A (15:25)

RSAC Innovation Sandbox Contest is the leading contest that helps identify the future of where the industry is going. We have selected judges that represent different perspectives and can provide a test for each of those entrepreneurs that are coming on the stage, whether it's as a buyer, whether it's as somebody that we could be a design partner from JPMorgan Chase, whether it's somebody that is like Dave Chen, who is taking Wiz transaction to the final place. He's seen what the companies do, what it takes to get a company to be at that final sale. We have somebody that represents the national security side. And then we have Paul Kocher, who's on this interview with us today, who is helping us really identify from an entrepreneur's perspective, as well as testing the actual technologies that are underlying and underpinning what's on the stage, to make sure that they have something there there for you to review. So that is the Innovation Sandbox Contest. It's really helping people identify to rise the signal above the noise. This is the first place to come and to take a look at those kind of companies that are cutting edge. That will be the names that you will know tomorrow.

B (16:35)

And there is a substantial investment on the line here, right?

A (16:41)

Well, actually, yes. In order for you to be on our stage, there is a $5 million investment that comes from Crosspoint Capital. So each of the top 10 have already received their 5 million DOL investment. And so that makes it so that they have the opportunity to take that money and actually use it right away to execute on being named one of the top 10 finalists. Once you get named one of these finalists, the whole industry's eyes are on you, and there's a lot of people paying attention. This gives the companies the leverage they need to actually execute on all of that attention and really hopefully see some change in the marketplace for 2027, and we'll see that they get there.

B (17:21)

So, Paul, you've been a judge here. This isn't your first year, so you've done this a number of times. What do you look forward to here? What's your part as a judge?

C (17:30)

And I come from a more technical direction, so I like seeing what technical approaches the companies are taking, how they're going about trying to stand out in a market that's just incredibly crowded. It's also a place where the entrants don't have kind of the inertia and legacy problems and technical debt of the incumbents. It's also really fun to see how the market is tipping and tilting, where you've got these different participants with different natural advantages. This is really a place where you can see one side of that really playing out. Then the conference show floor tends to be where you see the other side of it. The incumbents who have a lot of these different advantages, like customer relationships, highlighting their strengths. It's my annual chance to really see both how the technology and the industry are shifting.

B (18:15)

Can you give us a preview of some of the finalists here? And perhaps if there were any patterns or trends that's reflected in who made it to the final list, one level,

C (18:26)

the trend isn't surprising. I mean, this year, nine or ten of, depending on how you count of the companies on the stage, basically all of them have AI as a big part of what they're doing. There are a couple other things that have gone quieter. Like a few years ago, we had quite a few cryptocurrency companies, many fewer, 01 major entrants there this year. The salient truly stands out this year, though, is AI is no longer kind of a differentiator by itself. It's assumed that everybody's going to have AI as part of their fundamental strategy. And it's really a question of how companies are using this technology, how they're adapting to it. Even the sort of philosophies are different, like how it shifts, this interplay between offense and defense. We're seeing AI dramatically empowering offense, dramatically empowering defense. I don't personally know how the balance is going to shift, and that's one of the things that I think I'm going to learn more about at the conference. But it's clear that the way things were being done a couple years ago is not the way that they're going to be done a year or two from now. And this is really a place where those trends are going to be surfacing.

B (19:28)

Well, and as a judge, what are the things that you're looking for? What can one of these contestants do to stand out from the crowd?

C (19:36)

I mean, I'm going to begin by saying it's an impossible problem because we're trying to compare not even apples and oranges, it's, you know, cars and oranges. And it's not like there's any kind of single objective criteria that you can use to decide which innovation, for example, is the best or even where the market's going to go. So I've got to approach it with a great deal of humility because I know that there are an enormous number of things that I Don't know. And then on top of that, there are lots of things that are unknowable. There are certain trends, though. If you have a really strong team, those are more likely to be successful than teams that aren't as good, mature. There's a piece around the technology about whether there's really a new approach or a new. In some cases it's an algorithm or a piece of software. In other cases it's a new way of viewing the market. I'm personally excited about the companies that have really strong technical differentiators. There's some of the other judges who are maybe more focused on that question of what's the go to market strategy look like. And that's partly why having a team of judges is kind of fun, because we have to reach a consensus about how these all come together with a particular company. It's a really challenging process, especially in the last few years where the quality of the entrance has gone way up. And personally, I think the reason for this is that security is one of the places where innovators have the greatest opportunities. So some of the smartest, most capable technology innovators are attracted to the opportunities and security. But that means then that the quality of the competition is just spectacularly high. There are an enormous number of brilliant people competing for these opportunities. I look at the entrance this year, if there had been 50 or 75 spots on the stage, they could have been filled with strong companies. And the whittling down to 10 was really difficult.

B (21:20)

Cecilia, can you set the stage for us here? I mean, one of the things that impresses me year after year is just both the scale and the energy of what's going on in that room.

A (21:32)

It's true. The way that we're working this year, I'm so excited about it because we're doing something different to give a little bit of fomo. We want you to be in the room, so when you get there. And I'm going to keep a little bit of this behind the curtain so that it will be a surprise, but let's just say that we're going to start to try to gamify and to make something really interesting for people who are actually in the room. So not only are you getting this high octane contest that's on the stage, super fun all the way through, and then you get to see who the winner is. That's awesome. But additionally, we're just trying to make the entire room feel that sensation of excitement all the way through from start to finish. When you walk in to when you leave. So it will be a great experience.

B (22:16)

Yeah. Like I said, I'm very much looking forward to it. If you've never been, you're in for a treat. It's. I think it's fair to say it's probably a bigger room than you're expecting it to be. And the amount of energy, particularly when that winner is announced, there's really nothing else like it.

A (22:32)

Yeah, we're gonna have 1500 seats in there, so. But get in there early because they fill up. It will definitely fill up.

B (22:39)

Paul, let me ask you one more question before we part ways here. Can you give us a little peek behind the curtain? In the years that you've been doing this, what is it like when you and your fellow judges are making that final decision?

C (22:52)

Actually, there's two parts to the decision making process. One is deciding which companies go on the stage. And that's kind of a lot like what a diligence process would look like if you were looking at a startup for any investment. Looking at the people, looking at all the information they submit. The. But behind the stage is super interesting because it's surprising to me how much opinions shift there. Seeing a company present, seeing how the CEO performs under fire, how they answer some of the hard questions. Because I come into that with a list of questions that I'm curious about each company. They're usually the hard questions that maybe the entrepreneur doesn't actually really want to be answering. Where's that weak spot? And I'll poke it. Sometimes I'm really impressed with the answer. And sometimes I'll come away thinking that I thought that was a stronger company than it really seemed when they got up there. So conversations are often one where different judges have pretty different opinions. And then generally we'll reach a consensus around one or in some years there'll be a runner up or a second winner as well. So we'll see what happens. This year. I really have no idea going on into this, which one will win, their strengths of every single one of them. And in some ways, I guess you could say they're all winners because they all have got the $5 million safe note. But the judges take this really seriously. It's a hard and a little stressful trying to make a decision there. Looking back in the past, the companies that have been on the stage and the ones that have won have done extremely well. This year is going to be hard though, because the rules are shifting. The AI dominance and the rate of speed of change in the industry means that my feeling of having kind of a sense of what the future looks like is cloudier than it's been in past years. So will I. I'm cautiously optimistic we can continue the trend of picking the strongest companies. We'll see what happens.

B (24:39)

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