Gil Shwed: Cybersecurity market disconnected from reality

Shwed started by assessing whether or not there’s a bubble in tech shares. “We have to separate the capital market from the true world,” he mentioned. “AI is a revolution, not a bubble, however are there any shares available in the market which are overvalued? It may very effectively be. The prospect that the revolution will change the world is excessive, however on the identical time the prospect that there are shares which are overvalued on Nasdaq can be excessive. In 2001, there was a bubble following the Web revolution, however 20 years later the Web remains to be alive and kicking and can create extra revolutions. The revolution occurred, however the market was shaken.

“AI will probably be a power in the whole lot we do, and particularly in cybersecurity. A couple of years in the past, they predicted that there could be a scarcity of cybersecurity specialists who function the programs, however maybe AI will shut this hole, and people will return to overseeing the programs. Then again, it may create an assault on all of our infrastructure. It used to take weeks or months, however right now it’s occurring at a loopy tempo. We have to defend the info we share with AI, and communication between brokers will also be a gap for cybersecurity vulnerabilities. I imagine that simply as there have been risks on the Web, which have additionally materialized, however the world remains to be safer than it was 40 years in the past, so too is cybersecurity.”

A deal valued at $300 million

To adapt its operations to rising challenges, Examine Level purchased Swiss firm Lakera, which protects AI brokers, for $300 million. “We have been searching for corporations that would assist us within the area of AI, to strengthen our nice product. We checked out a number of corporations, together with Israeli ones, that have been glorious and we wished to accumulate them, however not all of them wished to be offered, or wished offers at the next worth. In the long run, we got here to the Swiss firm and we’re comfortable. It seems that there’s a depth of know-how there that we have not encountered in years. The corporate has an impartial mannequin and makes certain that the communication between the brokers is sweet.”

Shwed’s skepticism on the pricing of know-how shares issues the cybersecurity area. “I sound like a damaged report, however the query is whether or not we handle to promote to prospects and create worth for them and subsequently revenue from the income. Right this moment the market is disconnected, as a result of it’s measured by whether or not corporations handle to lift cash, not whether or not they create worth for purchasers and translate it into revenue. The non-public market is constructed on the truth that there are giant corporations that purchase small ones and handle to deal with their issues. Wiz is a large phenomenon, however they didn’t remedy the issue of making worth, however reasonably transferred it to Google.”

As for competitors from the tech giants, which have just lately taken on important cybersecurity actions, Shwed mentioned, “There’s a livelihood for all and you may see it with cybersecurity corporations. The competitors in our market is main and I’d not underestimate it, however at Examine Level we’re proving that it’s attainable to generate a number of many years of buyer worth, income and earnings, and after that returns for shareholders. So it’s undoubtedly attainable to succeed at this.”

Shwed spoke about being the corporate’s largest shareholder, even after promoting somewhat over one million Examine Level shares final quarter, for about $205 million. “I hope to stay the largest shareholder. So far, I’ve primarily exercised choices, in anticipation of their expiration. Thus far, ready for the end line earlier than exercising them has confirmed itself to be a profitable coverage. I could promote shares, however that’s actually not my technique or coverage.”

As for the query of whether or not he’s comfortable along with his new standing, a yr after taking a step again from managing the corporate, which he left within the palms of Nadav Zafrir. “I’ve not been CEO for a yr. I rise up within the morning and another person has to unravel the issues and I actually get pleasure from it. It is one thing totally different to assist somebody within the CEO function, and to my delight, Nadav Zafrir does an awesome job. I discover that working in a a lot much less intensive means is enjoyable. Within the meantime, I actually get pleasure from it that I do not work 12 hours a day.”

Full disclosure: The convention was held in cooperation with Financial institution Hapoalim and Phoenix Group and sponsored by, Bezeq, El Al, Tnuva, Electra, Armis, Haifa Group, Hamilton Lane Israel, Doral, Shikun & Binui, BlackRock, Bazan, Pagaya, KPMG, Nespresso, Egged, Zeekr, ICL and the Israel Medical Affiliation, and with the participation of Israel Ports. Co., Mekorot, Ashdod Port, and the Israel Innovation Authority.

Printed by Globes, Israel enterprise information – en.globes.co.il – on November 23, 2025.

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