#278 The AI and Cybersecurity Convergence: Strategies for 2024 and Beyond With Shashank Tiwari

0:00:01 - Mehmet
Hello and welcome back to a new episode of the City of Show with Mehmet. Today, I'm very pleased to welcome back again Shashank Tiwari, ceo of Uno. Ai Shashank, it's nice to see you again here Now, as it's end of the year. We're doing a couple of myself I will be guest in some podcast as well to do a year in review, talk about what we are waiting in 2024 and beyond. So thank you for making the time again today with me, shashank. So first of all, tell me a little bit how was 2023 from business perspective, you know, and how can you, if you want, like, summarize how was this AI year, but from cybersecurity perspective? 

0:00:50 - Shashank
Absolutely Well. Firstly, thank you. Thank you so much for having me back. We had immense amounts of pleasure and fantastic conversation the last time we were together, which was a few months back. I'm glad that we're reconnecting and looking back at 2023 and seeing what the year ahead essentially the next one, the 2024 could bring for us. So good question, fantastic question, mehmet, like how was it for us? What learnings did we have? 

I think, broadly speaking, 2023 was, in my opinion, a year of turning point or an inflection point here. We came out of the post pandemic era, then there was massive amounts of euphoria getting into 2021-22, and then it started turning from extreme excitement into layoffs and a lot of sort of pullback across the world, with also the global world in turmoil. I thought 2023 was where sanity started creeping back in. And so, from our standpoint you know, being in this area of intersection of AI and cybersecurity, an area that is seeing a lot of traction, a lot of love, a lot of excitement we certainly had a very busy year, you know. So 2023 was super busy year, both on the side of product and innovation and then also on the aspects of, you know, just, broader market appetite. This was also from at least our standpoint from Uno AI standpoint. This was the time when we had the opportunity to do a general availability of our you know product, exciting product. So you know a lot more customer engagements. We matured from being an early access product into a full-fledged enterprise ready product with all the certifications and you know all the sort of bells and whistles added. So that also allowed us to engage quite a bit. And you know, as that always happens with every enterprise company experience, it goes through its motions, right, you learn, you adapt and you figure out which use cases have the maximum value. So, personally, we spent a lot of time there, but we certainly talked. 

Today. I think the market is extremely exciting and multiple companies had, I would say, a very profound experience in 2023. Some, of course, struggled, some even had to pull back and some even shut down some of the early ones, unfortunately but also it was a time when, you know, a lot of people stepped back and started looking at fundamentals once again, right, the focus was back on what value are we delivering out here? Why do we exist? Why should this company be there in the times to come? So I think it was really like a time of reckoning for a lot of companies, I think in venture building process. Having been in that world for so long is a good thing. Right, you always need that research, you always need those fundamentals to creep back in so that then you can have the opportunity to build generational companies. 

0:03:30 - Mehmet
Yeah, 100%, at what a year actually let's start to dissect 2023 from, because, at the end of the day, it's on top of mind of everyone's cybersecurity, and then we will touch on the AI part in that. So you know, every year we know, we know that, you know we have predictions from the previous year that the cyber attacks will increase. So I think indeed, we saw a lot of cyber attacks that happened. But from your perspective, shashank, like, have you seen any change in the way the threat actors have tried to change their I would say maybe tactics and strategies? Have we started to see a new trend of attacks again? Because I know you talk to a lot of you know leaders in cybersecurity through your day to day enrollment and engagement with your customers. So what have been, I mean, the top cybersecurity trends from customer perspective in your opinion? 

0:04:38 - Shashank
Yeah, it's a it's super important point and a great question there. Mehmet, if you start thinking about cybersecurity, it's been an ongoing, continuing conversation, right like a few years back. People, you know, leaders across board weren't even fully aware about the risks and the threats. Because of cybersecurity, that became front and center. 

As you know, we started seeing a lot more attacks attacks that were extremely punishing attacks that had, you know, sort of you know substantial ramifications in terms of losses, in terms of risks. 

So I think that's what woke the whole, you know, the enterprise world up a few years back. And what has happened in 2023, I feel, has been, at one level, continuation of that. You know, certainly there have been more varieties of attacks, more frequency of attacks and more types of threat actors and more types of attacks emerging. So that has certainly happened. There's no two ways on that. I do feel. So that I think that the attack sophistication has also changed. You know, one part that was discussed quite a bit in the beginning although we are not seeing so much manifest in the wild was about will the bad actors, will the threat actors, also start using all this interesting AI tools out there, and will we start having malware? Will we start having ransomware? Will we start having phishing attacks that will become impossible to detect because, you know, the AI enabled or the AI generated versions of these are going to be more nefarious or more difficult to get. 

So I think that debate has certainly popped up and you know people are talking about in the theoretical world. I don't know if that necessarily has been the biggest attack vector, though I think, like you know, it's a reality it was probably going to unfold, but we're not seeing too much evidence of that at the moment. So we're still continuing to see a lot of the attacks that have become prevalent from, you know, the standard sort of ransomware, phishing, centric unauthorized access, data leakage, you know, to some sort of exfiltration attacks, or those are certainly happened. We've also seen examples across board, from banking to healthcare to consumers, that you know the types of attacks and the sophistication have also increased. For example, we did end up even hearing, for example, you know, large manufacturing public companies like Clorox mentioned in their one of their sort of investor conversations that they were unable to meet their expected targets. I understand because they were unfortunately under, you know, rather on the receiving end of a cyber attack, you know, which caused their manufacturing ability to get hampered right, and so we are beginning to see some of those. 

We also saw, of course, you know, the unfolding of the big move it attack, which has led to substantial amounts of loss across companies, including healthcare data losses and you know a whole lot of other entities just impacted because of a third party vendor. So certainly the attacks, sophistication increased and you know there is a lot more of that goes without saying. In addition to that, I think, from a cybersecurity standpoint, of two other things became important in 2023. The rise of AI in an interesting way, also led to questions about security in the in the world of, in the domain of AI right or security in a post AI world. 

So there was a lot of conversation around breach of confidential data or privacy or attacks that could emerge from, you know, the availability and adoption of these broad language model centric. You know gen AI tools. Would that lead to some new type of attacks? And you know, certainly there has been a lot of conversation and study around it. 

We also started seeing a lot of conversation on privacy right now sometimes the cybersecurity aspects and the privacy aspects are kind of separated out, but I think now we are seeing a lot of convergence of that where the conversation of privacy is becoming front and center. Privacy, both in the traditional sense, are also in the you know sort of post AI world. There's also been a lot of talk about regulating AI from a privacy dimension apart from cybersecurity dimension, and you know that has also been you know a lot of concerns around both security risks as well as privacy risks with deep fakes and you know manipulated voice and manipulated videos and manipulated image content that can certainly be used quite effectively by malicious actors. And then they have also have been some attacks around that right when people have been impersonated and even larger enterprises have been fooled with those impersonated, deep fakes and made to believe and you know, actually ended up being part and parcel of those you know sort of malicious attacks that were carried out. 

So, certainly you know the attacks. Sophistication has increased and there is no stopping there. I think then, unfortunately, is going to be more of that in 2024 I think. 

0:09:25 - Mehmet
Yeah, you know you mentioned a couple of incidents and you know I think the biggest one, or the one that made a lot of noise, is the MGM one. Also as well, this is was one of the huge ones that, to you know, all over the world, everyone was talking about in and, by the way, it was not only in the US or North America, like, remember the beginning of the year, australia, like they faced a lot of data leaks from. You know telcos and healthcare. So do you have you mentioned one thing, shashank, about? You know the incident of Clorox, where you know they were telling the investors. So do you think that 2023 was the year where finally, let's say at least the CISO and the CIO were able to convey the message to the board about the real threats of from cybersecurity perspective, especially because you know it came at a stage where the AI started to accelerate as well? So do you think we reached this point where investors, board members, they now understand these threats in a better way than before? 

0:10:31 - Shashank
100%, 100%. 

I think there are multiple drivers for it, but you know one, of course, as you, as we both just discussed, right like all these attacks have become front and center and you know they have really caused meaningful damage, including the one like you mentioned on MGM, just kind of brought almost Las Vegas to a halt. 

And yes, there have been also rulings and sort of legal consequences. For example, the SolarWinds CSO was sort of charged for negligence, if you may, again, there's a whole case still unfolding, but there was some of those pieces also came through. This year the SEC also stepped up their own controls over cyber attacks and now they have, in fact a new regulation that is going live here for public companies, starting tomorrow, I believe on December 18th, which is really focused on active reporting and actively letting their consumers know. So broadly there is an incident that could have a material impact, as SEC likes to talk about it, which essentially is anything that is a consequence. Broadly put, usually some states out here mandate at least the party to disclose it and let their customers know and let their important parties know. 

But, now there's no more broad mandate from SEC is also going to push a lot of public companies into this spotlight, where they'll have to let the world know if there is an incident which has a material impact and in fact there's a timeline set for it, that they need to report that and explain that I believe within four days, if I've understood that correctly, and a lot of that ramifications of that unfold. 

So certainly, going back to your question, with all these severity of attacks, all the conversations underway, all the newer regulations coming through, all the consequences which is also manifesting sometimes in terms of real legal charges and stock prices tumbling down or other kinds of real impact to business. 

I think it has certainly become. There is, without a doubt that it has become a board level conversation. Today you don't have to do too much convincing, in fact, to the board or to the leadership or to investors that you do need a cybersecurity program. I don't think that is a trouble anymore. And it's also global. This problem is not just restricted to the United States, as you rightly mentioned. 

Attacks have unfolded around the world. There have been substantial attacks down in Australia, new Zealand, there have been attacks in Europe, there have been attacks in the Middle East, south Asia, just about everywhere, and each part of the world has seen the negative impact to these attacks. So I think certainly the conversation has bubbled up to the board level without a doubt. Yeah, I mean, the time is here. Let's put it that way. There's no more trying to convince that this is important. You should pay attention. It's already front and center. So I think there will be more conversations. In fact, I wouldn't doubt that now going forward cybersecurity and your cyber posture and how smart you're about. That will be in every conversation, as companies are valued, or companies are acquired, or people join a company, or the market weighs them or partners weigh them. I think that is perhaps going to creep into all those conversations eventually. 

0:13:52 - Mehmet
Yeah, indeed. And, shashank, if you want to also dissect where the CISO and the security team they're putting their efforts and budget in 2023, where they were more on the preventive part, which is good, or where the aftermath, where the things really start to kick and I know you as Unoai you can help them a lot. So have we start to see this understanding that's not only from preventing perspective. You need to think also about incident response, about getting things back. So how this changed during 2023?. 

0:14:39 - Shashank
Oh, absolutely yeah, I think the focus has become more holistic. The focus is certainly more comprehensive today, as opposed to just one piece of the puzzle, and so there is the classic sort of you can parse it two ways, if you may. You can think in terms of prevent, detect and then respond the classic way that cybersecurity has worked. 

And you can also parse it in a way where you think of an incident or an attack as the sort of focal point or the access point or the pivot point, and then you have everything you can do before that to try and prevent and avoid it, everything you can do while that is unfolding, and then everything you can do, which, unfortunately, you are still subject to one. And I think all three have become very important because prevention is super critical. That's how you would get evaluated CISOs and the cybersecurity teams would get evaluated in terms of how great are they at preventing, how great are they at understanding threats. And then, of course, absolutely as you rightly said that despite all your controls, despite all your good hygiene and health and all your strategic thinking, you might still end up coming under an attack and it might become something that could lead to damage and may even lead to substantial damage. And in that case, I think it would be a lot about how do you understand the incident quickly, how you're able to respond to it at a very fast rate, how we're able to piece the story together, how you're able to get to the bottom of that at a very rapid pace. So certainly that has become an important piece of the puzzle. And then, even beyond that, and which is where that, unfortunately, you were hacked. Unfortunately, you had a compromise. Unfortunately, you had data leakage and unauthorized access, but now you need to go and understand that to a level of detail that you can assess the damage accurately, whether it's from a standpoint of claiming your cyber insurance or reporting it to your investors and customers, or to giving the assurance to the broader world that I have understood how bad that particular incident was and I have made sure that, going forward, such kinds of incidents are definitely going to be avoided and that we have really upped our game. So I think it's all of the three that have become important. 

I must mention to Mehmet that it's been tough to be a CISO I think in 2023. And I speak to a lot of them because I essentially service that market and a lot of them are good friends as well. Many of them have also seen their budgets being cut or they're being questioned, because there's pressure, of course, to up the cybersecurity game. But also companies at large have felt the pressure in terms of declining revenue or the broader rise of interest rates or instability in the world, and so they've also asked them to just do more with less, and so I think there has been, of course, the broader mandate of go up your game, but also up your game. 

While we might not give you more resources, more money and more time for you to figure stuff out, go figure it out sooner. Go figure it out more efficiently. Go figure it out, make things more effective with whatever you've got. So I think certainly the bar has been raised and I think there's no going back, but also there is a major push towards effectiveness and efficiency. So it's a tough one. It's a tough one for them and I don't think it's easing out. It's only going to get more competitive and tougher. 

0:17:57 - Mehmet
Yeah, that resonates a lot Even here on the local market level. Maybe you know also, shah Shah, the same thing. Although we don't feel the economical pressure same as the rest of the world, still kind of things moving, projects going on, but yeah, every single season they are feeling very stressed. And now coming to the AI. So, although it can be utilized from cybersecurity perspective, both on the, I would say, offense and defense side, but what I'm hearing from not only Seizos, like everyone on the management at customers that this AI thing actually it brought new projects and these new projects means new threat, like vectors to them and they needed to keep it up between adopting the new technology and, at the same time, keeping things improper, I would say, at least protected, the way it should do. 

But AI raised this issues about privacy, about how you handle it, and we heard a lot of stories about even big companies that their data were actually put with open AI charge, ept, and the data were leaked. So how are you seeing this new AI thing? Because you know, it's a fact. I remember the time I think we spoke in August or July, so still it was like people trying to figure out what is this new AI thing is. But now it's well seen that you cannot continue your business without having AI. So how are you seeing people doing this balance between adopting the AI while keeping the things secure also as well? 

0:19:53 - Shashank
Yeah, yeah, no, no, absolutely. I mean, ai's moment is here. It is not too good on that, and I think what we have seen in the last, I would say, a year or so, especially after November 30th 2022, when chat GPT was first introduced to the world Of course, there's a lot of work that has gone on prior to that, including people like us who were heads down building some interesting language based and transformer based models, but, you know, broadly speaking, the world sort of was awakened or re-awakened with the promise of AI post, that. You know the big launch. And so, as we came into 2023, it was very evident that it had, you know, made inroads everywhere. Right, it had made inroads from consumer facing apps. It had made inroads into creative disciplines and copywriting. You know. It had made inroads into planning your trip, to running your marketing campaign to, you know, doing things in the world of, you know, creative storylines and you know, so on and so forth, right and just, the applications were emerging every day, and the same thing happened in cybersecurity as well. 

We did see, as you rightly said, you know, sort of emergence of both sides of the coin. You know, on one side, everybody got enthusiastic about AI and, of course, as it happens in the world of cybersecurity, you know everyone starts adopting certain buzzwords or certain trends and starts incorporating into the products at a very rapid pace, and we certainly saw that with Gen AI as well. Large players, small players, new players everybody started speaking. You know the gospel of Gen AI. You certainly saw that, you know, on the floors of RSA. You certainly saw that on the soundbites. You know that were generated and created by all kinds of cybersecurity vendors and you also saw that you know across from analysts to the industry, kind of, you know, talking about it and discussing it actively. So certainly you know, from a standpoint of what you could call, ai for security became a topic. 

Now, as AI for security became a topic, the SISOs, obviously, and, you know, security leaders, started getting interested and started getting, I would say, more curious about where this time AI could take them right. 

In the past, ai had been looked at more of a pattern recognition, you know, platform or a pattern recognition software, and now the idea was well, in this new generation or new form that AI is taking, could it do more than that? Right, and I think there was a lot of conversation that started emerging about could AI be an enabler that could start making them more productive? Could this be the one that can help their people up their game right? So there was a lot of that conversation that emerged and so folks jumped onto it and you know, obviously the most accessible, easy to plug into and start experimenting with was, you know, chat, gpt, and you know the OpenAI APIs Post. That, of course, as we have seen, you know, there's been emerging multiple alternatives out there. And then, of course, the rise of open source, and all of them have emerged and you know, I would argue, in a faster rate than OpenAI. 

And you know, some of them are competing quite, quite well with OpenAI and you see them, I truly believe some of them, you know, outsmart the chat, gpt and OpenAI or you know sort of platform, as we see today. But having said that, I think as soon as these companies started playing with AI, the very first question that started becoming was what about security for AI? Right? So we are looking at AI for security, like you know, we are going to use the power of AI to run our security programs better. But how about vice versa? You know, because this is going to impose on us or create on us a new set of challenges. You know, is that going to be actually more troublesome than the benefits we'll get from AI, right? 

So there's been this whole debate, if you may, that has emerged over the last multiple months, which is the AI for security versus security for AI, right? 

So you're on one side, trying to look at the promise of you know how you could leverage AI to become smarter better, do more, you know, unleash the capability that you probably don't have today. 

So that's the whole AI for security. And the other side, you are being pulled back by the concerns or the real threats or risk of you know, what about security for AI? Is this going to impose a new kind of problems? Am I going to run into new type of injection attacks? Am I, you know, going to inadvertently leak my confidential data? Or, you know, proprietary data or some privacy sort of a piece puzzle might get unfortunately harmed, because now I am trying to just open up my enterprise data and my internal data to this AI engine, which sort of is like a black box and it's very hard to kind of, you know, unwind from it. So I think like that has been the biggest debate honestly, you know, ai for security versus security for AI, definitely causing a lot of cyber professionals to also be equally cautious, as they're optimistic, you know, they're just kind of struggling internally. There's two sentiments simultaneously, you know, sort of coming at them. 

0:24:54 - Mehmet
Yeah, now moving to next year. What do you think you know? Of course, ai will be one of the top of minds, right, but what other trends are you expecting to see next year, shashank Especially, you know? Like this, I think it looks like, as they say, the genie is out of the box and you cannot return it back. So it's indeed, but the things that we are trying to see, especially in the last two months, it's really, you know, although, like, I try to cover every day, as you know, and I try to read a lot, but sometimes I'm feeling myself like very late to the party, as they say. So are we going to see the same momentum continuing next year and how this will affect, again, cyber security and, you know, the whole technology market in your opinion? 

0:25:43 - Shashank
Yeah, yeah, no, no, absolutely. In fact, I'm going to step back a little bit and try and give my two cents in terms of how I feel 2024 is going to be, and you know that will hopefully also answer the question of AI and cyber in the future. 

So my belief is that 2024 is going to be a very important year for us, and what I mean by that is important to you, not just for us as a company, or you know us as a sort of a sector working in this domain, but I think, just broadly for humankind. And what I mean by that is, you know we had a very unusual last few years. You know the post 2000 era led to the rise of internet and then we saw the whole emergence of mobile phones. You know the world has really changed post the internet and mobile phones. We saw rapid growth over 10 years. You know more than 10 years of, you know, bull run, where so many applications, so many companies were built. You know it changed the way we interacted with the world. It changed the way we interact with each other, it changed the way how we did business. 

And so certainly, we became a different world in 2020, if you may, as opposed to why. What we were at, you know, the beginning of the millennium, you know 2000. So 20 years was really like substantially transformative, I think, for the world at large, and certainly it manifested, you know, quite a debate in the world of business, right. And then we, of course, were, you know, faced with this big global pandemic, and the global pandemic, in some sense in my mind, was the big reset right when we all stepped back and you know, then we saw, of course, the extreme cautious period led by the extreme euphoria, and you know, then, last year or whatever, this year, rather, you know 2023 being like the inflection point here, you know, where things were kind of setting back to normalcy. Now, what I mean by that is, I think 2024, in my opinion, is the beginning of the next leg, or the next era of the big transformative change that we're going to see over the next 10 to 20 years. So, just like we saw the internet and the mobile phone and that led to, you know, something very substantial over a 20 year period, I think we have already at the beginning of that next leg, or the next generation of that big change, which means that this is what is begun to unfold in 2023. It will take shape quite a bit in 2024. And that will lead towards the, you know, the vision 2030s and the vision 2040s and 50s where we are really looking at. 

You know certainly very different world from what it is today. So now, piecing that together and stepping back, what does that mean? I think AI is going to pay a very big part in that puzzle, more than just AI alone. I think amplifications and ramifications of AI will have a big impact in terms of you know, they will start becoming more pervasive. They will start hinting into consumer goods. They are already there in many instances. You know, for example, a lot of the modern cars have substantial amount of you know, computer vision sort of abilities built into it. But you will start seeing this next generation of you know autonomous driving, you know autonomous flying, perhaps you know and stuff like that that will start becoming bigger and bigger. 

So the applications in multiple ways, right Intelligence kind of permeating across society and therefore the rise of AI will become, you know, a lot more than what we see today. 

Now, of course, you know, with the rise of AI, not only would there be various kinds of threats, but also there would be various types of opportunities. So you know more back home, you know more close home. If you start thinking in terms of cybersecurity, of course you know it's going to be a bigger puzzle, but I would also say that it's going to be way beyond and be bigger than just cyber and AI. There's going to be substantial impact in terms of the way we interact with people, the way we work, the way we entertain ourselves, the way we, you know, explore the world, the way we learn about things, you know like. All of that is going to get impacted in substantial ways, right, and that will be sort of the first inklings of that would start coming in 2024. Now, what does that also mean? One more bit that I want to mention is that that can create a lot of opportunities. I think that you want to see the emergence of a new set of opportunities, and the piece of those opportunities becoming available and people jumping in to fill the white space or the gaps is also going to increase. So you know, just the same way that this year we saw we chat. Gpt opens an opportunity. Now you have like 15 different large foundational models and you know 500 different other companies working a layer about that. And then there's the rise of open source, and you know there is all kinds of applications that is thinking how can we take AI to the next level? I think that will only accelerate. So I think, if you start thinking about 2024, I have the feeling the first half of 2024 will actually see 2x the speed that we have already seen, which itself, as you rightly mentioned, is becoming impossible to keep pace with. There's just so much happening, like you know really have to be on top of it. Only do that full time to even just be aware of what's happening. So that's going to become 2x. So just imagine. You know that's going to become fairly chaotic, but a lot more opportunity. That's what I think, but you know. 

The another part I want to add to this, though, is that it's possible that you know, like any hype cycle, it might get overhyped in some sense at some point in time, and that could lead to certain disappointment as well, in the sense that people might just get ahead of themselves and feel like what might become true in 2030 is actually going to become true in November of 2024. Right, and so they will just overindex on some things or get over optimistic and then, as it happens with humankind, you know, we get overly exuberant about something. If it doesn't match up, you know, or match our expectations, we certainly become very depressed about it and feel like, hey, this is a promise where we got cheated on, right. So I feel like it's possible that second half of 20 or 24 might also see a little bit of reset there. 

People feel like, hey, we invested so much time, money, energy, ai is in becoming what we thought it's becoming, so you have to give it some time too. I think like it'll take its own time, just like the internet did, right. Like just like the mobile phone did. It has to go through its own adoption curve and it will go through its own hype cycle. It will go through its own norming, farming. But I do feel that, in the long run, 2024 is going to be a fantastic year, and I think this is the year to seize the opportunity for everyone. 

0:31:49 - Mehmet
Yeah, hopefully, and to your point I agree with you. Like you know, when people get so excited about something and then you know they put expectations that actually are not realistic and they say, oh no, like this is not. And this is reminding me, you know, in the early days, when you know some companies they tried to come out with. You know small devices, hand devices, you know, like the palm and the other ones, and you know it didn't work with them until the right moment came again, and then you have the iPads and the surface and all this. 

So yeah, pretty much I think the same thing is already happening today, because people you know this is what I try also to cover on the show that you know, like the AI thing is not only what you see through a chat box and we talked about that the last time, yeah, but I'm also like very excited because now we have some, because I have something against, you know, the company, but I love to see at least two players in the same domain. So now we have another player to challenge open AI, and this is good because they're going to be forced to innovate, the others are going to be forced to innovate, so everyone will be a winner at the end. Now, shifting a little bit gears. So we talked about the market and how the market was tough. So I know for a fact the market was tough in the US and in Europe and in some other part of the world. It was not the case, honestly, here in the Middle East, and you know I've met you, I had the chance to meet you face to face here in Dubai. 

So, from your perspective, how did you see? You know? First let me break it down into questions. So first, are we going to have a better market conditions globally next year from. You know, of course, all the discussions you are having with the executives and so on. Second question how are you seeing? You know my region, you know the Middle East region between Dubai, united Arab Emirates, saudi Arabia. How did you see or saw the difference in the dynamics, I would say, in the market, between the US and this part of the world? 

0:33:54 - Shashank
Yeah, lots of fantastic questions there, mehmet, and you know, lots of learning for me this year. As you know, I you know, not only I'm, you know actively building a company in the midst of all of these conversations with various kinds of leaders here, but I had the chance to go and interact with a lot of leaders in the Middle East as well, and continue to do so. So let me let me answer the first one first, about the US markets, and you know the global market at large and you know. Then, of course, we can cover some more on the Middle East per se, because I think there's a lot of exciting stuff to talk about that region as well. 

So, if you think about the US markets, it was actually a confusing market in 2023. I wouldn't necessarily say it was a negative market or a market which was going through a recession Because, honestly speaking, I think, although we did see the rise of interest rates, it is generally a low interest rate country with a high growth type of very optimistic type of a system where people like to invest and spend and therefore like to grow onto the next set of promises. That certainly pulled back a tiny bit because of the rising interest rates. There was certainly a little bit more conservative approach to things, where companies which had gotten ahead of themselves during the pandemic period started laying off and kind of self-connecting a little bit. But at a broader level though, I do feel that the American economy still came out very strong For companies that were doing meaningful work. There were still plenty of business on the table the stock markets, if you start thinking about it for companies that have strong fundamentals, it ordered them. 

Sure enough, they were not the euphereal level sort of valuations that we saw in late 2020, 2021 period. Certainly, there was a little bit of correction but, having said that, I think we did see the market bounce back and we did see the market reward all the ones who had the fundamentals strong and revenue growth occurring in a good, positive manner. That was also very evident. 

If you start looking at people who invested in AI, for example, the Microsoft stock certainly saw a very positive upward movement. Same thing happened in the world of cybersecurity. You did see a lot of strong performance from players like the larger ones, like Palo Alto Networks, CrowdStrike or the various others. I think overall, the market wasn't really I would say as much in a depressed state or kind of recession, but it was more in a corrective state. It was more in a pullback. Let's reset, let's go back to fundamentals, let's focus on what really can help us succeed in the long run. 

I think that's what ended up happening. Of course, it was deliberate as well, with the Fed kind of increasing the rates. Now I do feel like it will pave its way towards things easing out and the market kind of getting more buoyant in 2024 and perhaps towards the end of 2024, coming back, as I was saying, more towards normalcy, where you start seeing the public markets becoming more receptive to IPOs and the broader business becoming a little bit more optimistic. So that's certainly going to be, I think, the sentiment At least that's my hunch, based on all the data that I have seen after all the conversations I've had and then I feel would also impact the global sentiment. I think a large part of Europe, which certainly is more closely linked with the way the American economy works or a large part of East Asia is also going to see a lot of that happen. 

Now, having said that, the world still has a couple of unknowns that people are not able to piece completely together. 

I mean, there are a couple of sort of live wars underway, if you may. There is a lot of geopolitical pre-alignment that's going on and I think certainly the global markets at some level are worried about it and trying to understand the scale of the impact of that. But I do feel that I think eventually peace will prevail and all of those things will find its path and we will start seeing 2024 onwards, a little bit more normalization and broader focus on commerce, broader focus on growth, broader focus on collaboration, broader focus on positive energy, and that would just kind of propel itself up. So I think that's my sort of broader sentiment. I'm an optimistic person by nature, but also I do want to, as I always do, a realistic sense of my understanding of the market and, given my own personal optimistic outlook plus understanding of everything that I have been ingesting and understanding, both from other experts in the field from executives and investors on one side to just looking at the data. 

I do feel very convinced about it, so I think that's my sort of broader take there. 

Now, talking about Middle East, so Middle East was, in my experience in 2023 was, like I mentioned, an extremely educational period for me. What I did take away from my Middle East, you know interaction with customers and the government, and just understanding the markets at large. We were lucky enough to be included in some interesting initiatives that are spearheaded by the Dubai government. As an example, I ended up making a trip to Saudi Arabia and saw what was going on there. I also got a chance to speak at one of the largest FinTech conferences there, where I was generous enough to call me as a guest there. We've started doing business with some of the largest enterprises in that region, based on all of these different sorts of inputs. 

There are two or three sentiments that I really took away and I continue to feel very excited about. One is that that region at large, of course, led by UAE and Saudi Arabia, I would say, and maybe even Qatar, although my understanding on that market is a little lesser than the other two is that there is a lot of enthusiasm and there is a lot of deliberate ambition and deliberate excitement to go invest in technology. So I think that's something that is very evident. That's something that is very clear. It's not just words being spewed out there, it's not just larger charters being set out there, but there are very deliberate efforts being made with terms of committees being set up, the money being put behind it, invitation to a lot of global players to become part of the puzzle. So I do feel that I think there is a huge desire to become a technology leader. That whole region is very, very curious about it and very, very committed to it, which I think will take that region at multiple accelerated pace if you met a very fast speed into the future. I'll do a lot of excellent sort of productive outcomes for that region. So I really feel bullish about it and I feel like that's excellent for them. 

The second part that I also saw was that I think, broadly speaking, the leaders out there at all levels, from government leaders to corporate leaders to the just leaders at all levels of management in that region are very, very hungry to learn, are extremely I would say at some level, very humble and extremely inviting and do want to include the world in their journey. So they are already committing a lot of their energy, their money, their sort of desire to go build the next world, but at the same time, they are doing this in a very inclusive fashion. They're really inviting people from all over the world to come and be part of that journey and they are being, I would say, extremely humble and generous and extremely good in wanting to learn from everybody, and that's, at least, was my personal experience. A lot of people gave me a lot of, I would say, audience and included all the inputs that was coming from my own experience, out of Silicon Valley, out of building tech companies, and those inputs were taken very seriously and those inputs continue to be taken with a lot of good thought and in a very positive way, because they do see that learning from people's experiences around the world would actually help them incorporate a lot of that goodness from all over the world into the programs that they're running. So I felt like that was phenomenal right. That was very, very good and very nice of them, and I think I do hope them all success in that domain. And I also see that happening across board local academia. They're infusing professors being brought in from the best university. In fact, one of our collaborators in the region who we really like, has come out of Carnegie Mellon University and right now is spearheading a lot of that initiative in MBs UAI in Abu Dhabi, right. So this is not uncommon at all. A lot of this is going on. 

And then, last but not the least, I do feel like they have put a certain timeline to it. 

See, sometimes any region, any area could be very ambitious. 

They want to achieve things, but if they don't put a certain timeline to it, it becomes an open-ended goal, and open-ended goals typically, I think in my opinion at least and my worldview of years of seeing many global markets sometimes don't really pan out, because until you put a certain goal and time to it, the realization of those goals become more of an ambition, less of a reality. 

But I do feel that here in that region talk about Saudi Arabia as an example very aggressive timelines for what they want to do by 2030. Similarly, uae has some very important mandates and missions in terms of what they want to accomplish in a year and a year basis and definitely, again that Vision 2030 plays in. They also have humongous ambitions for way further out. I believe it's 71, 20, 71, or it'll be 100 years of UAE, but they're already kind of planning with that in mind of what UAE should look like 20, 71. And they have so many programs today underway with that 20, 71 vision and how we would reach that majestic vision that we have. So I feel like I feel very thrilled. Every time I go there, I'm very enthused, energized, just seeing people who are so committed and just so enthusiastic and so full of life and wanting to do things. 

So that's my takeaway, but it was my learning year in 2023. I don't have much of a history in that region before this, but I must say that I really learned a lot and continue to cherish that, and look forward to doing more in that region. 

0:44:13 - Mehmet
That's great, chajag, to hear, and I personally, on a personal level, I want to congratulate you because you at least came out from all the way from California, from the Silicon Valley. You came here to the region and you saw in your eyes what's happening and how dynamic is the scene and, honestly speaking, very few CEOs or co-founders they take this step to go and and I love this approach because, at the end, you're doing this for the company as well, because it's like any other company, you need to find ways to open new markets and you came out all the way there. We met, by the way, in the area called 2071 Area with Chashire. So, yeah, it's a place where they have a lot of programs in place, incubators and even some VCs. They sit there as well. And, to your point, one of the things that I noticed in 2023, when everyone actually started since pandemic, to be honest with you and this is where I felt like this is going to happen later, because in pandemic 2020, when everywhere was closed, this was one of the few places in the world where you can go. Of course, we used to take the precautions and so on, but I mean business. I will not say as usual, but very close to as usual and by 2021,. 

We had the expo hits, so millions of people came, but from business perspective, especially because we are in tech, so I started to see this message to the world that we want to become. It's not a replacement, but because there is nothing that can replace something else. I don't believe in this, but we want to be like Silicon Valley. We want to be one of the few hops in the world like Silicon Valley and many people they don't know that there is another major hub in the US which is in Texas. I know that, for effect, london, singapore, all these major technology hubs, so Dubai and the other Emirates and the Saudi Arabia, they want to have this. So this is again congratulations on having this step, shashank, because I think you saw the results immediately. Now I know and I'm mentioning this because I know a lot of audience are from the US Guys, don't be afraid of coming to the region. 

You might hear a lot of myths, you know, like yeah, there is business is not stable and no, no, that's not true. So, of course, maybe our cycles are different a little bit, but you know, the business is here and the initiatives are real. They are not just as Shashank mentioned, they are not just on the paper. So we see this, you know, every day, every couple of days, we have a new initiatives and this initiative, as you mentioned, shashank, like it has some timelines. So again, congratulations on having you know the operations running here in the region. I believe you know because what, also from technology perspective, you're trying to solve a real problem which we face here as well in the region. So this is why I believe you know you will have a success. 

Now, last thing, before we close Shashank, and because it's related to the markets. I was hearing from a lot of people that it was a dry market for companies who are trying to raise funds this year. Is this also changing? I'm optimistic, like you, by the way, I believe 2024 will be much better. But for startups, because I know that a lot of startups, they unfortunately they run out of cash and I know for a fact even they, some of them, they try to come here to the region. Of course, the dynamics of the region from fundraising is not similar to the US, even from scale perspective, but are things easing up next year when companies say I mean I need your advice for a founder who's about to raise funds like will his or her life will be much easier in 2024 or it will be tough, same as 2023? 

0:48:14 - Shashank
It's a good question and you know, certainly it's. You know it's. It's something that I understand well. Broadly speaking, mehmet, I think it's been a tough year for fundraising for the broader markets in 2023. Right, so 2023 was a year that the member was was essentially a period that was the post 2021 boom, right. 

And so what that really means is people had over invested, people have invested, you know, at much higher valuations and they had seen the market pull back. And, as it happens in the case of investing, a lot of that is emotional, a lot of that is behavior driven, a lot of that is, you know, sort of either it's fear or greed driven, and I think fear had really caught the broader sentiment. So certainly we saw a lot of, you know, funds becoming a lot more cautious, writing fewer checks, writing smaller checks, you know, asking for more scrutiny, looking at more fundamentals. You know, certainly the whole mood changed in 2023. And you know that meant that for a lot of companies, it had become, you know, incredibly hard to raise whatever round they were raising. I think the earlier phase rounds were still more active, but if you're a slightly later stage company, it had become even tougher and unless you were new or the exceptional company that had all the numbers and everything else in your favor, it had become even more difficult because ultimately, I think for a lot of these funds that invest in late stage, they were unclear about what the exit is going to look like, given that the public markets were drying up and, you know IPOs weren't happening at the same rate you know that they had seen in the prior few years, so certainly it was a very tough year right in 2023. 

The only segment that continued to see love was AI. In fact, I think that you know AI certainly was one place where you continue to see some you know, higher evaluations than normal. You also saw investors get, you know, excited about it and, you know, get into deals. So you know that was the only one. I think we were seeing a bunch of deals happen in 2023. Plus, in addition to that, we also saw that you know, certain other evergreen markets is what I would call them, including cybersecurity continue to see activity right. So they were raises and you know they were infusion of funds all across board. Again, a little bit more conservative than prior years, at least the immediate prior couple of years, but nonetheless, I think there was some activity. 

Now, having said that, if you were building a SaaS company, if you were building, you know, a company that didn't fall into a couple of these you know special categories for whatever reason, you were still a great business. I think you struggled with raising money because it was just a tough market. You know I could see that up close, because you know we are in this segment, in that sort of intersection of AI and cyber, so we get a lot of love. We kept on getting a lot of inbound interest. We also added in some tiny bits of capital and you know we raised more as we were progressing. But that was because of multiple reasons, not only because we have had very compelling product and platform, but also all the progress we've been making. But, to be very truthful, I think we were the exception rather than the norm. I think that, in general, the norm was extremely difficult market and there's no two ways on that. And even for people like us, I think, compared to the prior year, we had to do more justification, you know, more explanation to do whatever we were able to do in 2023. 

Now, walking into 2024, which is, I think, what you kind of pointed towards, like hey, if you're a founder today, and raising, given what you know, what we both have kind of discussed right now type market, what would 2024 look like? My suspicion is 2024 is going to be a slightly better year than 2023 in terms of fundraising, the reason being that you know, ultimately for a lot of these funds, they also have to do deals because they have their own charters. They usually have a 10 year horizon. You know they have money sitting there, dry powder they got to deploy it. Their charter is not to just keep the money in the bank. So you know, definitely there'll be more activity. 

But I do not see them deviating from a cautious approach. So they will certainly do a lot more scrutiny. They'll expect a lot more progress. They'll expect a lot more of, you know, thoughtful sort of company building at all levels, from founders ability to pull it off. To, you know, is there a little demand for that product? To you know, product market fit. If you're a little further along, to you know, what does the market size look like? Like all of those questions that normally investors anyway indulge in, I think are going to become pieces that they will certainly want to make sure that they're comfortable with, right. So that certainly there's going to be a bit of that. 

But having said that, I do feel that the second half of 2024, and usually, at least in the US, there are two cycles when it comes to fundraising, I mean again, globally it's different and I know in, you know, in the EMEA markets there are generally a little bit more. You know a process centric, a little bit more conservative in terms. You know, and also I think there are big funds there I mean they're humongous large funds also in that region which also play quite actively in the US markets. For example, the funds are the Saudi Arabia. You know, some of the sovereign set setting out of Abu Dhabi or Dubai. You know these guys are global players but nonetheless, I think at the broader segment, just to a certain different style, that an approach that they take. 

But if you start looking at it, here's the US markets, and this is again a guesstimate. There are usually two cycles. One round of funding usually gets active somewhere around beginning of the year, which goes on till about, you know, spring. Usually you see a lot of activity in the February, march type of timeframe. Then you know summer sets in and things, you know, sort of taper off a little bit and then things pick up again in the fall, right as we will come back after the vacations and you know they want to do a few more deals before they close the year. 

You see a lot of activity in the September, october type of time. From like basically late August to early November is when a lot of deals get done. My hunch is 2024, you will see a bunch of deals being done and so the markets, you know, becoming a little more open, but the second half might see a lot more activity. And the second half might see a lot more activity because I, by then, assuming that everything that we are expecting 2024 to kind of, you know, deliver for us as a society, probably will start coming through and things will start getting more back towards normal globally. And also, I think the second part would be that the public markets, I think, would start getting into a mode where they might become more receptive towards, you know, an IPO or you know more. 

MNA activity will increase, which generally has a downstream impact of, you know, generally the funding community getting more excited and saying, okay, let's go write more checks. You know, let's fund more companies because there's an opportunity to build a lot of generational companies and you know there's a lot of transformation that we're going to see in the times ahead, so now is the time to invest. 

0:54:57 - Mehmet
So I think that's how I kind of think about and probably speaking yeah, hopefully everyone is waiting more IPOs in 2024, I believe, because there are a lot of companies that are due. I know in the US they are due to IPO. And good, you mentioned Shashank about you know, like the 10 years of the VC's, because they have to get this money. They take it from their LPs and they need, and you know, as GPs, they need to spend, not to spend. They need to invest that money to your point and it's good. You mentioned that. It would be educational if someone in the US or someone who's not from this region about how these big funds here in the Middle East they act, even the VC's, by the way. So yes, as you mentioned, they are more cautious. Ticket sizes are not same as the ticket size in the US. So what might be a seed fund in the US might be a pre-seed thing here. And you know what's series A. You know like the numbers change a lot. So, yes, of course, like seed fund of two million or three million dollars is something normal in the US. So here they don't call it seed, it's like a series A or something like this. So these numbers can change. But good, you mentioned that, shashank, and yeah, so, like this. You know. 

Really, I think we covered quite good about 2023 and what we are waiting for 2024. And I love this time we had the chance to talk about the market and the conditions. And again, thank you, shashank, for making the time second time with me actually third time, because we met one time face to face also as well and hope to see you when you are back in the UE and in the region, and thank you very much for sharing your expectations for 2024. And you know, as usual, this is how we end every episode. Thank you for tuning in. I hope you loved this episode with Shashank. We are trying to do a review and projections for 2024. We have a couple of these down the road also as well. So thank you very much for tuning in and we'll see you again very soon. Thank you. 

0:57:02 - Shashank
Thank you so much. Thanks for having me again, my pleasure.