Reporter's Notebook: Optimism Runs Wild At RSA Cybersecurity Confab

The in San Francisco has come and gone, and the main feeling from venture capitalists is one of optimism as talk of dealmaking, the IPO market and of course, AI dominated the week.

Venture capitalists are optimists by nature 鈥� one has to be optimistic (among other words) to invest millions of dollars in five or six 20-year-olds who think they can do something 肠补苍鈥檛.

That optimism was on full display at this year鈥檚 in San Francisco 鈥� where the cybersecurity gathering turned the city back to its pre-COVID days, with thousands of folks walking the streets of SoMa and packing bars and restaurants.

Hope and good vibes from VCs were almost as abundant as drinks. Deals like the giant $32 billion wedding of cloud security unicorn and parent and cyber giant 鈥� move to start the show made it seems their dreams of actual DPI 鈥� distributed to paid-in capital, or the capital paid to funds鈥� LPs after exits by those funds鈥� portfolio companies 鈥� may come true this year.

The numbers somewhat support that idea. A third through the year, 32 VC-backed cyber startups have been purchased. They include cyber risk firm and , which identifies threats in real time.

That puts it just under last year鈥檚 pace, which saw 105 cyber startups get scooped up 鈥� the best year since 2021. That, of course, included credit card giant has agreed to buy threat intelligence company from for $2.65 billion.

However, while the numbers paint an improving picture, some world events such as war, tariffs and the looming threat of a recession point toward a more uncertain future. Most investors, however, downplayed such concerns while acknowledging their existence.

鈥淟isten, we are optimists by nature,鈥� said , a general partner at investing in cyber. 鈥淏ut obviously with tariffs, international relations, there is instability.鈥�

, general partner at , a multistage global venture capital firm dedicated to cyber, said he sees the exit market picking up as well 鈥� with more unsolicited inbound calls about dealmaking happening.

Also, while the IPO market is still somewhat frozen, Palmer said his firm continues to prepare companies for when the pipeline is turned on 鈥� assuming that happens.

Nearly all investors agree the markets have not picked up in the way many hoped they would at the end of last year. Still, many believe the cybersecurity market and venture market in general are healthy when looking at both fundraising and M&A dealmaking.

鈥淐onflict and disagreement will always exist on a geopolitical level,鈥� said , co-founder and managing director at , which specializes in cybersecurity and infrastructure software investments. 鈥淏ut right now people are willing to invest and deals are happening. I don鈥檛 believe that will change as hopefully we see more stability.鈥�

Other things that caught our ear and eye:

Similar to last year, AI was the key talking point at the conference. However, investors were conflicted when it came to both 鈥渟ecurity for AI鈥� or 鈥淎I for security.鈥� Per the latter, some investors see artificial intelligence agents in places such as security operations centers significantly helping with repeatable tasks. Others see it as a tech that will easily be commoditized, with identity and fraud being main use cases.
On the other hand, security for AI seems to have a huge runway in areas such as the health and weaponization of data, but startups are few and the ones there are still young in the space. 鈥淪ecurity for AI is much more in the embryonic stage,鈥� Zilberman said.
Another interesting note was the IPO market. Investors still talked openly about some of their portfolio companies going public 鈥� but not this year. That hope that this would be the year the IPO pipeline would be re-opened seems all but dashed. VCs are realizing and still think going public is a possible exit for the cream of their portfolio 鈥� just not anytime soon.

附近上门