources. So, you know, is us acting in what I see as extreme ways in order to create velocity and to continue to drive forward at speed. The incumbents have no way to compete with that. They're fundamentally, like their position in the market is much more established and it's much slower. It's much harder for them to, to create momentum where it didn't exist before. It's like anything either, [00:49:00] you know, company's growth doesn't usually go up the company scales and becomes bigger, the growth goes down, so does the velocity. So we are definitely leveraging our advantage and our position in the market to use that and emphasize on speed and double down on speed and use it as a way to, to completely, you know, the market in a sense.
Logan: I want to ask about that, that, uh, point a little bit more, but as we're sort of thinking about the broad based, uh, market today. Uh. One of your, um, I guess shared, uh, background. Wizz is an example of a business that, uh, also they were Taio, uh, they were cyber starts. They were Doug and Boga Mill as well. So a lot of shared lineage between that.
Um, obviously, uh, uh, the news came out earlier this week. They were being acquired for $32 billion. Um, I'm curious, like one, what's your reaction to something like that when you hear it, what do you think about implications for the cybersecurity world?[00:50:00]
Yotam: I think it's amazing and like, uh, first of all, super, super happy for them. uh, you know, they've rocked the cybersecurity market, uh, in incredible way, I think that it's extremely exciting to see validation that commands a premium in the world. like that being able to do something that is extraordinary and gets rewarded with a premium, uh, in, in the sense of this acquisition. And for us at say, I think that's something we definitely believe in as well, that doing, doing something extraordinary is worth much more than doing something ordinary. And I think that for the cybersecurity market, it's, uh, honestly, it's a bummer, right? Uh, Wiz was, uh, a rising star that many customers looked at as the next, uh, great, uh, platform in cyber. uh, for their reasons, they, they chose [00:51:00] to, to partner with Google and become part of that. And I think that, uh, the market is, is not gonna be all too thrilled about it. Um, for many reasons.
Logan: Who do you think Wiz, uh, got super right? Like if you were to pick a. Uh, thing that they nailed. Uh, and, and you know, that led to the level of success. I know there's a lot of 'em, but.
Yotam: So I think there's really many things that they did amazingly well. of them is velocity, creating momentum and, uh, driving it forward at an extreme pace. And another one that is a bit more core to, to the way the product operates and the way it's implemented in these, uh, enterprises is that they managed to democratize the risk, which is something that we are doing also for the data security aspect. But they managed to a platform in which the developers, which actually need to solve the problems, fix the problems that, uh, their platform identified. the developers [00:52:00] are able to do that within their ecosystem, and they like doing that within their ecosystem. And that allows the security team to put this product in place and enable the business, the application owners, the developers in our world, the data owners, to go and take ownership and responsibility for the risks in their, uh, under their, uh, purview and solve those risks through the platform. So I think that that is one of the, the most core elements to, to their success in the market and something that we believe in as well. And we believe that it's the only way to actually scale security in the enterprise.
Logan: Ai, it's, uh, it's something people talk about. I, uh, I'm curious when we spoke, like, I don't know, a year ago.
Yotam: joke about AI nowadays, uh, with the teenagers,
Logan: No,
Yotam: that AI is the same as, uh, sexes for teenagers. Everybody's talking about it. Very few people are
Logan: that's good.
Yotam: the ones that are doing it are doing it wrong.
Logan: I hadn't heard that. I, uh, I, when I, [00:53:00] when I had asked you about it, I don't know, six, maybe a year ago, and I was like, you know, typical vc uh, bullshit, maybe. I was like, well, we should, we should glom onto some of this, like. Marketing, uh, and get ourselves out there as an AI first vendor. Uh, and, uh, I think at the time you're like, listen, by the people we're selling into, more often than not, they, the old adage is like, it's, it's called AI when it doesn't work.
And then it be, it's machine learning when it does, and then when it becomes invisible, it's an algorithm or something. Uh, and so I don't know if that's where people were in the cycle of time, but I'm curious as you look at it today, like, uh, what is the risk of ai, the opportunity for ai, what's going on with AI insecurity?
Yotam: So security in general, you know so many things. I think in our world specifically, it's for us the ability for CISOs support the [00:54:00] adoption of AI in the enterprise and to make it into a responsible and secure process. That is the call. A driver for our success nowadays, The, the reason, uh, we are getting, uh, budgets we're getting from these enterprises, the reasons they're investing in this topic is just that, right?
To, to be able to support the adoption of AI in the enterprise in a secure and responsible way. And when, I view it or when I think about it, you know, people are, are not gonna slow down. Like security is not gonna block AI any way. AI is happening and it's going to happen big. But if we can, as a security industry, help help it happen, secure, securely and responsibly, like that's our most important mission in the world right now.[00:55:00]
Logan: That's internal to the, I wanna talk about the external ai, but, but this is internal right now. Is it just making sure that the, the data and the systems are all in place for people to then be able to take more generative actions on top of the data? I.
Yotam: Yeah, let me take a step back even. Okay. You, you, you look, uh, we are sitting here in New York City, right? Like you look around at these buildings and all of this, uh, you know, civilization, if you will. And it looks so stable, right? Like it looks so solid, That the buildings are made of stone and the institutions are strong. You know, the, there's a Credit Suisse, uh, building, uh, in the city that looks like a fortress. You
Logan: Yeah, yeah, yeah, yeah, yeah, yeah. Sure,
Yotam: Literally looks like a medieval fortress. Sure. And I'm saying like, that is so symbolic 'cause that's what you want a bank to represent. where is Credit Suisse? It's not a
Logan: Yeah.
Yotam: Yeah, it's done. It's dead. Like, and [00:56:00] how fast did that happen? that an institution that we looked at that wanted to portray to all of us that it's a fortress that is robust, that is, uh, sturdy, that is reliable, disappeared off the face of the planet in what, uh, fell to me like, uh, two
Logan: Yeah.
Yotam: So that is the hard reality that people do not wanna face about the modern world we live in. It's not as robust and not as sturdy as, uh, we don't like everybody to
Logan: Hmm.
Yotam: And within that, the ability to trust in these institutions, to trust when you're putting your information into whatever system it is, whether it's a healthcare system or a finance system, or a retail system, and that that information gets treated with some level of decency, know, security being a, a big world here, But that it's not being sold to, to a online marketers and it's not being sold, like the ability to trust. It is not to be taken for granted in [00:57:00] society. And I think that if you look at it from a macro trend, the introduction of AI into the world is going to challenge that in a very, very big, big way. If I no longer know if I'm interacting with an AI engine or human being on the other side, that does something to my trust, maybe I'm getting a better service from the AI agent than I did from the person that was answering that phone two years ago. I'm not saying you, you are not, it still changes something about the foundational trust that we have in each other and in the institutions. So when I look at the job hiring the role of cybersecurity data security in the next few years, it's making sure that this transition doesn't crumble the digital trust that exists in the world today.
I don't want my kids to live in a world where you cannot trust institutions. That's a crazy world, and it can happen quite quickly, right? Like it's, it's, uh. the line is not that thick very quickly. We go from a [00:58:00] world where these institutions are trustworthy, reliable, uh, dependable to a world where they're not. And from a values perspective, from a mission perspective, that's what say is about in the world.
Logan: Hmm.
Yotam: about enabling this, the modernization to happen. 'cause it's going to happen anyhow, but enabling it to happen in a secure and responsible way.
Logan: Hmm. And so, so the extrapolation of that point, then, I mean, it makes sense and I think institutions are far less trusted than they've ever been, either rightly, right? Rightly in a lot of cases, and wrongly in some others. But, um, your role in that, uh, and how you think about it is, is what S'S role.
Yotam: Sarah's role is in allowing enterprises to put the right controls around data, which is pretty much, uh, AI's, uh, favorite, uh, meal. Uh, to make sure that the adoption of AI that is happening turn the, doesn't, uh, make the data exposed in ways that it shouldn't be exposed, [00:59:00] right? Uh, you know, you have a, a big healthcare provider that wants to put the PHI into their internal LLM engine that's supposed to accelerate their ability to service the customers. If the result of that is now that every employee of the a hundred thousand employees that work for that healthcare provider can now access every p every person's, uh, PHI, that's, uh, that's a, uh, some price. We're not willing to pay a society. I don't want every employee at my healthcare provider to be able to find out all of my medical conditions, and you don't want it either. while we do want AI to modernize our experience, to improve it, to enhance the service we are getting, we're not willing to compromise the integrity of our data and the privacy and security of our data in the for, for it. and that's where we are coming and saying there shouldn't be a trade off.
It's not one of the, either you can adopt ai, you can modernize, you can move to the cloud, and you can do it while having the best and the right controls around that data.
Logan: And why don't the data systems [01:00:00] themselves. Or the, or the models themselves. In the case of ai, why, why, why can't they solve this problem?
Yotam: So there's two reasons for that. Fundamentally. First of all, you know, security is always an afterthought. first of all wanna do something, then you wanna secure it. So security within the enterprise is used to playing catch up. does something and then we chase them to secure it. Sometimes we have a mature enough processes in place to catch it before it's happening. But with ai, that's definitely going to be the situation. It's already making its way into the enterprise and security teams are trying to play catch up to secure it and to make sure that it doesn't, uh, uh, end up as the enterprise is down for. So that's one fundamental reason that, you know, just hard, it's hard to do all things for all people. The second is that when you look at the enterprise lens of things, they're not using just one data platform or one AI model or one system, right? The enterprise reality is that they have everything. [01:01:00] Uh, you know, uh, a CA friend of mine once told me like he was, uh, doing a deal with Microsoft and he got Microsoft, uh, uh, for most of his environment.
So I tell, ah, so you all set now? He's like, Yotam, I'm not all set. What are you talking about? I have a soup sandwich. You try to pick it up, melts in your hand. We have everything and everything here, that's the reality for every enterprise. So even if the providers give you some tools to do security in their system or their model or whatnot. doesn't solve the enterprise issue of having to deal with hundreds of those models, hundreds of those systems, hundreds of environments. And that's where like Ciera come in and are saying wherever your data resides, whether it's in the cloud, whether it's in data lakes, whether it's on premise, whether it's in systems, we don't even know the name of yet, and we'll come up tomorrow, we are gonna be there to make sure that you're getting a uniform level of security, that you have the right controls, that you have the right access governance, that you can report to your auditors about what [01:02:00] you're doing, that you're reducing risk, managing risk. And the enterprise, that's crucial. it doesn't help them, if they solve the problem in a tiny niche of it, to be able to cover the, the full
Logan: Gap. Um, what's something about. The industry that you believe will be true in a couple years time, that's maybe not commonly appreciated today.
Yotam: I have hope. don't know if I, if I believe that, that hope will will happen, but cybersecurity today is, a market where it's very hard to partner because of the competitive nature, because it's ever evolving. It seems like everybody's competing with everybody all the time. And I think that that has a limit. And I think that, uh, the next wave of, uh, success that is going to come into cyber, obviously AI is going to, to make it a lot more effective, but I think the next wave is going to [01:03:00] come from meaningful partnerships between providers, between vendors, uh, that come to actually serve the, the cause. Uh, I think that when those partnerships start to become more meaningful. That will allow, uh, enterprises to improve their security quite substantially without, uh, increasing the total cost of ownership, uh, that they, they're already invested. I.
Logan: One thing, uh, I'm curious for, for you to share.
Logan: Air, and I know, I know we've talked about this, but, um, October of 23, there's a horrible attack on Israel. And I, I think I told you this. I was like, I texted you guys, uh, and I thought, I thought like maybe s you know, I, everyone was gonna have to go to a war and we have a company in Israel and having to deal with, uh, all of the implications of that stuff, but at, at a human level, I, I just couldn't even imagine the position you guys were in, um, leading through that time.
Can, can you just take [01:04:00] me through like, uh, the emotions of, I, I forget how many people we ended up either on active or reserve as employees. Can you just give a little bit of, uh, background on that?
Yotam: Yeah, so I think, you know, October 7th was, uh, earth shattering. Uh, event for, uh, for the Israeli community and maybe broader than
Logan: Yeah. The
world in some ways? Yeah.
Yotam: And I think for us at say, you know, obviously we are a company with very, very deep roots in Israel. Uh, almost half of our employees, uh, in Israel,
Logan: And you're, you're probably at that time, three years out of service.
Yotam: something like
Logan: Yeah.
Yotam: Um, so I think, you know, on the personal front, I like my first feeling was guilt that I'm not still in the service. Uh, Tamal was always more rational and, uh, smarter, slapped it out of me and told [01:05:00] me it wouldn't have helped shut up.
Logan: Yeah.
Yotam: do what you can, which is to, to continue to succeed, uh, with Ciera. Uh, and I think for the team, you know, not that it's over and like we're still uh, in that and seems like even this week. And things are escalating back. Uh, but for the team, it's, uh, it was an atrocious, atrocious, time. Uh, Israel's a small country. Uh, these things affect people very close to, to home. Uh, it's your cousin, it's your brother, it's your in-laws. Uh, people feel it as if it's like, as if it's their family. And, you know, I now, as we speak, we still have tens and tens of hostages in Gaza. And these are our brothers and sisters that haven't returned home yet. And we, we want them to return as soon as possible, and we want this, uh, this conflict, uh, to be resolved. And so it was [01:06:00] a very, very difficult moment, uh, for all of us. And it's continuing to, to be in our hearts every day. I think as people, uh, living in this day and age. threw us back to our grandparents, uh, days. So, you know, there's something about that, uh, feeling where somebody could come into your home and murder your family. Uh, that as much as Israel has been in conflict during my years as a, as a teenager and as a, as a young man, never felt that before. never felt that feeling that your life is threatened uh, some external power that, you know, has, uh, issues with you, whether they're geopolitical or religious or ideological or whatnot. that, uh, sentiment is, uh, is one that changes people, has changed me
Logan: Mm
Yotam: to, to feel that way, uh, has changed me in a big way. [01:07:00] And, uh, and I think it's changed the Israeli society and it's, uh, led us to, to fight back. Uh, with force and with unity uh, you know, not sure, uh, the people who started that attack expected.
Logan: mm.
Yotam: And I think Israel, all in all, is in a better geopolitical situation today than it was, uh, before that attack, right? Like, uh, this has led us to take a much more proactive stance in protecting our people and protecting our country. But, uh, at the same time, the, the prices, uh, could not be higher uh, the many, many, uh, warriors that, uh, that have fallen, uh, the many, many families that have had, uh, you know, uh, men and women in the service for months and months or even years, over the past two years. And we are all experiencing it very close to home. And I hope that, uh, can find a resolution to [01:08:00] do to this immediate conflict. And, uh, make sure to detail any future, uh, from, uh, from taking action like this again.
Logan: I'm, I'm sure there's really no way to compartmentalize when, uh, so many. People at the business, and probably at that time, half the employee base, maybe, probably more, right? We're in Israel, uh, at the time of, in October of 23.
Logan: Um, I, I'm curious, like as a leader of a company, uh, not that I think people listening hopefully will never have to go through something like that, but, um, how do you, uh, encourage people to keep going about their jobs in some ways when there's this other thing that's so existential and so personal and, uh, I'm just curious, like, how do you try to help people through that to keep going?
Yotam: So I think for [01:09:00] us, you know, it's first of all to to lead with empathy and empathy that is collective, but it's also personal because while it's something that the collective is experiencing, it's also something that everybody is experiencing personally. And, you know, the same thing can affect two different people very differently. You have to respect that, and you have to have the, the room for that. And in general, in Ciera, we have a very, very committed determined and motivated employee base. And that's an assumption, right? Like that's the, that's the, almost like the requirements in order to, to participate in this company. the level of trust with the employees very high. And you have to respect that everybody's going through their own thing. uh, you know, people have a day [01:10:00] when they're not, uh, dialed in and they're not gonna be in the places they need to be. And, you know, to be empathic to that and to respect that, a collective, as a group to, to remind everybody that. This is something that all of us are experiencing and, know, wherever they need to, to do something about it or to be somewhere like we've got their back.
Logan: Hmm.
Yotam: At the same time, our mission a company and as Israelis in the company to, to keep it going and to not slow down. Like we have a unique opportunity to do something extraordinary in the world. We have a unique opportunity to change our industry and to affect the way the world adopts ai. And, you know, we have to, to master our energies and to master our focus and, uh, resources, uh, for that mission as we are capable [01:11:00] of. Right? And it's okay if the capability level drops, that's the situation, but, uh, whatever anybody can do. They should continue to do. And what I've seen in the team is that people actually double down on their walk in many cases, right? Like, uh, you know, the, the world outside was not very fulfilling. Not to say depressing. I think a lot of people in the company found a lot of solace and a lot of comfort the workplace where things were normal a sense. We kept on selling, we kept on building, we kept on moving, we kept on recruiting people. And that was the only place in people's life that was sane. And I think that the team kept each other sane you know, held each other clo clothes in the, the bad days, gave each other space when people needed it, uh, but stayed together, stuck together, and stuck through it. Honestly, when, when this started, I thought that, you know, the, the [01:12:00] throughput from Israel, right? Like, we'll probably stall completely and that wasn't the case. Things, uh, kept going pretty much at the same pace that they were going before,
Logan: Hmm.
Yotam: uh, in some areas even faster. And uh, due to the resilience and determination of the team to, to keep it going. Nobody made them right. Like, uh, you know, tried to give everybody the full support and space to do and be wherever they they need to and people go hard.
Logan: I'm curious about motivations, uh, at this point. You, you guys have had a bunch of success, I'm sure, at different points in time. There were, uh, opportunities, you know, to to, to get off the ride and the people sniffing around trying to buy the business or whatever it is. I'm curious at this point, like, what, what motivates you, keeps you going.
Yotam: I think the first thing, which is sounds so simple, but [01:13:00] I think it's actually the most important one. Is that I'm having a blast, but like, uh, I love my job. I love doing my job. I love the people I work with. what we are doing as a company. Uh, I'm having the best time of my life a very, very big way. And that's sounds so simple, but that's the first of all, the most important thing, right? Uh, you know, there's no, uh, pot of gold at the end of the rainbow, right? Like the, the prize is the journey. Uh, the prize is being able to, to go through this, to build this together with the team, to see people in the company grow, take on more responsibility, solve hard problems, lead other people. You know, that for me is the prize, in all of this, on the personal level. And, uh, and right now it's very, very easy to, to be in love with the company be in love with, uh, with what we're doing. Think on a [01:14:00] personal level. You know, it's a feeling of fulfillment. You're doing something in the world that is world class. doing something in the world that is extraordinary. You challenged yourself as a leader, as a, as a entrepreneur. Every day you have to get better. You have to learn something you didn't know yesterday. You have to challenge the business. You have to challenge the, the team. You have to challenge yourself the time. And that's something that I think, uh, I enjoy very much. And I think Tamal enjoys very much. And it's, it's a really a privilege to be able to, to do this. So there's no rush to, stop
Logan: What's the most challenging, uh, part of the day-to-day right now?
Yotam: of the day to day or, so
Logan: Yeah. Being the CEO of a hyper growth business, I.
Yotam: I think the most challenging part is letting people down. Like, uh, you know, I'm a first born son. First born [01:15:00] grandchild on both sides. like a people pleaser in my, uh, in my nature, in my core. And, uh, when you have 550 people that need things from you or want things from you, you don't get to all of it and like you are letting a lot of people down all the time, uh, in a sense and not to judge yourself for it, to accept it, to keep your head up and focus on the things that you need to focus on. It's, for me, is a, it's a personal challenge to, to keep that, uh, to be able to handle that balance that you cannot be in all places all the time. Today I got on a customer call in Europe uh, a very big enterprise in Europe, and the team was on site in the office with the customers. And you know, you feel that little like bitterness in your stomach.
Why am I not there on the ground like I should have been there on the ground in the office. I would've loved it. They would've loved it, I would've loved being there with the team. [01:16:00] you can't be in all the places
Logan: Hmm.
Yotam: in the way that you want all the time.
Logan: What would you go back and tell yourself five years ago when you're starting Cyera, that you've learned along the way?
Yotam: Go faster.
Logan: Do you think you didn't go fast enough in the early days, or you just could have gone faster?
Yotam: It's hard to say you didn't go fast enough, but in hindsight you could have gone faster.
Logan: Is there something you've, you've learned, uh, operationally that you feel is critical to, um, if you were to run it back? Like if you were to start another business at some point in the future, you're like, uh, make sure to not make that mistake again.
Yotam: Wow. So many, so many
Logan: Yeah.
Yotam: Yeah. But, uh, maybe I'll give something that is. You know, not so trivial, but, uh, but still quite applicable. As the business becomes more complex, it becomes more of it, more things are happening, different things are happening, more people are doing things. It becomes a little hard to, [01:17:00] to understand what's going on and to to own it in a sense. And there's a concept in, uh, in software that is a very basic concept, but sometimes it doesn't get implemented all the way through in, uh, business. That's, uh, the concept of an interface. How do, how do you interface with the world? And something that I've recently realized that some business units, some business functions have a very clear interface everybody knows how to interface with them some don't. And they need to declare an interface. They need to say, this is how you interface with us. This is how we, uh, accept requests. This is how we work on
Logan: These are departments or peoples or people? Yeah.
Yotam: the company. And, you know, some departments like just have a very natural interface. For example, sales are measured on a quarterly basis on the numbers they put up on the pipeline they have for the next quarter, right?
Like it's relatively, [01:18:00] the, the basic level of interface is much more, clear than for some other departments. They don't necessarily have a clear cadence or don't necessarily have a clear timeline for the things that they're, they're doing or not doing. And you know, they have to somehow teach the organization how to work with them. And they don't always do that proactively. I think oftentimes that creates frustration. The people are working hard, but nobody knows what they're working on and what they're not working on, and you know, what they chose to prioritize and what they chose to not prioritize. And that's just a lack of an interface, not, uh, not such a hard problem to solve once you define it.
Well,
Logan: Are there things that you do or tactics you've employed that enable you to maintain this perpetual motion and this ability to go fast?
Yotam: first of all, I hope it's perpetual, right?
Logan: That seems like it so far. Yeah.
Yotam: it's a good
Logan: Yeah.
Yotam: uh, but let's hope it's perpetual. I [01:19:00] think the you know, we're in the software business. We are building enterprise software today for cybersecurity buyers, and not the easiest thing, but it's also not rocket science. The customers know their problems. They know what they don't like about their existing solutions. They know. What they can spend on problems, right? So the work with the customers is the, the, the foundational driver for a lot of the innovation and growth and continued growth for the company. Keep talking to the customers, keep listening to what they're telling you about their needs, how their needs are evolving and changing, where they see you, where they want you, and what are the gaps you need to close. So, you know, once you actually get in, in the enterprise, it's a lot about being able to listen and execute, right? If you execute for the enterprise, they have many more problems they want you to solve.
Logan: Hmm.
Yotam: [01:20:00] Uh, you just need to, to be able to define those problems well, based on, uh, the right sample size. You need to be able to, uh, plan great solutions for that.
Uh, for, for those problems, you need to make sure that the additive value of getting that solution from you, plus one equals three, continues to exist.
Logan: You have a number of venerable investors around the table. We've referenced some of them. I'm curious, uh, uh, especially coming after off of a very high profile acquisition for, uh, for, for Sequoia. I'm curious, working with Doug now for four years. Three, three years, what, um, what's something he's imparted to you as a board member that, uh, that you feel has been particularly helpful or additive to the, uh, to the organization?
Yotam: You know, it's, it's a little embarrassing to say, but I think the biggest, uh, biggest gift that Doug gave me is validation [01:21:00] for my leadership for Tamar's leadership. Right. And it wasn't given when he invested, but, uh, about a year and a half after you invested, just about the time
Logan: Yeah.
Yotam: invested, uh, started telling us nice things about us and, uh, you know. There's something about the way Doug handles himself in the world makes you believe it when he says it, whether many other people might tell you nice things and you'll just discard them to the side. I think that that was, that validation was empowering for us and allowed us to, to believe in ourselves and to, to dream bigger and think bigger.
Logan: Uh, I guess as we sort of, um, think about wrapping here, uh, fundraising, I think you're a, I would call you a good fundraiser. I don't know if you would consider yourself a good fundraiser, but I think, uh, the same characteristics that you do a great job of, I. Um, selling customers on the opportunity of SI think you also bring that to bear with the venture community.
What have you learned about [01:22:00] fundraising, picking partners, investors? I.
Yotam: And it matters a lot. I think, uh, you know, it's very easy to, to look at the valuation because it's numbers. Uh, so it's easy to compare, uh, what the offer for X is, what the offer from Y is, it's numbers, it's objective, it's easy to, to say, uh, what you prefer. But, uh, investors in venture capital and our space, and our stage and our world, uh, it's like getting married. And I think for many reasons, you don't actually know, uh, the partner as as much as you, you think you get married. And, uh, you know, taking the time to get to know each other a bit, to make sure that there's alignment of values, of beliefs, alignment of expectations, uh, the way we communicate in the [01:23:00] way we work together and what we're trying to achieve is, is important, Uh, you know, the fact that. firms are a venture capital firm, doesn't mean they're the same. there's big differences in how they approach it, how they approach the business and what they want from a company, when they're making that investment. that it's, uh, it's really important to, to look at it more like a decision about somebody who bringing into the family uh, uh, you know, strictly financial, uh, decision.
Logan: I feel like you did a good job of, um, you've gotten a lot of like core people to organizations involved too. I don't know if that's something that you were purposeful about, but Philippe at Xcel and, and Doug at Sequoia and you know, on down the line at Dave and Lucas at CO two, obviously Gillian Lior at.
At Cyber Starts, you've sort of gotten the [01:24:00] core people involved in it. Um, I guess there's something there too as well of like the stability. All those people are very stable in their organizations, I would say. And I don't know if that's something you intentionally did or thought about, but having people that are stable at the partner level within their firms, I assume has been pretty helpful as well.
Yotam: Yeah, I mean, you know, for us, working with, uh, reputable, firms you know, many senses, venture capital I. Have a lot of power over the company. in, in my aspect, like in my perspective, what holds that power in check reputation. Yeah. Right? Like the, the reputation is important because it's, it's the defense mechanism in the sense that the, the founders have And great investors care only about one thing more than they care about the company's outcome. It's about the reputation. Yeah. [01:25:00] Because they plan to invest small and build more companies, and reputation lasts a lifetime. So, you know, having people who value the reputation is, uh, critical.
Logan: There's a funny thing too, where initially companies steal the brand from the venture capital firm, and then ultimately if you're successful, the venture capital firm steals the brand from the company, right? It's like initially you put our logo up on the website, uh, our, you know, general our, uh, up on the website and show it off, and then at some point it shifts and we put your, you, you're up there and you get the tombstones when you come in and we show your picture.
And so there's this funny brand stealing thing that exists too, that is validating, right?
Yotam: as you know, it goes much, much further than that. Right. At the end of the day, you know, VCs rely on their founders in order to help them get
Logan: Yes.
Yotam: deals. So the relationship is definitely much more of a two-way, uh, by directional [01:26:00] relationship than it is, uh, initially portrayed.
Logan: Yes, that's right. That's right. Yeah. Especially as you're successful people, uh, wanna call in favors from you.
Logan: I guess, um, if you're listening and interested in Ciera and, uh, either I guess as a customer, but probably more likely as an employee, um, where can they find you? What are you hiring for? What traits?
Uh, we talked about some of the cultural traits, but what, what type of person, uh, are you looking to bring on board?
Yotam: Smart, and hungry. That's the, the, the people that we are looking for. And, you know, to, to be very frank, as I tell all the employees in their interview process and on the welcome to say, call, have anything against work life balance, it's just not what we offer, right? Like, this is a very, very intense workplace. It's not intense because somebody makes you work hard. It's intense because it's gonna swallow you in and you, you're gonna find yourself, uh, thinking about it in your, uh, in your dreams and in your [01:27:00] vacations. And it's just that kind of place. It's contagious. And, uh, and you know, people, uh, who love it, love it, and people who don't, don't. I think, uh, you know, it's important to know what you have to offer. We have to offer. Extremely thrilling, exciting, and distinguished ride. We have to offer a drive for excellence that is, uh, uncompromising, we don't have to offer is a great work-life balance that sadly, uh, you know, to my wife's dismay, that's sadly not part of the, the core value proposition that we have for employees today. And it's important to, to know that,
Logan: Yeah, there's other places you could find that go. You can go work at 'em
places.
Yotam: that. And like, again, and, you know, people have, today have pretty long careers. There's times to do different things in your career and there's times you want to go all in and there's times you want something more balanced and that's, that's akay and it's, uh, you know, hope I'm not [01:28:00] gonna work this hard forever, but, uh, but right now I'm enjoying every minute of it and I wanna walk even more.
Logan: Yeah. You won't be around forever if you keep working, uh, as hard as you do. Uh, and, and, uh, hiring across all different functions, all different, how many people you have to hire this year.
Yotam: 500 people.
Logan: Yeah. So yeah, so a hundred to 2 50, 2 50 to 5 50, 5 50 to whatever that is, 1100 or so. Yeah. It's, uh, so there's lots of job opportunities out there if people are, uh, smart, hungry, and humble. Well thank you for doing this. This was fun.
Yotam: Thank you, Logan, for the pleasure.