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2020 was a record year for Israel’s security startup ecosystem

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From COVID-19’s curve to election polls, public temperature checks to stimulus checks, 2020 was dominated by numbers — the guiding compass of any self-respecting venture capital investor.

As a VC exclusively focused on investments in Israeli cybersecurity, the numbers that guide us have become some of the most interesting to watch over the course of the past year.

The start of a new year presents the perfect opportunity to reflect on the annual performance of Israel’s cybersecurity ecosystem and prepare for what the next twelve months of innovation will bring. With the global cybersecurity market outperforming this year’s panic-stricken expectations, we carefully combed through the figures to see how Israel’s market, its strongest performer, compared — and predict what it has in store.

The cybersecurity market continues to draw the confidence of investors, who appear to recognize its heightened importance during times of crisis.

The “cyber nation” not only remained strong throughout the pandemic, but even saw a rise in fundraising, especially around application and cloud security, following the emergence of remote workflow security gaps brought on by social distancing. Encouraged by this, investors have demonstrated committed enthusiasm to its growth and M&A landscape.

Emboldened by the sector’s overall strength and new opportunities, today’s Israeli visionaries are developing stronger convictions to build larger companies; many of them, already successful entrepreneurs, are making their own bets in the industry as serial entrepreneurs and angel investors.

The numbers also reveal how investors are increasingly concentrating their funds on larger seed rounds for serial entrepreneurs and the foremost industry trends. More than $2.75 billion was poured into the industry this year to back companies across all stages, a 97% increase from last year’s $1.39 billion. If its long-term slope is any indication, we can only expect it to continue to grow.

However, though they clearly indicate progress, the numbers still make the need for a demographic reset clear. Like the rest of the industry, Israel’s cybersecurity ecosystem must adapt to the pace of change set out by this year’s social movements, and the time has long passed for true diversity and gender representation in cybersecurity leadership.

Seed rounds reveal fascinating shifts

As the market’s biggest leaders garner experience and expertise, the bar for entry to Israel’s cybersecurity startup ecosystem has gradually risen over the years. However, this did not appear to impact this year’s entrepreneurial breakthroughs. 58% of Israel’s newly founded cybersecurity companies received seed rounds this year, totaling 64 seeded companies in 2020 compared with last year’s 61. The total number of newly founded companies increased by 5%, reversing last year’s downward trend.

The amount invested at seed hit an all-time high as average deal size in 2020 increased by 11%, amounting to an average of $5.2 million per deal. This continues an upward trend in average seed rounds, which have surged over the last four years due to sizable year-on-year increases. It also provides further support for a shift toward higher caliber seed rounds with a strategically focused and “all-in” approach. In other words, founders that meet the new bar for entry are raising bigger rounds for more ambitious visions.

YL ventures seed trends 2020

Image Credits: YL Ventures

Where is the money going?

2020 proved an exceptional year for application security and cloud security startups. Perhaps the runaway successes of Snyk and Checkmarx left strong impressions. This year saw an explosive 140% increase in application security company seed investments (such as Enso Security, build.security and CloudEssence), as well as a whopping 200% increase in cloud security seed investments (like Solvo and DoControl), from last year.

Lyron Foster is a Hawaii based African American Musician, Author, Actor, Blogger, Filmmaker, Philanthropist and Multinational Serial Tech Entrepreneur.

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Apple’s App Tracking Transparency feature will be enabled by default and arrive in ‘early spring’ on iOS

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Apple has shared a few more details about its much-discussed privacy changes in iOS 14. The company first announced at WWDC in June that app developers would have to ask users for permission in order to track and share their IDFA identifier for cross-property ad targeting purposes. While iOS 14 launched in the fall, Apple delayed the tracking restrictions until 2021, saying it wanted to give developers more time to make the necessary changes.

Now we’ve got a slightly-more-specific timeline. The plan is to launch these changes in early spring, with a version of the feature coming in the next iOS 14 beta release.

This is how Apple describes the new system: “Under Settings, users will be able to see which apps have requested permission to track, and make changes as they see fit. This requirement will roll out broadly in early spring with an upcoming release of iOS 14, iPadOS 14, and tvOS 14, and has already garnered support from privacy advocates around the world.”

And here are the basics of what you need to know:

  • The App Tracking Transparency feature moves from the old method where you had to opt-out of sharing your Identifier for Advertisers (IDFA) to an opt-in model. This means that every app will have to ask you up front whether it is ok for them to share your IDFA with third parties including networks or data brokers.
  • The feature’s most prominent evidence is a notification on launch of a new app that will explain what the tracker will be used for and ask you to opt-in to it.
  • You can now toggle IDFA sharing on a by-app basis at any time, where previously it was a single toggle. If you turn off the “Allow apps to request to track” setting altogether no apps can even ask you to use tracking.
  • Apple will enforce this for all third-party data sources including data sharing agreements, but of course platforms can still use first party data for advertising as per their terms of service.
  • Apple expects developers to understand whether APIs or SDKs that they use in their apps are serving user data up to brokers or other networks and to enable the notification if so.
  • Apple will abide by the rules for its own apps as well and will present the dialog and follow the ‘allow apps to request’ toggle if its apps use tracking (most do not at this point).
  • One important note here is that the Personalized Ads toggle is a separate setting that specifically allows or does not allow Apple itself to use its own first party data to serve you ads. So that is an additional layer of opt-out that affects Apple data only.

Apple is also increasing the capabilities of its Ad attribution API, allowing for better click measurement, measurement of video conversions and also — and this is a big one for some cases, app-to-web conversions.

This news comes on Data Privacy Day, with CEO Tim Cook speaking on the issue this morning at the Computers, Privacy and Data Protection conference in Brussels. The company is also sharing a new report showing that the average app has six third-party trackers.

While this seems like a welcome change from a privacy perspective, it’s drawn some criticism from the ad industry, with Facebook launching a PR campaign emphasizing the impact on small businesses, while also pointing to the change as “one of the more significant advertising headwinds” that it could face this year. Apple’s stance is that this provides a user-centric data privacy approach, rather than an advertiser-centric one.

 

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Elon Musk says Tesla Semi is ready for production, but limited by battery cell output

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Tesla CEO Elon Musk said on the company’s 2020 Q4 earnings call that all engineering work is now complete on the Tesla Semi, the freight-hauling semi truck that the company is building with an all-electric powertrain. The company expects to begin deliveries of Tesla Semi this year, the company said in its Q4 earnings release, and Musk said the only thing limiting their ability to produce them now is the availability of battery cells.

“The main reason we have not accelerated new products – like for example Tesla Semi – is that we simply don’t have enough cells for it,” Musk said. “If we were to make the Semi right now, and we could easily go into production with the Semi right now, but we would not have enough cells for it.”

Musk added that the company does expect to have sufficient cell volume to meet its needs once it goes into production on its 4680 battery pack, which is a new custom cell design it created with a so-called ‘tables’ design that allows for greater energy density and therefore range.

“A Semi would use typically five times the number of cells that a car would use, but it would not sell for five times what a car would sell for, so it kind of would not make sense for us to do the Semi right now,” Musk said. “But it will absolutely make sense for us to do it as soon as we can address the cell production constraint.”

That constraint points to the same conclusion for the possibility of Tesla developing a van, Musk added, and the lifting of the constraint will likewise make it possible for Tesla to pursue the development of that category of vehicle, he said.

Tesla has big plans for “exponentially” ramping cell production, with a goal of having production capacity infrastructure in place for a Toal of 200 gigawatt hours per year by 2022, and a target of being able to actually produce around 40% of that by that year (with future process improvements generating additional gigawatt hours of cell capacity  in gradual improvements thereafter).

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Pro-Trump Twitter figure arrested for spreading vote-by-text disinformation in 2016

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The man behind a once-influential pro-Trump account is facing charges of election interference for allegedly disseminating voting disinformation on Twitter in 2016.

Federal prosecutors allege that Douglass Mackey, who used the name “Ricky Vaughn” on Twitter, encouraged people to cast their ballot via text or on social media, effectively tricking others into throwing away those votes.

According to the Justice Department, 4,900 unique phone numbers texted a phone number Mackey promoted in order to “vote by text.” BuzzFeed reported the vote-by-text scam at the time, noting that many of the images were photoshopped to look like official graphics from Hillary Clinton’s presidential campaign.

Some of those images appeared to specifically target Black and Spanish-speaking Clinton supporters, a motive that tracks with the account’s track record of white supremacist and anti-Semitic content. The account was suspended in November 2016.

At the time, the mysterious account quickly gained traction in the political disinformation ecosystem. HuffPost revealed that the account was run by Mackey, the son of a lobbyist, two years later.

“… His talent for blending far-right propaganda with conservative messages on Twitter made him a key disseminator of extremist views to Republican voters and a central figure in the alt-right’ white supremacist movement that attached itself to Trump’s coattails,” HuffPost’s Luke O’Brien reported.

Mackey, a West Palm Beach resident, was taken into custody Wednesday in Florida.

“There is no place in public discourse for lies and misinformation to defraud citizens of their right to vote,” Acting U.S. Attorney for the Eastern District of New York Seth D. DuCharme said.

“With Mackey’s arrest, we serve notice that those who would subvert the democratic process in this manner cannot rely on the cloak of Internet anonymity to evade responsibility for their crimes.”

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