If you are reachable, you’re breachable: Zscaler’s Jay Chaudhry

On the sidelines of Zenith Reside ’26 in Vienna, sitting throughout from Zscaler’s founder, CEO, and Chairman Jay Chaudhry, it’s straightforward to be reminded of a scene from Unstoppable. In it, welder Ned Oldham, when requested how he felt whereas he was bringing a runaway practice underneath management, famously shrugs off the dangerous, high-speed chase as simply being in his ‘consolation zone’.

Zscaler shares are down by over 50 per cent prior to now yr, caught within the SaaSpocalypse, however Chaudhry seems to be in his consolation zone. In contrast to different SaaS CXOs who’ve gone on the defensive about their merchandise’ relevance as AI upends the software program business, Chaudhry had been on the offensive simply the day before today, declaring in his convention keynote handle: “Zscaler was made for this second.”

For individuals who have adopted his work intently, this may increasingly not come as a shock. Final yr, requested by this paper what he needed to inform younger entrepreneurs in India, he had replied: “Deal with an issue as a problem. Human beings do exceptionally effectively once they have a look at an issue as a problem.” He went on so as to add, “Don’t be drawn to cash. If we (he and his spouse) had been drawn to cash, we wouldn’t have taken the dangers.” The Nasdaq-listed international cybersecurity firm, with $24-billion market cap, is the fifth of his ventures, after founding and promoting 4 different profitable tech startups prior to now a long time within the US. Born to farmers with restricted means in Himachal Pradesh, he made it to a US college in 1980 on a scholarship and windfall. He had virtually deserted his US dream as he couldn’t afford the flight tickets, when destiny related him to JRD Tata and a mortgage for his journey.

Seizing the ‘second’

To elucidate why Zscaler was ‘made for this second’ he rewinds to the origins of the corporate. Again in 2007 he was trying to do one thing ‘huge’ after 4 profitable exits. The world was getting extra cellular — SaaS, AWS, iPhone… With functions abounding, and customers all over the place, he sensed the necessity for a paradigm shift within the strategy to cybersecurity, laying the foundations for Zscaler.

Zscaler works on a ‘zero-trust’ precept — deal with each consumer and utility as a possible risk till verified as secure. In a world the place customers must entry any utility, anyplace, on any system and on any community, he’s of the view that the firewall-based methods will not be efficient. If the firewall is breached, unhealthy actors can do what they need. Verification of each entry and restricted entry make for a greater strategy, he says.

Zscaler was a pioneer in turning the zero-trust idea right into a subscription cloud service that permits prospects to cover their apps from hackers. “In case you are reachable, you’re breachable,” he says.

He explains how, at the same time as CEO, he has not been accorded the ‘proper’ to make modifications to the ERP system or the corporate’s public cloud. By limiting the entry to functions and significant infrastructure to a small group within the digital world, one improves the safety, he says. By executing a “by no means belief, at all times confirm” protocol for each interplay, ‘zero belief’ isolates the consumer from the community. This ensures that even when hackers hijack a tool, they’re trapped in a lifeless finish, with no technique to see or infect the remainder of the corporate.

He factors out that with Mythos-like fashions, increasingly more safety vulnerabilities will probably be found going ahead. “Software program at all times has vulnerabilities. As a part of Anthropic’s Glasswing venture, now we have been busy discovering and fixing vulnerabilities in our software program infrastructure.”

Additional, with agentic AIs set to outnumber staff in lots of enterprises down the years, he believes the function of zero-trust and Zscaler has assumed much more significance in an AI world. Moreover making it simpler for hackers to determine vulnerabilities, the fast development in agentic AI utilization additionally means the dangers are higher when it will get compromised and stays within the company community — “yesterday, customers had been the weakest hyperlink; at present brokers are the weakest hyperlink with regards to safety”.

Disconnect with traders

Given his lengthy stint within the tech ecosystem, what’s his tackle the SaaSpocalypse? Chaudhry argues for differentiation: “A bit of Claude code can’t write what SAP has finished for ERP methods; these are very advanced, whereas a easy fundamental accounting system for a mom-and-pop retailer might be changed. The best issues to disrupt are analytics and reporting.”

Advanced methods require a greater understanding, technical experience and course of. Zscaler as a world infrastructure firm with a presence in round 160 places and a seamless community connectivity has sturdy moats, he says.

Mission-critical functions want 100 per cent certainty, he argues.

His 35 per cent stake in Zscaler (held straight and not directly by trusts) provides him the leeway to behave as per his conviction, not like different SaaS founder-CEOs. Such a excessive stage of possession is uncommon in US tech corporations after a number of rounds of pre-IPO funding result in possession dilution. Zscaler was largely bootstrapped and its efficiency stays sturdy. The corporate is anticipated to shut FY26 (ending July) with income of $3.3 billion and 25 per cent development versus 23 per cent a yr in the past. Revenue can also be scaling up considerably with EBITDA margin leaping to 26.8 per cent from 2.3 per cent in FY25.

Right here we see a paradox — as profitability scales up considerably, traders are panicking. Wall Avenue’s Rule of 40 (income development% + free money circulate margin% or EBITA margin% have to be above 40 for a beneficial view) is broadly used. On this metric for SaaS companies that concentrate on development over profitability, Zscaler ranks fairly effectively at round 50 for FY26. The inventory trades at one year-forward EV/income and EV/FCF a number of of 4.9 and 20 instances, respectively (based mostly on Bloomberg consensus estimates) — its least expensive since going public in 2018.

On the time of the IPO, Zscaler was processing 30 billion transactions a day; at present that rely is over 750 billion — a 25 instances enhance (47 per cent CAGR). Income development has saved tempo at a scorching 43 per cent CAGR. If transaction development stays sturdy, as Chaudhry expects with the rise of agentic AIs, Zscaler traders could have much less to fret in contrast with different SaaS corporations.

On India, Zscaler’s fifth largest market, Chaudhry says some personal Indian banks are savvier than some western banks with regards to cyber threats, however not so within the case of smaller companies. He has an total message: Given the AI risk, all organisations must buck up.

Lastly, what would it not take to make India a pacesetter within the AI race? “India ought to assume exterior the field and ask itself what it could do to get its younger individuals prepared for the world of AI.’’ It ought to includeAI in curricula at numerous ranges and “have a look at methods to inspire children”.

“Books on motivation, optimistic considering, working onerous and success tales performed a giant function in my success,” he indicators off.

(The author was in Vienna on the invitation of Zscaler)

Revealed on July 4, 2026