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Get Ready for Hacker Summer Camp


CYBER THOUGHTS NEWSLETTER

JULY 2023


Is it hot enough for ya? Though we have readers everywhere, we believe that this joke is now universal given that its the hottest month on record pretty much everywhere. Well, almost everywhere, because cyber funding rounds are bucking the trend and are still quite cool, though up from the multi-year lows of June. We expect deal volume to pick up more in September, especially since BlackHat and DEFCON are coming up next week.


This year the big theme will be <drumroll> AI. We have gotten a sneak peak at several of the talks for BlackHat and it should come as no surprise that many of them have an AI angle to them. While there is a whole track for AI several of the talks in other tracks have an AI element to them. The idea has also been floated that a number of the more lackluster submissions to the conference were written by ChatGPT, but no one bothered to run them through the GPT detector tool so we will have to just hope that they weren’t worked on by a human who would be sad at the rejection letter.


While BlackHat is a pretty typical cybersecurity conference, with the twist that it focuses on attackers rather than defenders, DEFCON is a unique beast. Often billed as hacker summer camp, it is more like a cybersecurity-focused Lolapalooza than a tech conference. Last year, for the 30th anniversary of the convention, an estimated 27,000 hackers and tech lovers convened for a weekend in Vegas, in August. The irony of course is that hackers love to wear all black, and Vegas in August is… inhospitable outside.


Every year at the sister events, Lytical hosts a private dinner for founders, hackers, and investors, and this year is no different. We look forward to bringing you our views from the conference next month. But for now, here are a few of the articles that caught our attention this month. Moreover, we’ve inserted one or two sentences in italics, summarizing each article’s importance. We hope you enjoy and appreciate the material.

WHAT WE'RE READING

Here's a curated list of things we found interesting.


FBI: Hackers Are Having a Field Day With Open-Source AI Programs


Criminals are using AI programs for phishing schemes and to help them create malware, according to a senior FBI official.

Shocking no one, cyber-criminals are using generative AI to make more effective malware. I believe literally everyone predicted this, but it’s nice to have confirmation.




Chinese Malware Could Cut Power To U.S. Military Bases, Businesses And Homes, Report Claims


The Biden Administration believes China has installed malware on U.S. networks that could affect military operations and other domestic communications

As tensions rise between the US and China this type of article, and the underlying issue, will become more common. The US connected aging infrastructure to a global network, there are going to be problems.




Venture Firms Scale Back Megafunds in Strategy Shift

The prolonged startup bear market is forcing some venture firms to unwind investments and scale down expansion plans

Megafunds drove up prices across the startup ecosystem as they tried to invest their billions into the early stage market. With the change in market conditions those funds have had to slim down, and from our perspective that’s great news since we hope to see more rational prices going forward. Treating startups like a duck and force feeding them money doesn’t result in Fioe gras, it results in bloated spending and lower returns for investors.




TRANSACTIONS

Deals that caught our eye.


Thales Purchases Imperva from Thoma Bravo for $3.6 Billion


Thales (Euronext Paris: HO) announces today that it has reached an agreement with Thoma Bravo, a major software investment firm, for the acquisition of 100% of Imperva, a leading US-based data and application cybersecurity company, for an enterprise value of $3.6 billion.





PODCASTS

What we're listening to.

The National Committee on U.S.-China Relations promotes understanding and cooperation between the United States and Greater China in the belief that sound and productive Sino-American relations serve vital American and world interests. Want to know how the US compares to China in AI? Professor Jeffrey Ding is the person to listen to.

The U.S.-China AI Race: Where do both countries stand?

Artificial intelligence (AI) technology has the potential to revolutionize the way the world works and communicates. AI also plays an outsized role in technological competition between the United States and China, in what some call the “AI race.” What is China’s current stage in the AI race as compared to the United States, and what challenges and risks lie ahead in adopting AI technology?

Jeffrey Ding, Assistant Professor of Political Science at George Washington University, joins the National Committee to discuss U.S.-China AI competition.



ABOUT LYTICAL

Lytical Ventures is a New York City-based venture firm investing in Enterprise Intelligence, comprising cybersecurity, data analytics, and artificial intelligence. Lytical’s professionals have decades of experience in direct investing generally and in Corporate Intelligence specifically.

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