Arora bats for flexibility in understanding how cloud companies work and deploy cloud-based solutions in India’s national infrastructure.

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With digital transformation and adoption ruling the top agenda for businesses globally post-pandemic, security risks have taken center stage. To address some of the cybersecurity concerns worldwide and a range of other economic issues stifling economies globally, CNBC-TV18 Managing Editor Shereen Bhan caught up with Chairman and CEO of Palo Alto Networks in a candid chat.

In the conversation, Nikesh Arora decoded key challenges that an imminent recession could pose against mitigating cybersecurity risks, financial implications of the current economic scenario on company balance sheets, the depth of entrepreneurship in India, and the opportunities that lie ahead for Palo Alto Networks.

Arora said becoming a technology-reliant society means cybersecurity is among the biggest risks that one brings to the business, and it comes with its own set of cracks that need fixing. He doesn’t think businesses will reprioritize technology adoption, which includes cybersecurity.

“If the shock to the system is large and sustained enough, we will see trimming on the edges, and that trimming will impact a part of your spend, be it technology or cybersecurity,” said Arora.

He believes we are seeing a rereading of valuation in the market across the board, and we are back to a scenario where people have to manage risk and execution, which sets values to a certain phase now.

If you're lucky enough to have arbitraged that opportunity, save a lot of money, and take care of your balance sheet for a rainy day, you're in a good state. If not, all you've done is you had a very big meal, which has led to indigestion, said Arora.

While bullish on India's entrepreneurship opportunities, Arora thinks the country hasn’t seen the cycles yet. A cycle is when you enter a new exit, we see a lot of investment and a lot of markups, but India hasn’t seen a lot of exits. All exits are either strategic buyers buying assets or a few ideas. And there are still a lot more unicorns that have to go into that cycle.

The former Softbank chief thinks many of the Indian unicorns are robust businesses; they can survive the downturn or the cold winter, of the next few years, where they either have to raise money at a lower valuation than they did last time. Going forward, people will have a healthy requirement to concentrate on profits and cash flows.

For his window of opportunity for Palo Alto Networks, Arora said customers want somebody to provide a much more comprehensive platform with a first-solution perspective which the company has done for the last four years, and now the opportunity has expanded. “Light has been shown on cybersecurity given the technological reliance and the acceleration we have seen in the pandemic.”

Arora said securing new network architecture is the hottest thing today because every company is going through a cloud transformation. It requires you to secure the new way. Palo Alto Networks is one of the few companies with this capability.

He is very impressed with the technological evolution that India is doing in the last few years; especially with some of the work that's going on in the financial services sectors being world-class; the way infrastructure has been built, the way a variety of startups have been fostered and the fact that they are all very aware they have to build this in a robust and secure way.

He believes that if we can get more and more cloud-aware, it can leapfrog the technological revolution in a way where we are actually a cloud-first country, it also requires the regulators to be more progressive from a cloud-thinking perspective, but if we can do that, I don’t think there is stopping us.

According to Arora, the deterrent in cloud adoption is that across the world, there is a degree of apprehension in letting all the data sit in the cloud. This is because cloud companies are primarily foreign businesses; many national data requirements insist you put all the data together in one place, one country.

He bats for flexibility in understanding how cloud companies work and in being comfortable in deploying cloud-based solutions in our national infrastructure. India can leapfrog if we build understanding capabilities.

From a development perspective, Arora sees a huge opportunity for securing the country’s infrastructure and the infrastructure for thousands of businesses. “We want innovation to happen in India and want that innovation to be delivered globally and to the domestic market.”

This is a Partnered Post

First Published:Nov 28, 2022 11:43 AM IST