Photo: PHOTOSET
The Israeli startup company Kaito Networks operates in a market dominated by old communication providers such as AT&T and Verizon, and security giants such as Cisco, VMware and Palo Alto. To date, customers have purchased a variety of devices and services from them and put together the protection shell for the network, but due to most technologies, no one could manage them effectively. Kaito packs everything into one product, transforms all the old solutions, and makes them easy and simple to manage and use. That is, Kaito provides both the communication infrastructure and the security envelope through one cloud service. The company was founded by Shlomo Kramer (one of the founders of Check Point and Imperva) and Gur Shatz (Incapsula). Kramer serves as CEO and Schatz is the President and Chief Operating Officer. Shatz was the first employee at Imperva, and later was one of the founders of the cyber company Incapusla, which was later sold to Imperva.
We start the conversation by trying to understand the beginning of the path and the idea behind the giant Kaito. In the last 25 years, many companies have emerged in the world, each of which offers a different solution. So many companies, that the integration between them all became impossible. “We said that there can’t be so many tools that IT people need to work. The way to solve it is simply to build one network in the cloud, a fortified network of the organization, which will do all the things that all the networking and security companies have done until today” he says Schatz adds: “We are a cyber company whose goal is not to use all kinds of things but to replace many of the solutions and make them simpler.”
When we move on to talk about his professional history, Schatz says that “Kaito sometimes seems to me like the final stop of all kinds of things that have happened to me over the years” and explains that “in the last 20 years I have worked in a total of 3 companies”. Shatz was the first employee at Imperva, and later was one of the founders of the cyber company Incapusla, which was later sold to Imperva. “Keito Sog-Shel was founded out of this exit and out of the understanding we came to, that all these things can be solved in a way that was not possible before – you can set up websites all over the world, the Internet is completely private and is built on companies’ data centers. The world has changed very, very much, and therefore it is possible To remove the problem that has existed for many years and could not be solved before – the problem that the network is something very messed up and problematic and distributed; and if you want to connect one place to another around the world you have to use service providers – all these problems can all be solved by one thing.” He obviously means the network that Keito built.
Cato Networks has so far raised 532 million dollars from international capital funds, at a valuation of 2.5 billion dollars. Today it has over 1,300 enterprise customers.
Let’s close a circle for a moment regarding the cloud?
“Imperva of the time (2002) worked beforehand with Salesforce, and it was strange to think that all the company’s sensitive information was sitting in some cloud, but it worked well and grew together with the company,” Shatz replies, “In 2009 I got to fly between San Francisco via London and Israel , and I had many hours waiting at Heathrow. I happened to meet Miki Buday, who was doing something more cloudy at the time, and that’s how I say to him, listen, the last time I saw a real attack – it was a long time ago. And he connects from his computer to the production system and he starts to see Things that happen at that moment.” He says that this is the moment the token fell – it is impossible to secure information on-premise. “This basic idea of taking all the wisdom and transferring it like this to the cloud, so that you can see with your own eyes what is happening from one side and react quickly was amazing.”
“I don’t think we’ll see a quick return to the bubble world anytime soon”
In the end, to secure a network like yours, you need a very comprehensive solution. How do you build a company with a product that is thin enough to release to the market and receive feedback, but very broad on the other hand to provide a holistic solution?
“Even before we talked about the MVP, it was clear to us that this thing that I think a young entrepreneur who starts a new cyber company has – there is an ability in the cloud to reduce gaps very quickly, and if in advance you build the product so that it is built on the cloud, you can produce a product and a solution that is much More complete and faster than a company that manufactures a cycle. It sounds simple in retrospect, 8 years later, but we took a lot of flak for the concept when we said we would build in advance the ability to record everything we see, and develop the company and the product at a much faster pace.”
In the beginning, the founders financed the company themselves and raised a very flat organization, with an emphasis on concentrated work and not on meetings. “It was like going against all the instincts of a startup company building an MVP, and going for a product that from the beginning would be big, the presentation we brought to the investors after a year showed all the things that are still there today, it hasn’t changed fundamentally. I can’t recommend it to anyone to do, unless it is a company that arose from insights that came before”
We see this a lot in Israel – whole teams who understand what the next holistic solution is, and leave to start a company and raise money.
“Society must rise from a true understanding of need or what I call ‘crap’ – there is some kind of piece of poop in the world that everyone gets used to and says this is how it should be, and there are people who experience this thing, and are not willing to tolerate it and we think there is something that will allow us fix this thing.” Shatz laughs. When asked what motivates him in the third rodeo to raise the company, he replies that it is not trivial at all – “This act of leaving a company you built and moving into an empty room – is not a very pleasant action, and even if you think there is some injustice in the world, which you can correct, it Still doesn’t mean you have to do it yourself. I don’t think I started companies for good reasons, I don’t know if there are categories for entrepreneurs, but I’m probably a ‘bitter entrepreneur.’ That means every company is some kind of correction or change to an insult or a response to something that was In the previous company, which I thought was missed and was not good.” Schatz explains that each exit actually ended with a feeling of severe failure and not with success as things sometimes seem from the outside. “It’s funny to leave a startup with a sense of failure, but the mere fact that you were so close before does something. I’m a bitter entrepreneur who needs to get up from failure.”
Regarding the state of the cyber market today, Schatz says that “If you open the companies that make the purchases, you will find that everything is wrapped in masking tape and rock, because there is no choice. No one who built their startup company built it to be a product that integrates a lot of things, and connects everything together because there the question of the MVP. Therefore, the fact that we built everything in advance, and we do everything, and control everything and enable the integration of things – this is what gives us the advantage going forward. Because I think that the companies that made acquisitions will at some point have to dismantle everything and reassemble everything.”
When Assaf Rapaport was asked about the employees, he said that he will continue to recruit and also throw crazy parties because the employees are the core of the company, what do you think?
“I think there is also another side to this – you want to do what you can live with, and what you think is also fair to the employees. I don’t see that there is a decrease in salaries on the one hand, but there is a change in the attitude of how things look externally. We see the relative immunity of the cyber market, but on the other hand, predictions are a difficult thing, especially regarding the future” he laughs, “but I don’t think we will really see a quick return to the bubble world in the near future. It will probably be a difficult year or two.”