Black Hat USA 2024 | Michael DeCesare | Abnormal Security

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Michael DeCesare

President

Abnormal Security

play_circle_outline AI changing cybersecurity industry dynamics, emphasizing need for automation

play_circle_outline Focus on automating manual analyst tasks using AI, expanding beyond email security

play_circle_outline Expansion into other SaaS applications beyond email security

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Michael DeCesare | Abnormal Security

Michael DeCesare

President Abnormal Security

TheCUBE's coverage at BlackHat on day two features John Furrier hosting. Michael DeCesare, president of Abnormal Security, discusses the success of the company's product in the cybersecurity market. With the rise of AI in security, the need for advanced protection against targeted email attacks is crucial. Abnormal Security focuses on email security using AI technology to detect and prevent malicious activities. Their success lies in the automation of processes, better detection rates, and high ROI for customers. The company was founded in 2018 and has experi... Read more

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Michael DeCesare | Abnormal Security

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>> Welcome back everyone to theCUBE's coverage here at BlackHat. This is day two of wall-to-wall coverage. I'm John Furrier, host of theCUBE. We have CUBE alumni returning, Michael DeCesare, who's the president of Abnormal Security. Great to have you back. Thanks for coming on.

Michael DeCesare

>> I appreciate you having me.

>> So you guys have got the big funding news we covered on SiliconANGLE yesterday, 250 million, big valuation, but the product success has been the big driver. So I want you to tell us why you guys are so successful. Obviously, security conference here at BlackHat, AIs upon us. Abnormal's been doing some really great things.

Michael DeCesare

>> Yeah, well, first it starts with behind every great cybersecurity company is a great product, and we have one of the best products in the marketplace. So it helps when your technology works as advertised. But there's been a big shift the same way that folks like you and me are learning to use ChatGPT for different aspects of our life. The bad actors are also learning to use ChatGPT. And it's easier than ever now for a low level attacker to be able to use ChatGPT to emulate an email that gets somebody in a company to click on. And because of that, we've seen a pretty massive spike in the bad actors coming into companies through targeted email attacks. And that's the first use case we have. We're an AI company more than we are an email company, but email security is the first use case we started with.

>> You've been on theCUBE before many times. You've seen the security waves. I mean, talk about the scope of the inflection point that you're seeing now given the role of data, given what generative AI is enabling. This is a huge moment in the industry. What's your perspective on this? Obviously, there's like 13 categories in InfoSec these days. I mean there's so much silos, seems like it'll be a new era is upon us in the security industry. What's your view of that?

Michael DeCesare

>> I think that when the cloud came out 10, 15 years ago, it was something new. Not every company in cybersecurity was able to make it through the transition from on-prem to the cloud. We're seeing a similar dynamic going on across cyber right now, which is AI changes everything, and not everybody is going to be able to keep up with how to use AI for positive within your own product. But the biggest change that I've seen overall in the cyber industry is for 20 plus years, this industry has been an industry of checks and balances, right? You don't let CrowdStrike just block things. You have an army of people that sit in a security operations center or a SOC looking at the output of CrowdStrike and Palo Alto and Zscaler and all these great products that are here at this conference and then making a human manual judgment about what things are bad and should be acted on, what things are good and should be let go. And then fortunately, now with the AI finding their way into the bad actors, it's the speed of the attack that is changing, like the ability for a bad actor to leverage ChatGPT or generative AI to get into a company, get someone to click on something, bridge over to whatever the asset was they were trying to steal and get out as being measured in minutes, not hours now. I think what it's going to force this industry to do is move towards automation, that the days of a human being working on a console and being able to approve things are gone. Companies are going to have to evolve quickly if they're going to keep up with that.

>> Talk about what you guys focus on because before you came on camera, you were laying out the market categories, where the spend is. You guys have a really specific focus. And the reason why your success is you're just hyper-focused on a specific best-of-breed use case. Share where you guys sit in the market and what you're targeting.

Michael DeCesare

>> Our aspirations long term are very aggressive. We see an opportunity to use AI, cyber AI, in a way to automate what a lot of manual analysts at companies are doing today. So our objective long term is far larger than email security. But when we looked at the cybersecurity stack when we started the company in 2018, the biggest category of spend that had not gone through a next generation approach was email security. Ironically, the same architecture of a appliance that sits on-prem in front of your email system filtering inbound emails, it's the same architecture used by the incumbents today as it was 20 years ago. And now that customers have moved their email from on-prem to the Cloud 365 or Gmail, there's another way that you can protect email security, and it's what we do. We only work with the part of the market that has moved to the cloud. It's about 85 or 90% of the email market. And we plug in through the APIs of the email system, so we sit in a different place. The traditional email security is filtering inbound emails only and comparing that against bad attachments, bad URLs, things that you wouldn't want in your environment. And honestly, attackers every day are figuring out how to get past those controls quite easily. We build the behavioral baseline of every email box in a company. So we understand when you email, who you email, what groups you're a part of, the way you write emails, that all of those inputs allow us to be far more granular. We see inbound email, we see outbound email, we see intercompany email. We can plug into things like Slack, Teams, Zooms. All of these allow us to build this behavioral baseline that allows us to be much more granular in determining whether it's actually you at the keyboard or whether somebody has taken .

>> How long has this company been around? When was it founded?

Michael DeCesare

>> Company we founded in 2018, which has crossed 200 million of revenue. We announced that yesterday, been Herculean growth. We have a 99 point something percent rating from Gartner, recommendation rating that the product is really strong.

>> Just hold on to the rocket ship, don't fall off. That's the secret to success. I like the vision. So your core competency in the way you guys see it is automation really leveraging AI and email's the starting point. Sounds like that's the strategy. Come in, grab the email beachhead and-

Michael DeCesare

>> We're at an inflection point as a society. As I was saying earlier, for 20 years, when people put email security in place, there was always this fear of like, "Don't block our CEO's emails." We're quickly getting to a point where no email is going to be allowed to come into a company if it's not deemed to be safe by a product like us. Because there's too many examples of things that look identical to the real approval that people are clicking on that are actually malware. So our first use case is email that allows us to build a behavioral baseline of every human being. Where we see ourselves expanding is into every other application that is SaaS in environment. Earlier this year at RSA, we announced integrations into products like salesforce.com and ServiceNow and Workday. All of those are allowing us to build a stronger behavioral baseline that allows us to be much more granular.

>> And I think that TAM is going to be there for you, and it's evolving. We are seeing, we just did a super cloud event around the data platforms, these open table formats, governance is changing. And then ultimately intelligent applications are going to be generate AI-based. And I think that's going to be waiting for you guys. I think it's going to take out a little bit. But I want to get back to the point you mentioned around AI because I think what's interesting about email and generative AI and deepfakes, there are really good ways to get in through email for hackers. I mean, it's just used to be easy to spot an email, broken English. You can see that's not an email. But now emails can be written with AI from the bad guys, Six.One link to get phished.

Michael DeCesare

>> They're getting much better already. I mean I don't think anybody in the world has... I think everybody's experienced it, right? You've seen something that looks like it came from your bank, but then if you click on the sender, it's not exactly your bank's name and that's what tells you that it's fraudulent. Just recognize we're getting to a point where those attacks are going to come from an actual employee at the bank that you bank with. So there's nothing you're going to be able to tell about that email that makes it look fraudulent. The bad actor will come into the bank, take over somebody's email and then send you as a customer of the bank things. It's a very difficult environment to predict how we're going to defend against and that's why we think our products .

>> Michael, one of the things that CISOs know about this, I mean not like it's not on their radar, obviously your success and growth and numbers are awesome, obviously it's working, what's the secret sauce? I mean, obviously they know this email's a problem. It sounds like you guys hit a home run here with the solution. What's the key to success on why the adoption with customers are so high right now?

Michael DeCesare

>> A couple of critical reasons. First, we have at least 10 times better detection than any of the historical gateways. Our product has so much more data that it's analyzing than the historical gateways that allows us to have detection. False positives and negatives are really best of class compared to most companies. It's full automation. So with the historical products that are out there, it's not uncommon for big companies to have a dozen people managing their email security. With us, it goes to almost zero because we're not asking a person to look at something and make a decision. We're just using our dashboard to show the person the blocks and things we've already made. So I don't know a CISO out there that isn't trying to do more with less. We are one of the best ROI products. We install in less than a minute. We require almost no professional services to get the product live. And honestly, everybody in the world has dealt with phishing. I've been at Abnormal for about a year. I don't think I've gotten 10 emails in my inbox collectively in a year. The product just really shows the value right away.

>> Yeah, awesome.

Michael DeCesare

>> I think CISOs are always looking. There's not always a tight correlation at these conferences between the messages companies are playing out there and how the product actually works. We are the opposite. We have an incredibly tight correlation. What we're saying is exactly the way the product works.

>> It's a dream scenario on the go-to-market. Just installs easily, instant value, product excellence, product leadership. I mean, really good kind of tailwind there, hence the 200 million ARR you guys are doing.

Michael DeCesare

>> It's a fun company to be a part of. And it's fun to come to these conferences when your customers are hugging you and not trying to smack you in the side of the head for what you've done to them. We're just continuing to try to execute as a company and getting ourselves ready to eventually be in the public markets.

>> What's the margin? Most of you guys must have great operating leverage. Not a lot of customer support, not a lot of professional services. What's the scale plan? What's your plan for building out the organization? Where are you guys at? Can you give us an update on what your plan is, where you are, and what your plans are for next year?

Michael DeCesare

>> So like the press release said, in five short years we've eclipsed 200 million of revenues or our growth is well over 100% top line. We've also built a very efficient product. The cost of goods sold or gross margins on the product are super healthy, even for our size. It's part of the reason that we see the public market as a place we eventually want to be, is we'll compare very favorably. Our financials are super strong from that perspective. What we're up to now is we got to build out markets. Some of the money that we raised in this round, what we just did is going to go into international expansion. We have customers in 36 countries today, but we don't always have sales people and support people and professional service resources. So there's a lot of hiring going on across the company into those marketplaces. We're also building new products. In addition to email security, we branched out into almost all other major, what we call everyday apps, the apps that customers use in their environments every day. And again, there's such almost an Apple-esque love for the product by our customers. And we're quite confident as we continue to produce more things that our customers will have a willingness to adopt those. And we see expansion opportunities in both those categories.

>> Being a secure AI layer where infusing AI safely is a huge concern, everyone wants that in their apps.

Michael DeCesare

>> Some products adopt AI very well and other products will have to be re-engineered from the ground up to make use of AI. But AI is not a future. It's here today and it's in both the good and the bad side of this. I think it's on vendors like us at this industry that are in this conference that it's on us to figure out how to stay one step ahead of the bad guys.

>> Well Michael, great to see you. Congratulations on your success.

Michael DeCesare

>> Appreciate the time.

>> Thanks for coming by. busy. Have a good show.

Michael DeCesare

>> We appreciate the time.

>> All right.

Michael DeCesare

>> Thanks for having us.

>> All right. This is theCUBE day two coverage. I'm John Furrier with theCUBE. We'll be right back after the short break.