Security, Bit9, and Business ModelsAug 8
The persistent and recent security hacks reported in the media remind me that we are unsafe. In spite of many dollars and much effort, the arms race against black-hat initiatives continues.
Security is a sector that continues to intrigue me. At my previous firm, I was a founding investor in Bit9, which recently announced a major financing, which Sequoia led. CEO Patrick Morley is a rock star.
Yet, the sector also concerns me. Few start-ups will hit Bit9′s inflection point. Few companies can recruit a Patrick Morley, who knows when to up the burn and when to hold off.
Many security start-ups have capital-intensive business models involving many expensive field sales people. Get it right, and you’re golden. Get it wrong, and you’re sucking down a lot of capital quickly. You get it half-right, and you still need a lot of VC money, which means the start-up’s founders may not make much money in an exit.
Would love to hear from folks about next-gen business models for security.