Steve “Woz” Wozniak, infamous co-founder of Apple, was the latest culprit to send shivers across the tech world by claiming Cybersecurity is the greatest threat the world has faced since the atom bomb. Mr Wozniak was alluding to the heightened sense of fear that recent high profile breaches have caused Cybersecurity to be put at the forefront of political, corporate and now it would appear, investor agendas. As the topic gains increasing awareness, it gives rise to a number of companies claiming to be a “thought leader” in the Cybersecurity space, holding the best IP and the best routes to market. With many companies singing from the same loss making hymn sheet it is making it ever difficult to spot the true “Spartacus” from the crowd.
Cybersecurity is nothing new. However, the cost of getting it wrong has risen in prominence with the immeasurable combined threat of financial, regulatory and reputational risk concerning many CEOs. In 2015, TalkTalk was the UK’s prominent cyber-attack case when 150,00 customer details were taken in October 2015, costing the company c£60m and losing 95m customers. An organisation doesn’t need to be “attacked” to feel the burn. The UK government recently revealed that it spent £860m from 2011-2016 on a cyber security programme with a prominent GCHQ (Government Communications Headquarters) Director, Alex Dewdney admitting the money spent “hasn’t worked” and the problem was “not so much a money issue as it is a human resources issues”.
Off the back of any corporate scandal comes a raft of companies positioning themselves to help solve the crisis and this is particularly true when it comes to cybersecurity. Dell was quick to capitalise on the hysteria, in April spinning out its cybersecurity arm, SecureWorks ending the tech IPO drought in the US. With a valuation of over $1bn and losses of c$72m it’s clear they were in the right place at the right time. US cyber security peers such as FireEye, Barracuda Networks and Rapid7 all providing a raft of share price performances this year making it difficult for investors to spot any continuity in the sector.
As the world becomes more digitally connected through the Internet of Things it brings increased opportunities for security breaches. Mobile devices are increasingly becoming connected to cars, homes, even power stations. With such widespread embedded data sharing cyber-attacks are no longer a private “device on device” incident but a situation where one breach could access an unlimited amount of personal data stored across various connected sources.
Cyber security is a highly intelligent threat and continually adapting to the latest line of defence technology. Because of this, companies need to strive for continuous innovation with an expansive and developing patent portfolio. The static “one trick pony” patent portfolio company will surely fall by the way side.