Silicon Valley companies may be partly to blame for allowing Russia to exert undue influence on the U.S. presidential election, thanks to gaps in data security in a wide range of information technology products created in and around the Valley. Even President-elect Donald Trump, who some observers say benefited from Russian hacking of Democratic Party documents, said last week that “no computer is safe” and it may be better to use human couriers to deliver anything important.

So unless tech companies take more steps to ensure confidence in the security of their systems, they may see the unthinkable: shrinking IT budgets. So says Alan S. Cohen (left), chief commercial officer of the cloud-based security startup Illumio Inc. The longtime tech executive spoke to John Furrier, co-founder and co-chief executive of SiliconANGLE Media and co-host of theCUBE mobile video studio, on the latest edition of the Silicon Valley Friday Show. Cohen and Furrier also explored the rapidly shifting landscape for tech startups and giants as well as the venture capital ecosystem.

The Silicon Valley Friday Show is a weekly video and audio program broadcast live at 8 a.m. Pacific every Friday from theCUBE’s studio in Palo Alto, California. Here’s a direct link to this week’s full show:

Cohen, a frequent guest on theCUBE, is a 25-year technology veteran executive who leads Sunnyvale, California-based Illumio’s go-to-market strategy and customer engagement organizations, including marketing, support and talent. His last two companies, Airespace and Nicira, were acquired, respectively, for $450 million by Cisco Systems Inc., where he also served as an executive, and for $1.26 billion by VMware Inc.

No more free ride

Cohen laid out the evolution in computing that led to the current state of security, when huge hacking incidents and data breaches are a daily occurrence. Quoting National Security Agency chief Mike Rogers, Cohen noted that there is now a massive concentration of data in enterprise data centers and in cloud environments.

“Ten years ago, people didn’t have the computing power to get to it and extract it, and now they do,” he said. “And things like AI and everything that have advanced our industry are weaponized and the bad actors [can] get their hands on the same tools.”

So now, he contends, a shift in attitude toward security is crucial. “It used to be how do you keep bad things out,” he said. “Now for the next 20 years you know bad things are in there, it will be how do you limit the damage. The entire world’s going to need a hygiene lesson.”

Furrier noted that if Russians dropped armed forces into New York and stole money from banks, war would be declared. “Why don’t we have a digital army?” he asked.

“Actually we do,” Cohen replied. “Cyber is up right there with economic warfare and political influence as a factor in how nation-states work together,” he said. But it’s still quite unclear who’s protecting us in cyberspace. “We’re going to have to have a new social compact on this.”

Moreover, Valley tech companies will have to take a much more active role in making sure computer systems and networks are secure. “Real estate prices around here are high because of all the tech hardware and software being sold,” he said. “If there’s a lack of confidence in the security and trustworthiness of those systems, people are not likely to buy more. We as an industry have had a free ride, saying ‘Buy my systems and you’ll be more productive.’”

But he said that’s no longer a guarantee if security isn’t improved. “It is not inconceivable that that big IT pie could shrink if people have less confidence in putting in computer systems,” he said.

Changing the model

Cohen and Furrier also talked about the divergent challenges faced by the two large swaths of technology-driven businesses: media companies and enterprise and cloud computing providers. New media companies such as Twitter enabled Donald Trump to set the agenda on coverage, winning the election without spending much on traditional media. “Trump trolled his way to the presidency,” Furrier said.

“Same as companies troll their way to customers and IPOs,” said Cohen, who distinguished between the challenges faced by media and enterprise tech companies. “There are no barriers to entry in media,” he said, but for IT infrastructure companies, it’s different: “You’re not going to build a self-driving car on a million and a half dollars of your friend’s seed funding. The infrastructure world is more like World War I trench warfare and the media world is more like terrorism. You don’t get change in significant industries without trying to blow things up.”

Added Furrier: “So the startups are the new terrorists.”

“You need to go see ‘Hamilton,’” replied Cohen. “Sometimes the ‘terrorists’ become the founding fathers and write a constitution.”

More specifically, Furrier said, it’s contrarians that often win. Cohen agreed: “The more difficult and weird and crazy you and your idea are, the more interested the VCs are in you,” he said. They have to fund that way if they’re going to change things.”

In fact, VC itself has had to transform itself to keep up with those contrarians, leading to the rise of super-angels and, especially, super-funds such as Andreessen Horowitz. “If you are a portfolio company in the Andreessen Horowitz family, you’re a lucky person, because there’s help in every business function, from recruiting to meeting customers. They have created a firm around helping entrepreneurs.”

Furrier noted that in fact, Marc Andreessen and Ben Horowitz starting by pitching a small fund for early-stage investing. “Then they completely went off the reservation and invested in Skype. But Skype paid off huge. They told the limited partners one message and did the complete opposite. Talk about bomb throwers.”

Cohen said that the model certainly shift, but “they built the firm that they wish they had when they were entrepreneurs. They had to change the model.”

The need for speed

Whether it’s VCs or the startups they fund or large companies, though, one thing remains constant: the need for speed, whether it’s in the creation of new business models or catching up to them.

Nowhere is that more apparent than in Seattle, where Amazon.com Inc. essentially created the web services model a decade ago — and where Microsoft Corp. now is mounting a credible challenge by shifting its entire business toward the cloud. Amazon became the dominant cloud provider thanks to its first-mover advantage. But now Microsoft Chief Executive Satya Nadella has managed to use AWS’s dominance to rally its troops.

“Most companies don’t disrupt themselves until they’re had a near-death experience,” Cohen said. “So when I see the innovation at Microsoft, I see brilliant leadership. You have to create the crisis.”

It’s like Tom Friedman put it in his new book [“Thank You for Being Late: An Optimist’s Guide to Thriving in the Age of Accelerations”], he said. “Instead of being flat, the world is fast,” Cohen said. “The winners in any tech are fast. And some of the tech aircraft carriers have moved very fast, like Microsoft.”

To bring the point back home, the importance of speed applies specifically to security as well. Illumio, for instance, not only tries to compartmentalize workloads and applications to reduce the potential for attacks but aims to do it quickly. “If we see an anomaly, we know it in seconds,” he said. “We spent all of our money in security for the last 30 years on detection. Now you just have to assume the bad guys are in and you need to know when they’re doing something, and you need to do that fast.”

Photo by SiliconANGLE