On-Trend | SecondSight

One of our latest investments hails from the home of the Hoosiers, right out of Bloomington, Indiana, where the team and the concept of SecondSight were born. I know what you are thinking: great, they added AI, which must make it automatically investable. For us at Render Capital, it was more than just adding the AI moniker to the SecondSight team.

At its core, SecondSight is making one of the most complex insurance industries more readily understandable, offering a suite of software tools that help businesses uncover, understand, and manage digital risk more effectively. Cyber insurance is one of the newest and most overlooked places where businesses should maintain vigilance, compliance, and process.

SecondSight is the first telematics platform for real digital risk, empowering businesses to see and track inside-out risk in real time. Its platform is used by businesses of all sizes (including Fortune 500 companies, startups, and government agencies) and all of them benefit from a number of advantages:

• Reduced cyber risk: SecondSight’s platform helps businesses identify and mitigate digital risks before they become costly incidents.
• Improved cyber insurance coverage: The platform provides businesses with the information they need to obtain adequate cyber insurance coverage at a competitive price.
• Peace of mind: The platform gives businesses confidence that they are prepared to respond to cyber incidents effectively.

The Problem with Cyber Underwriting

Ransomware attacks occur every 11 seconds, and estimates suggest cybercrime could cost businesses globally $10.5 trillion by 2025. This problem is not going away, because the reward of a successful attack is profitable and the tools required to launch one are getting cheaper and more sophisticated. Yet the process of underwriting cyber insurance, by which an insurer evaluates the risks of insuring a particular person, property, or event and determines the policy’s terms, has not been successfully modernized. It is inconsistent and rarely takes a data-driven approach.

Current methods typically rely on outside-in assessments that identify potential network vulnerabilities but ignore vulnerabilities that reside inside the company, files, encryption settings, administrative access, databases. The process is often based on perceived promises or policies that are scripted yet unvalidated.

This is a huge problem for insurance companies. Essentially, they are pricing risks with very little internal insight into how companies manage their digital infrastructure. Because demand is increasing and insight into real exposure is low, premiums continue to rise dramatically, straining corporate budgets. Eventually, companies will need a better way to assess their risks so insurers can properly price and manage premiums.

Why Now

There are several macro trends in cybersecurity shaping the industry and driving growth in the market:

• Increase in cyber threats: Cybercriminals are increasingly using advanced tactics such as ransomware, phishing, and social engineering, driving demand for advanced cybersecurity solutions.
• Cloud adoption: As more businesses move operations to the cloud, there is a growing need for secure cloud infrastructure and cloud-based cybersecurity solutions.
• Internet of Things: The proliferation of IoT devices is driving growth in the cybersecurity market and an increased focus on securing critical infrastructure like smart cities.
• Regulations and compliance: Governments and regulatory bodies are introducing stricter regulations, driving demand for solutions that help businesses comply and protect their data.
• AI and machine learning: AI and ML are increasingly used to automate cybersecurity processes, improve threat detection and response, and enable predictive analytics so businesses can proactively mitigate risk.

Key Benefits of SecondSight

• Improved visibility into digital assets and risks: A comprehensive view of digital assets and the risks associated with them, used to identify and mitigate risks before they become costly incidents.
• More informed cyber insurance decisions: The information businesses need to obtain adequate coverage at a competitive price, including the ability to compare quotes across providers.
• Reduced cyber risk exposure: Insights that businesses can use to implement risk mitigation strategies, such as security awareness training and multi-factor authentication.
• Improved compliance: Reports that document a business’s cyber risk management program and help meet industry regulations.

A Large and Growing Market

According to a report by MarketsandMarkets, the global cybersecurity market is expected to grow from $217.6 billion in 2020 to $345.4 billion by 2025, a compound annual growth rate of 9.7%. In addition, the global cyber insurance market is expected to grow from $10.33B in 2021 to over $63B in 2029, a CAGR of 22.4%. These macro tailwinds are extremely positive and will continue to drive demand for the company’s products.

Finally, the SecondSight team is made up of rock stars. Reuben Vandeventer has deep experience in data science and multiple startups behind him. We have heard nothing but good things about his ability to take customer needs and deliver a product, and he has surrounded himself with a deep bench of experts across various fields.

For all these reasons and many more, SecondSight is worth a look for any business preparing for the cybersecurity threats of tomorrow.