May 3, 2024 - Technology

Investors eye AI potential at RSA

Illustration of pile of money with hovering cursor

Illustration: Eniola Odetunde/Axios

Cyber investors are heading to the annual RSA cybersecurity conference next week ready to write checks for artificial intelligence security startups.

Why it matters: Cybersecurity funding has been harder to secure in recent years as customers have slimmed down their tech stacks and investors have reassessed which types of security tools they want in their portfolios.

The big picture: So far, new generative AI security products have primarily focused on synthesizing threat intelligence for defenders or scanning known vulnerability lists.

  • Investors told Axios they're eager to hear from companies that are taking these ideas a step further, including by focusing on securing AI models themselves or developing tools to detect deepfakes and other AI-generated content.

Zoom out: RSA typically brings in hundreds of cybersecurity entrepreneurs hoping to land new investments and customer contracts.

  • Many investors come to "try and help shape the crystal ball," Hugh Thompson, executive chairman of the RSA Conference, told Axios.
  • More startups also seem eager to raise capital and meet with investors at RSA this year, Dave Zilberman, a general partner at Norwest Venture Partners, told Axios.

Zoom in: The vast majority of the 10 finalist startups competing in RSA's Innovation Sandbox this year are focused on AI, Thompson said.

  • Last year, just one finalist focused solely on AI: HiddenLayer, which ended up winning the title of most innovative startup.

Between the lines: Right now, AI security seems to be in an "awkward teenage phrase," Zilberman said. It has a lot of potential, but its long-term impact is still yet to be seen, he added.

  • Ballistic Ventures — a venture capital fund run by cybersecurity heavyweights — has been eying AI security investments that focus on helping companies keep confidential data out of models and create tools that help detect AI-generated misinformation, founding partner Barmak Meftah told Axios.
  • Zilberman said he's keen to hear how startups plan to compete with major cybersecurity vendors that have large customer bases and are already deploying their own AI security tools.

The bottom line: Entrepreneurs will have success if they show up at RSA with a succinct 30-second pitch that highlights their competitive advantages, the team behind the company, and the problem they're solving, Thompson said.

  • Zilberman added that in meetings with security startups, he prioritizes learning about the potential customer demand for the company's product.

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