Q&A With Palo Alto Networks Founder Nir Zuk.

By Scott Denne

 

After a nine-month search for a new chief executive, Palo Alto Networks Inc. has hired Mark McLaughlin, who was CEO at VeriSign Inc. until he resigned last week. Palo Alto Networks builds firewall appliances that can peer into network traffic, enabling companies to place limits on how their networks connect to the Internet, and personalize how specific employees use certain applications. We sat down with Nir Zuk, the company’s founder and chief technology officer, to talk about where the company is headed and what it was looking for in a new CEO.


Here’s an edited version of the conversation:

Q. Why did it take so long to find a new CEO?

A. We were looking for specific things that are very hard to find. We wanted someone that can put the customer first. You’d be really surprised how many people don’t have a focus on the customer. We talked to many of Mark’s former customers and they all raved about him. We wanted someone with good leadership experience. Mark has that as a West Point graduate, former attack-helicopter pilot and was at several start-ups before VeriSign. Also, it’s really important to me, as a founder, that innovation continue, and not have a CEO who’s going to convert it into a sales and marketing machine. We’re talking about a guy who didn’t come from HP or IBM or one of these behemoths who destroy your passion for innovation.

Q. Why is it so important for the company to remain innovative?

A. It’s all about where you want to get to. If your goals are short-term then yes, turn up sales and marketing and flip the company in a few years. Look at the position Cisco [Systems Inc.] is in now — not just in security, but in everything. If you turn into a sales and marketing machine, your day will come. It may take five or 10 years, but your day will come. We are building a company for the long-term and we have the support of our venture capitalists in doing that.

Q. How are all the security breaches that have been in the news lately affecting how customers think about security?

A. We’ve had the same message to our customers since we started selling four years ago: Look, the competition has not done anything for you in the last 10 or 15 years. They’re selling you the same product again and again and again and again. Customers are starting to realize that and you can see it in the numbers.
Palo Alto Networks has well above $200 million in booking run-rate [meaning that its most recent quarter had more than $50 million in bookings] and over 20 customers that spent more than $1 million. We’re at an inflection point and incumbents can’t survive inflection points in the market. Look at Nokia or Sun or Silicon Graphics. Or even Microsoft, which was never able to get Internet right. Though some survive by moving to a new market like Apple did.

Q. What kind of milestones does Palo Alto Networks need to hit before it will file for an IPO?

A. “We’re thinking about it. It’s about doing what’s best for the company. It’s not tied to any particular milestones.”

Link to original article from The Wall Street Journal