There is a monster lurking in office buildings all across the country.
And in our new, socially distanced world, the threat it poses is bigger than ever before.
But containing and securing this beast presents a massive opportunity for investors to profit.
In fact, companies working on this problem are beating the market not just by a handful of points… but by severalfold!
Rise of the Franken-Network
Most businesses have been building onto their networks for decades.
They’re now faced with this clunky, “Frankenstein’s monster” system that is made up of different, disparate pieces sewn together.
It’s not the prettiest creation. But it’s worked.
The go-to security method to protect these beasts has been the tried and true castle-and-moat approach.
Watered down, this means external threats are kept at bay by a firewall, which acts as the moat. There’s only one way in: a drawbridge, or a password challenge-response system.
To gain access to the network, a user must show credentials at this entrance. Once they show the proper ID and undergo some stern questioning by guards, they can come and go as they please.
We all cross drawbridges several times per day.
Well, hackers use these drawbridges too. They try to disguise themselves as trusted users in order to stroll past the guards. That allows them to cross the moat into the castle, or the internal network.
From there, they can go about as they please.
So it’s basically been a friendly trust-but-verify model. Because, realistically, the majority of people parading across the drawbridge aren’t up to anything nefarious.
Well, in today’s world, this concept is more out of date than ever.
The Dawn of Zero Trust
In the last few years, we’ve seen the emergence of “zero trust” security.
The idea here is elegantly simple: Everyone is a threat.
Users are given access to only what they need – nothing more – through micro-segmentation as networks are broken into small zones.
Not only does it make networks more difficult to break into, but if an unwanted individual does get in, they’re constantly asked for ID and verification.
The most common zero-trust trend is probably multifactor authentication. Your Amazon account, your brokerage account, and your Facebook, Gmail and iCloud accounts all use this. To gain access, you enter your password and then must enter a code that is sent to another device, like your smartphone.
The increasing problem today is vacant office buildings. Employees are scattered to the wind, working remotely. The castle-and-moat concept is antiquated.
Making matters worse is that nearly three-quarters of all companies intend to shift to more remote work – even after the COVID-19 threat has passed.
For security leaders, this has been a headache. In fact, 80% said their companies accelerated cloud transformation efforts this year… and they were unprepared for the overhaul.
Already, cyberattacks have experienced a meteoric rise. And it’s likely to get worse.
That’s why more than 75% of businesses say they need to shift to a zero-trust framework. And scores of companies are committing to this migration.
This is triggering a boom for cybersecurity firms like Cloudflare (NYSE: NET), Okta (Nasdaq: OKTA), SailPoint Technologies (NYSE: SAIL) and others.
And year to date, the Global X Cybersecurity ETF (Nasdaq: BUG) is outperforming the S&P 500 by more than fivefold!
All of this is why cybersecurity has been one of our favorite trends to follow, especially in 2020 and the post-quarantine world.
Remember, the projections are monstrous. But I believe they’ll be exceeded.
By 2030, it’s projected that there will be more than 125 billion devices connected to the internet. All of these will offer opportunities to ne’er-do-wells.
That means the need for protection is skyrocketing. By 2027, the global cybersecurity market is projected to be worth $326.4 billion.
The “Frankenstein’s monster” networks that are currently lurking all across the world can be saved by zero-trust security. And for investors, that can translate into a major payday.
Here’s to high returns,