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Episode 011

Netskope’s Sanjay Beri on aspiring to be an iconic company through controlled innovation

A conversation with the CEO and Co-Founder of Netskope

In 2012, Netskope CEO and Founder Sanjay Beri was convinced that the security industry was on the brink of a massive transformation. Through countless conversations with CEOs, CIOs, and CISOs, he identified a significant shift towards the cloud, presenting a unique opportunity to redefine data network security for this new era. Thus, Netskope was born, starting small but with grand ambitions.

Netskope’s early days exemplify the power of a clear vision and controlled growth. They began with specific SaaS products and steadily expanded into a comprehensive platform. Today, Netskope serves over 3,400 customers, tens of millions of users, including over 30 of the Fortune 100. In this episode, Sanjay sits down with Accel’s Eric Wolford to share insights into their steady strategy, intentional fundraising, and evolution into an industry-leading security platform. He also reflects on over a decade of leadership and people management, offering valuable lessons about team evolution as the company scales.

Conversation highlights:

00:00 – Sanjay’s background at Juniper Networks and interest in entrepreneurship

03:23 – The reasons behind Netskope’s early focus on SaaS products

04:14 – How Netskope approached fundraising with a focus on relationships and differentiation

11:00 – Netskope’s shift from products to platform

15:30 – Learnings from over a decade of leadership and people management

25:00 – A new approach to startup innovation; from product to GTM to marketing

27:10 – Why Netskope incorporated AI into their platform from the early days

35:00 – Reflections on how the ecosystem has evolved since 2012

Featured: Sanjay Beri, CEO and Co-Founder of Netskope and Eric Wolford, Partner at Accel

Learn more about Accel’s relationship with Netskope:

Explore more episodes from this season:

Access Spotlight On Season 1 episodes here.

Read More

Eric Wolford (00:11):

Hi Sanjay, thanks for coming and stopping by and joining us on Accel's Spotlight on podcast.

Sanjay Beri (00:16):

Thanks for having me, Eric.

Eric Wolford (00:18):

I've been looking forward to this chat with you. I know it's been quite a journey. So we're going to talk about the past, the present, the future. But before we do that, let's just start with what the heck is Netskope? 

Sanjay Beri (00:29):

The goal, redefine the biggest market in security data, network security, build an iconic cyber and networking company, build something that would stand the test of time.

Eric Wolford (00:38):

Let's go back to the origins. Would that be like 2012, 2013? When did you first get the idea that you wanted to start a company and you wanted to start it in this area? Talk to me about that.

Sanjay Beri (00:49):

I've always had the notion that I want to build, I want to have impact and I want to move quick. And to do that, in many cases you got to build your own company. And I had that itch probably 2010, 2011, I did it and left the bigger organization in 2012 towards the later part.

Eric Wolford (01:08):

What was the bigger organization?

Sanjay Beri (01:09):

Juniper. I was at Juniper, I was at GM over at Juniper running part of their network security business and beyond. And I realized, you know what? I want to innovate. The industry's changing. And to do that I got to start with a blank whiteboard and I want to do what I love, which is all my work to date has got me to this point. I want to drive and build a company. And I left just with that concept. That was it. 

Eric Wolford (01:34):

Then how did you come to the idea around security for software as a service? When did that idea come into view? 

Sanjay Beri (01:43):

So I love to live in the trenches and obviously live in the clouds, but trenches means, hey, you're working with CIO, CISO, CTOs, you're talking to them. And that's what I did in history. I talked to them and I realized, wait a minute, the world's moving to cloud people working remote and they're using mobile. And the whole concept of data network security, which is like $30 billion spent in boxes, it would completely change and it would change to this concept of wait a minute, protect the cloud from the cloud. But that wasn't the whole vision. The vision was to be much broader. It was to be the new processing point for all traffic internet. But I started with SaaS because frankly nobody had anything.

Eric Wolford (02:27):

Right, I see. So you weren't building a better mousetrap, you were trying to address a new problem for a new demand set. Yes. Tell me about that.

Sanjay Beri (02:37):

When you looked at SaaS, the average organization had over a thousand SaaS apps, but they didn't know they had them. They couldn't secure them. But the supplemental way to solve that problem was the same way to solve how do I govern web, how do I govern on-prem, all these broader data network security. I see what you're saying, but you're an entrepreneur, what do you do in the beginning? You don't go punch the big folks in the mouth or necessarily in enterprise, you pick your place, how do I get in? How do I insert myself into the customer?

Eric Wolford (03:10):

That's great. That's great. That's great. So let's talk about that insertion. How did you choose that insertion?

Sanjay Beri (03:16):

SaaS was at that point, 10, 11 years ago, many organizations were still saying no to cloud. You go to some large financials and they would pump on their wall and cloud last, and I'd be like, wow, that's a good motto. But I knew it was coming. And the reality is that I picked SaaS because it was the harbinger of what would happen with digital transformation. And the reality is that securing it required something very different. Nobody would do that with what they had. Nobody would take their existing product boxes and secure SaaS. And so they would very willingly say, I do need something for that. Got it. I don't have anything. And you're right, my existing tech doesn't work. And that was our insertion point.

Eric Wolford (03:59):

How hard was it to convince the initial set of investors of this opportunity?

Sanjay Beri (04:05):

So when I left with myself, the first thing was, Hey, go find some smart people who know how to build. Because when you start a company, what are they doing? They're going to build, they got to build a product. And so even before investors, it was go recruit the first core architects with that, you have a PowerPoint. I mean, I didn't have a product. There's nothing to show. It was okay, I got this team pointed at this problem. Big fish in a big pond is where I want to be. So I'll filter out a lot of VCs. They don't have the heart, they don't want to do that. That's a long moonshot for them and very clearly know what we want to build and we have some validation. And so with VCs, it was about you. It was about the problem. It was about what do I trust this person?

(04:56): Will they lead the company in the right direction? Do they know how to build and how to sell? And can they attract a great team? So really you went, I've always said, don't talk to investors and raise capital when you need it. Build a relationship way in advance. And so when I started that journey, I already knew these people because imagine walking in, you don't know me. And I go, Hey, here's my idea, here's my, I mean, oh, I dunno. It's cold, its cold, it's cold. How do I trust you? Who do I know who you are? Wow.

Eric Wolford (05:29):

So you built those relationships in advance before.

Sanjay Beri (05:31):

I built them in advance, yeah.

Eric Wolford (05:32):

And did you apply that for every round of your financing?

Sanjay Beri (05:36):

Yeah. So there's always this notion that you don't raise capital when you need it. And in my view, you don't get to know people that you want to partner with when you want to partner with them now. And so yeah, we for example, get you look at Accel and Ping. It's true. Got to know you ahead of time. It's true, right? Same thing with our earlier investors, because they're not picking you, only you're picking them, right? And just like you wouldn't want to just come in and you don't know who I am and say, okay, great, I'm going to invest in you. I wouldn't want to pick this investor if I didn't know who they are. And so I think it's a mutual get to know each other way in advance and filter and be very direct. What you're doing.

Eric Wolford (06:17):

When you were talking to initial investors, either the first, second, third round, I know people here all the time, it's very important to have a land and an expand story. Yes. How important do you think that was for you? And tell me what yours was, your land and expand story, how important was that?

Sanjay Beri (06:36):

Super important. I mean, the reality is I often told investors, Hey, this isn't going to be for the faint of heart. And they go, why are you telling me that? What are you trying to rule yourself out? And my point was, look, companies have different aspirations. Some companies want to build this widget and they want to sell their company. Others have other, our aspiration was I want to build one of the most dominant cyber and network companies in the world. And to do that, you've got to be a platform. And so the vision was always, look, we're going to have this platform with 10 different modules addressing this broader market, but we're going to start with this first. And so the expand was always bigger than the land. The land was land the customer and the brand and get a RR so you can fund the rest. But the vision was this. And so for us it was critical because what we were trying to be was the platform. And your fast forward is that's what we are and that's what it's about. But I also told investors like, Hey, if that's not what you're in for, this isn't the right thing for you. 

Eric Wolford (07:40):

Set expectations. Yeah.

Sanjay Beri (07:41):

It's a lot.

Eric Wolford (07:41):

More risky. You want to have alignment. You don't want to have misalignment when someone expects a quick return when you're going to be on that. That's a really good point, Sanjay. Yeah. So what was harder to communicate and sell the land or the expand?

Sanjay Beri (07:54):

I think the reality is the land was people understood like SaaS. Oh yeah, of course. Governing SaaS. Yeah, there's nothing out there. We get it. It's a good market. But then when you say, and by the way, the grander view in what we're building is we're going to take over what Palo Alto does, what blue coat does, what at that time, people who were totally, and by the way, yeah, we're going to obviate a lot of what folks like Cisco have. We're going to take over all these other markets that have existed for 10 to 15 years, yet need rejuvenation and change. A lot of investors would say, whoa, wait, you're going to go against them. Would their go to market muscle? Would their go-to market power with their entrenched relationships? That was harder and it was harder to do and obviously harder to convey how we're going to do it. 

Eric Wolford (08:42):

Got it. So in your situation, the land was an easier sell. It was an easier because it was a greenfield, it was something new to the industry. And so there was unserved new demand that looked like it was growing where the other was a displacement of existing demand.

Sanjay Beri (09:00):

Yes. When you think about a platform being, wow, you're taking over in security. I say there's four or five core platforms. The reality is if you're going to be a platform you're going to displace. It can't be all greenfield. And the greenfield is often nice and easy and great, but look, if you want to be an iconic company, you're going to have to displace existing spend. And that was what we knew we were going to do. But to many investors, the hill to climb go to market wise and just thinking about, wait, how are you going to do that now 10 years later of course be like, oh wow, that's great you did that. 

Eric Wolford (09:41):

Yeah, let's talk about that shift from product to platform. A lot of your initial work was on that initial product and getting traction the land and then the expand is building the platform. When you were having this vision, there was no name for this platform. No. Right. What was it called then and what did it evolve into? 

Sanjay Beri (10:02):

It's a good question. So the way I thought about when we're building it is, look, we have this grand aim over here, but we're going to start with this little module here. But everything we build it is with that larger view in mind. So don't build something that is going to be throwaway for that. So we built components that you could use. So the proxy. 

Eric Wolford (10:22):

Yeah, proxy.

Sanjay Beri (10:23):

Let's own the proxy. What does that mean? Well, when you sit down on your computer and you go to anything, internet app, there's something there looking at that traffic saying, is that good? Is that bad? What is this person trying to do? What kind of data are they trying? It's the fundamental backbone of security. And the vision was that's what will be. Now imagine walking into an investor and going, what are you doing? 

Eric Wolford (10:48):

Sounds pretty bold.

Sanjay Beri (10:50):

We're going to be the fundamental backbone of security and who are you? So you can see why you want to get to know people ahead of time, make sure you have this scoped out. 

Eric Wolford (11:03):

Anyway, and so what did the platform evolve into? What was eventually the platform? 

Sanjay Beri (11:07):

Probably not till eight years in it got a name. It was named eventually SSE or an SSE Security Service Edge. We don't make up with these names, by the way. I understand Buzzword Bingo. I understand. And what they did is they took all the various quadrants, secure web gateway, CASB, VPNs, you name it, which all were separate. And they realized, wait a minute, these are converging, consolidating into something new that was called SSE.

Eric Wolford (11:36):

And SaaS. In light of the move to cloud.

Sanjay Beri (11:38):

In light of the two most overused words in it, digital transformation. So I often say there's an equation, digital transformation equals security transformation. One of the big parts of that is, and why is it transforming cloud mobile and obviously working remote. And that really became SSE.

Eric Wolford (11:59):

And from the time that a name was applied, how has the demand from customers, has it moved in that direction? Were there more platform oriented or are they still buying individual products?

Sanjay Beri (12:13):

Yeah, it's a great question. So first of all, when you have a name on a market, you can save 10 or 15 minutes of your corporate preso when you're introducing a customer many times, because many times they walk into.

Eric Wolford (12:23):

It was a huge win.

Sanjay Beri (12:24):

Huge win. Because Mindshare people go, oh, I know what SSE is. I get it. I understand the need for it. I'm educated. Oh, that's what you are the leader in. Got it. Versus well, what we're doing is we're the new processing point for all your internet traffic. It's a proxy with DLP with. And so it makes the selling process, which is when you're building a platform and a company, the sale is over half the equation. If your company, it makes it much easier. You walk in, wow, okay, that got it. You're the leader. Okay, got it, great. So I think it helped, it accelerated people's understanding, it accelerated demand, because a lot of people do look at these as what should I be looking at in the future? And then the reality is that it's different by vertical and by geo and by size of company. You go to a large financial services organization, they're not going to be the first to adopt, in many cases new networking and security technology. You go to a mid-market IT company, or you go to a company in a region where frankly they skipped a generation, it'll be easier. And so I think people have to also realize when they go to market that look, there's going to be early adopters and you can slice 'em by geo vertical and size and then they'll be delayed.

Eric Wolford (13:48):

Did that impact how you directed your go-to-market resources? Absolutely. Did you direct them here at this stage and then here at this stage and then here at this or talk about that a lot?

Sanjay Beri (13:58):

Yeah. So first geo, we know there's some late adopting geos. So for example, you're not going to go into Germany as the first thing you do. They're going to be a little more conservative in adoption. So first focus on the geos, which tend to be things like us, parts of the us, parts of Europe, perhaps maybe go to France and the UK and Australia, parts of Latin America. So one is geo, two is size customer. We did not want to focus on small. We felt like small would not be the market, which would take best of breed security, consolidated best of breed. So we went to mid and large and large. We focused on it, focused on healthcare. We focused on certain verticals which adopt more. We still built relationships with financials, but we built them with the mid-market financials. Got it. And we got introduced to the larger ones. So we were in the mix four years later when they were ready. You know what I mean? Those are long sales cycles.

Eric Wolford (15:01):

So you didn't ignore them, but you didn't pour too much in it. You weren't going to get a return.

Sanjay Beri (15:06):

Yeah, yeah. You can't, if someone put up in our fourth year a large financial in their pipeline and said, oh yeah, by the way, that is what's going to close next quarter. I'd look at 'em and go, yeah, no, not going to happen.

Eric Wolford (15:21):

They may not be believing in the cloud. Yes.

Sanjay Beri (15:23):

And they move slower and they have a lot of entrenched functionality that they need to be careful about moving.

Eric Wolford (15:29):

It's very legitimate. Let me ask you a question about company building. You've had to go through, I'm sure, waves of company building. And as you do company building, there's your first team and then your second team. And as a nice guy from Canada. Where are you from? 

Sanjay Beri (15:48):

Yeah, Toronto.

Eric Wolford (15:49):

Toronto. Toronto. How did you deal with all of the necessary people, conflict and team development? Just talk through that process and what you had to do to develop yourself to be good at that.

Sanjay Beri (16:03):

Yeah. So first of all, big believer that in different stages of the company you have different people. And I think that's just important to understand. My background is I worked at very small and I worked at very large and I worked at mid, and I saw sort of that progression and understanding of what's needed at each phase. And so there are certain functions which for example, when I hired my head of sales, my first second head of sales, I actually told 'em, by the way, you won't be my head of sales in two years. And they looked across from me and went, that is the worst job of closing something I have ever seen.

Ever seen.

Eric Wolford (16:38):

You really fumbled that. 

Sanjay Beri (16:39):

Really. But I looked at 'em and said, you understand? And they actually went, yeah, if we grow at the rate we're growing, I get it. And so there's certain functions where you will want different people. You want hunters always as you grow, but as you grow, you want more operational, run a large scale in certain areas. RD may be a little different, but definitely in the go-to-market side and definitely in support and sales. And so company building was find amazing people who believe in what you do and are hunters, not farmers in the beginning, I don't want somebody from the big large enterprise, they're not going to know.

Eric Wolford (17:18):

That's scrappy enough.

Sanjay Beri (17:19):

Yeah, they're not scrappy enough. And so we hunted for those people who understood the market were hunters. And also probably about three years in, two years in, we flipped them and many of them stayed, but the head of sales flipped. Got it. And the previous one became somebody who worked for them. Got it. Engineering the next level of engineering scale. And the person who was running that became a manager within the engineering group. So it's just different points, different scale. You always want hunters and you always want people with high integrity and their motor. Got it. But you do need different people at different times.

Eric Wolford (17:56):

Did you find, you found anyone who, or some people who bought the vision and were in for the marathon, you know what I mean? Yes. Or that's a hard group of talent to find.

Sanjay Beri (18:07):

It's a hard thing speaking to even founders. And when you start a company, you hire your first people and you think, oh wow, they're going to be here forever. Maybe that's what you're thinking. But the reality is that as you grow and scale, you become thousands of people that may not be what for them.

Eric Wolford (18:25):

Even your own co-founders.

Sanjay Beri (18:28):

Yeah, we had four people that joined. Right. So started the company. My first person I got was my CTO. My CTO is still here today.

Eric Wolford (18:36):

He is in for the long run.

Sanjay Beri (18:38):

He's in for the long run. Christian is one of the humblest, most smart, nicest people, but he also knows what he wants. He doesn't want to manage anybody. He wants to work on an innovative project, he wants to talk to customers. And so he's very clear what he wants to do and that scales. But the third, fourth people we hired, one ran engineering. One was an architect. When we got to a certain scale was like, wait a minute, all this NPI process.

Eric Wolford (19:06):

Product.

Sanjay Beri (19:06):

Following a formal process, the quality and okay, wait a minute, I'm more the earlier stage people. And so they departed. 

Eric Wolford (19:15):

They’d self-select out?

Sanjay Beri (19:15):

Yeah, self-select out. And they still love the company. They cheer for it.

Eric Wolford (19:19):

Look back on the first five years, hardest challenge you had in the first five years.

Sanjay Beri (19:23):

So in the beginning, first thing, convince your family you're going to do what? You're going to start from nothing. Who are you doing it with? Well, I don't know yet. Well, what are you doing? Well, I'm doing this, but well, how? So the reality is my family gets me. And so they were like, look, you're not going to be happy unless you go do this. And so that's first get your family on board because that's your backbone. Second is finding the right people. In the beginning, so many people gave me big names. Hey Sanjay, that person was the CTO of that company.

Eric Wolford (19:59):

Awesome.

Sanjay Beri (20:00):

They'd be awesome. That board, you should get that board member. They were on the board of Oh, this amazing company. The second biggest challenge is resist what in your heart is not right yet. Maybe everybody else thinks is right or is in the textbook. You just don't do it. The third thing is that investor, that firm, absolute. I mean you could have them on your list, go get them, right? No. Choose your investor by the partner. Who is the person, the firm is there and they need to have staying power and they need to have, but it's the partner. And so the third is resisting that. 

Eric Wolford (20:42):

So there's a lot of resisting of some conventional wisdom.

Sanjay Beri (20:46):

Resisting conventional wisdom, listening to too many folks telling you to do stuff. In the beginning, you got to focus. You're building it. You kind know your market. 95% of what you may hear, you may want to ignore, right? And so it's true. That's difficult. I hear you later expanding the platform, everybody in the whoa, whoa. I know that's your vision, but wait, you're going to do what? We're going to go after that now. Yes, resist. Even sometimes internally, some of the folks.

Eric Wolford (21:15):

That was a big challenge for you. So in realizing the vision, you had not only critics and cynics, but you had some inertia within the company.

Sanjay Beri (21:27):

Absolutely. You're going to wait. Whoa, you're going to do what? You're going to build that you're going to hire all these people who wait, we don't know who are going to go and help us expand the product. Wait, we just, no. Right? And so you have to resist that. And you have to stay true to what you're building. And in many cases, you're right, that involves not agreeing both internal and external.

Eric Wolford (21:50):

Yeah. So I was going to ask you, did that involve changing people as a result because the resistance was too great in some sense?

Sanjay Beri (21:57):

Yeah. I think changing people, what I always tell people is if you show them why, if you show them like, well, look when he joined, this is what we are doing. Here's why. So go-to-market person. It could be metrics, financial product could be shown the market. Remember many people you join, they don't know the market. There could be an engineer, they could be. And so educate them, bring them along, given that information, many of them and go, yeah, I want to do that. But you're right, some may go, whoa, when you said faint of heart, I get it.

Eric Wolford (22:30):

I'm out. I'm faint of heart.

Sanjay Beri (22:32):

Yeah, I'm faint of heart. And so you also filter. And so yeah, that was definitely a challenge. The other one was imagine walking into your board or investors go, Hey, by the way, we're going to spend a couple hundred million to build this massive scale network.

Eric Wolford (22:50):

You're going to love it.

Sanjay Beri (22:51):

Yeah, you're going to love it. Oh yeah. Great. Well, and by the way, you'll see it in three years. Excuse me. So that's what I mean about getting the right investors who understand your long-term view. Not for a lot of VCs.

Eric Wolford (23:06):

It's a big bet.

Sanjay Beri (23:07):

That was also, as you know, it's a big bet. That was a big bet.

Eric Wolford (23:11):

Totally.

Sanjay Beri (23:11):

Yeah.

Eric Wolford (23:12):

Let's shift a little bit to a little bit more of today. Yeah. So you've built, this company has how many people now in the company?

Sanjay Beri (23:21):

About 2,700.

Eric Wolford (23:22):

2,700 people. Yeah. Okay. So big company now. Yeah. The pressure to keep innovating, is it all about scaling out or even at this stage with all the modules that you have, which is probably, I don't know, eight, 10, I don't know how many modules, but there's a lot of different modules. Do you still feel the heat and pressure to continue to innovate because of the platform strategy?

Sanjay Beri (23:46):

I'm a believer you innovate or you die in security network. It's my fundamental belief. And you've seen it. Look at all the companies that went to pe, no offense to anybody listening, but different mindset. And why did they go there? Well, they probably didn't innovate, right? And so I'm a believer in our market - innovate or die. So I have my foot on the pedal and innovating, but it is controlled innovation. We're not trying to be everything to everybody we know. 

Eric Wolford (24:14):

I see.

Sanjay Beri (24:14):

We know the platform. Don't stretch yourself too thin. Customers don't want that. But innovating in your area. Second is innovation is not just in product. It's not in finance or legal either. So don't innovate in those. But it isn't go to market too. How are you going to market if you're fighting folks who have been around for 15 years, 20 years and have 10 times the number of salespeople you have? You can't use the same tactics they have. And also, I challenge people to go look innovation. Everyone thinks a product platform. Absolutely. But it's also in the other areas. How can you be scrappy in those other areas? How can your marketing message be innovative? How can you get to these CXOs? You need to, in an innovative way.

Eric Wolford (24:56):

There's this tension that you have to innovate, but you could set your innovation surface area too broad. How did you define your own lines, your own guardrails around that's too big even for my ambitions and stay in some sort of swim lane. How do you think through that? So just tell me about that.

Sanjay Beri (25:21):

So in security, many people have a hundred different tools. And you hear sometimes I want one platform. There's a marketing message out from some people I want. In our space, I always, there's no one platform security networking, and it's not an interest to customers. They don't want to put all their eggs in one basket for all of networking and security, but they don't want a hundred. They want a few. So it's a kind of middle ground. And in my view, I look at the market and I go, oh, there's some natural partitions of platforms in our space. There's endpoint, there's identity, there's SSE, there's Simmons or and said we Argo is to own the SSE space. It is not to be the others. Got it. We will partner and integrate and I go talk to, because I talk to two CXOs a day, it's like an apple a day. I talk to two CXOs a day.

Eric Wolford (26:12):

I know you do.

Sanjay Beri (26:14):

Keeps me healthy. And it's the same thing. The customers are like Sanjay, I don't want one platform for all of that. It's going to be the best of nothing. And so it's driven by what do we feel like is right architecturally, what do we feel like customers would want and risk wise is the right thing. And then you allocate your capital to go after that and make sure that you don't go into the others. 

Eric Wolford (26:43):

On the same lines of today and looking forward, RSA happened, we'll go into more about RSA and some of the themes, but prior to RSA with chat, GPT, the AI hoo-ha exploded and it has impacted everyone all over the place either with AI for security or security for AI. And how has Netskope and how have you responded to this cloud-like effect of AI?

Sanjay Beri (27:15):

So I measured at RSA, it took about nine minutes on average in the meetings before AI was brought up. Okay, nine minutes, let's say nine out of a 45 minute meeting. Okay, great. But I tell you this, first of all, we started with AI many, many years ago, over half a decade ago. It wasn't generative AI, but it was AI for neural networks to find sensitive data and images to deck malware. And so what a lot of people have talked about now is generative AI. But the reality is a lot of in our space where the actual value is in the other forms of AI,

(27:51): I think customers start, they understand that and they understand, wow, okay, you're using it for the good of helping us stop theft and data theft and malware. Great. We love it. Keep doing that. Now, explain to us how good it is. Okay. That's one. We've always worked on that with generative AI. For us, everyone wants to know, hey, are using it in some way to help us. And it's usually to save them time, save them time from drilling through your GUI or beyond. So for us, AI has always been part of the company. I always tell my people, we had about a hundred data scientists, I had 'em for six years and nobody wants talk to them.

Eric Wolford (28:32):

Now everybody wants to.

Sanjay Beri (28:33):

Everybody does. They feel like they're the stars. And I'm like, beautiful. So anyways, that's how we think about it. And the last thing is securing the use of generative AI, just like everybody wants to use.

Eric Wolford (28:45):

Is that a demand you're receiving from customers?

Sanjay Beri (28:47):

Yeah, totally.

Eric Wolford (28:47):

So that's real demand.

Sanjay Beri (28:49):

Same thing as SaaS. How did SaaS come in, not by it, and users brought in all these SaaS apps and then it went, oh my god, we got all this SaaS. Can you help me secure it? Yep. AI was brought in, not by it, but users. And you can't say no, you got to allow people to use it, but put guardrails. And so my whole belief in our industry isn't just digital transformation and securities, it's the culture transformation. People went from a culture of no to everything. Can you generate a value? No. Can you SaaS? No. Can you work remote? No, you can't say that if you're a CIO, you got to say yes.

Eric Wolford (29:27):

That's a very good point.

Sanjay Beri (29:28):

Right? Yes. And yes. So when they come to us at RSA, what they're asking is, Sanjay, how do I say yes and got it. How do I say yes to really.

Eric Wolford (29:37):

Good points, Sanjay.

Sanjay Beri (29:37):

That and govern it.

Eric Wolford (29:39):

And have you come out with new product for that?

Sanjay Beri (29:42):

Yeah. So the same platform that governs SaaS, that granular proxy that understands the new language of the internet, API. It's the same toolkit to solve the problem of generative AI. And so yes, we can tell a customer, you could set a policy that says, yes, you can use chat GPT, but only if it's the corporate instance and only if you don't query with sensitive data, you can do that today. And so absolutely, we capitalized on that new use case, but it's the same ingredients it that we had used for the past decade.

Eric Wolford (30:16):

And I'm curious, going to drill a little bit more into this, it's a little product, but it's relevant to the current times the policy setting. How do they know how to set AI policy, an AI use policy for their employees? And do you help them or who helps them? And then what tooling do you have that enables them to implement whatever, however they articulate their policy?

Sanjay Beri (30:37):

Policy? So the first thing is we show 'em without us telling us anything. What are they using generative AI wise. So we actually show 'em a dashboard real time. You have these 14 apps you're using. Got it. And by the way, here's, there's a reveal.

Eric Wolford (30:50):

There's a little bit of a reveal.

Sanjay Beri (30:51):

Oh wow, I'm using that. Okay, great. Geez. Second Sanjay, I only want them to use a corporate version. That's what they put. They go corporate version chatGPT. You literally imagine dropdown chatGPT corporate, and then they say no sensitive data in the query. Well, two different companies sensitive data means different things. Totally. But they could, if you're a healthcare company, you can select PHI got it. You could use some of our tools to index all of your personal medical records. And so we try to make the policy in the way that the business leader thinks. Got it. Versus the old world, which was wait, what ip what you were out? Okay, good luck. You're done. And so the policy has to be easy. It has to be in the language they think. And under the hood, we map out how do I detect what's a corporate instance or not? How do I know what that's barred or how do I know if that's that's our job? Got it. 

Eric Wolford (31:49):

Other themes from RSA that impacted you or struck you right now? So we're into the current day and age, you're looking to the future. What are things that either coming from CISOs or companies or the industry itself where, oh, there's some momentum and interest.

Sanjay Beri (32:06):

So everyone goes straight to the technical. Technically, there was generative AI talk, there was consolidate platform discussion and there was sensitivity of data Everyone wants to talk about. There's more data created in the last two years than a history of time. They all want to talk about how do I find and protect it? Absolutely. Those are the big conversation. But the other one was, Hey, how do you save me money? In today's world, when you go to your CIO, your CFO, they're going to come to you and say, look, I want you to save us money. I want you to move us forward, but you need to consolidate and save money somehow. And so the business value of how do I move and modernize, how do I solve these big problems, but how do I do it in a way which also frankly is cheaper? That's a topic at RSA that you wouldn't necessarily hear four years ago.

Eric Wolford (32:58):

Oh, wow. Okay. Normally it was just you'd pay whatever to get the security. You're saying there's now a spend governor.

Sanjay Beri (33:07):

There's a, look, I had these eight different things, and by the way, I'm renewing them every year. I see. And they're actually not helping me move forward. And so there's a quote, don't throw more bad money after bad money. So bad money is that existing equipment you have that jacked up their renewal 10% and geez, I should just keep renewing it. Right? I see good money is wait, let me move to something that is in our case more zero trust more helps me move forward and consolidates those seven old things that's going to save me money and reduce my risk.

Eric Wolford (33:43):

Going back to one of the first things you said, it sounds like you're talking some specifics to that magical word of transformation, security transformation. Instead of it just being a fanciful idea, it's actually becoming more real because we've built up things and there's a lot of debt that has to be reconsidered in light of the threat surface area and the various dimensions of attackers. There's a need for security transformation.

Sanjay Beri (34:10):

Yeah, there is. I think if you asked me when we started the company, nobody was saying, my north star is what we do today. SSE. They're like nine out of 10. CISOs said, you're crazy. Everybody knows if you're an entrepreneur, you're going to get a lot of that in the beginning. Now you'll walk into the most stodgy financial. And they go, my north star is this. SSE, sassy.

Eric Wolford (34:36):

It's a totally reconceiving.

Sanjay Beri (34:38):

They've realized because the pandemic accelerated remote work, cloud obviously accelerating everywhere. And then the notion that wait a minute, the attackers, they don't sit still either. And so if we do and we sit with our current architecture, we're fertile grounds for an attack. And so I think people have realized, this is my north star now. So they're moving to it.

Eric Wolford (34:59):

As you are working with your customers, do you see changes in their organizations? What I mean big changes. So tell me about that.

Sanjay Beri (35:07):

In large organizations or mid, you had networking and you had security, and they roll up to a CIO usually. And then that goes into maybe a CFO, chief Risk Officer, A CEO, to be blunt, in many organizations, security, networking. They can't sit on a couch like we are.

Eric Wolford (35:26):

I see.

Sanjay Beri (35:27):

See, they don't like each other. 

Eric Wolford (35:29):

There's some tension.

Sanjay Beri (35:29):

There's tension. They don't like each other. I viewed it progress when I could get some of them in the same room. And when I did they on opposite ends. I see. I said, it's still progress. So you have some real in enterprise, everybody knows half of selling an enterprise is managing the politics. And when you have two groups who don't necessarily like each other and yet you are transforming both, you kind of got to sell to both. And so organizationally, what's been happening in companies, they have been trying to bring these two groups together to play well, to integrate the more, because I think they too realize that, wait, we need a unified strategy across these two security networking groups. And the CIO is often the person who has to do that. And so that organizational changes is happening. 

Eric Wolford (36:21):

The classic, what keeps you up at night? You're a founder, CEO, big company, successful company, lots to be proud of. But I know your ambitions are even bigger and greater. But what is it that even though you've had this success, there's no rest for the weary, right? You're here. Yeah, totally. What keeps you up at night? And then second will be what keeps you motivated?

Sanjay Beri (36:46):

First of all, if you're a founder, you need to know, you need to have a high tolerance for pain. And everybody knows maybe your company looks like up and to the right. When you look away, everybody knows inside your company, it's a jagged lineup. Totally. Right? Totally. You all empathize with that. You got your good days, you got your bad days, you do good things, you make mistakes, right? And so that's normal. You got to have a high tolerance for that and you, so that's not what keeps me up at night. I understand how it should work. What keeps me up at night is we always need to be hungry. We always need to be, we have to have the attitude that nobody is going to give us anything. We got to go take it. And so what would keep me up at night is when I think, wait a minute, that group or that person, or maybe some geography, culture isn't that at this stage.

Sanjay Beri (37:35):

And we got to change that. It comes down to that. You got to want it. You want to go after it. So that is what really, if we don't have that, that's what bugs me. And that's what would keep me going, okay, I got to go fix that. I got to wake up and we got to go fix that. We can't have that, right? Absolutely can't. What keeps me motivated? Look, I love what I do. I feel like it has many ingredients. It has impact. And we protect hospitals. We protect financial institutions. We protect retailers from probably the most sadistic people out there. I mean, I was in New York sitting with the Seattle Hospital, they couldn't even perform any surgeries because their whole infrastructure is down because of an attack. And so what we do has impact, and it has impact on our people.

(38:21):

We have people who I've known and got to know over eight, 10 years, we could transform a generation of their family by building what we're doing at Netskope. Put 'em on a whole different footing that is motivating. Three is, look, I want to build something that is a professional legacy and I want to build it as net scope as the company. And we're just in the early innings of the world and what you call a digital transformation. And so I'm excited about what's to come as, Hey, what are we going to innovate further on? So it's all of those building the people, the families, the impact in the world and what's to come in my view is the best. 

Eric Wolford (38:59):

That's pretty good, dude. After this long, it's great to hear you still have that same fire in the valley.

Sanjay Beri (39:06):

Yeah. And I'll give a little to you Accel folks like yourself, we get to work with you. I mean, very enjoyable. We picked our board and our investors very carefully, and we picked them so that they work well together. They're collaborative. They got that view. And it's one of the biggest things an entrepreneur can do is pick the right people. And so also motivates me is I love the people.

Eric Wolford (39:26):

In reflecting on your experience, I got a lot of potential entrepreneurs watching this or people who are young entrepreneurs, or you're 10 years in, would you do it again? Would you go back and start at day one and repeat this?

Sanjay Beri (39:39):

I would. And by the way, I've learned a lot of things, so I might do a few things a little differently.

Eric Wolford (39:47):

I'm sure people would love to hear that. 

Sanjay Beri (39:49):

You would love to hear all those things too. But we don't have enough time. But no, absolutely. Because got that fire in their belly and you want to change the industry and innovate, and maybe you're an entrepreneur and you probably could be an entrepreneur. They're like, I come in and I try to move the needle. There's too much bureaucracy of politics. Or they don't get it. Or they move too quick or too slow, sorry. Or they have a cash cow and you're probably all of that is your mind and you're like, I want to go do this. Cool.

Eric Wolford (40:17):

Right. I'm glad you did it and I'm glad you picked Accel to work with. So thank you very much. Thank you. I appreciate you doing this. 

Sanjay Beri (40:23):

Thanks Eric.

Meet your host

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Cloud/SaaS, Security

Eric Wolford

Eric Wolford is a Partner at Accel, a venture capital firm. He focuses on investments in enterprise infrastructure companies.
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