Finding opportunity in a world of hacktivists

When the trash started piling up, it didn’t take long for some enterprising person to realize he could make a buck off collecting it and putting it somewhere else. Over the years, that process has evolved, but the basics never really changed too much.

Kirk Chewning of Cane Bay Partners on the Upcoming Opportunity

Back in the 60s, a Tennessean by the name of Dempster had an idea. Now you see that idea everywhere. The Dempster Dumpster provided an immediate solution to a massive problem – “what do we do with this stuff we don’t want?” Dempster literally parlayed someone else’s trash into his fortune.The lesson? Someone can always benefit from taking care of the stuff other people don’t want to touch. Or can’t figure out how to fix. If you can look at something that stinks and smell opportunity, you will never have to struggle for inspiration.

Recently, CNN reported on a “red hot” IPO. The company went public and shares surged nearly 90%. No, not Alibaba. They were talking about CyberArk. How is it that this company fared so well when others on the NASDAQ were wilting on the vine?

Hacking. CyberArk develops programs that purport to protect companies from malicious cyber attacks. According to CNN, the company is so proud of their product they promise to even protect against hacktivists and government sponsored industrial espionage.

Unless you have been living on the moon, hacking is a major issue, both for major retailers and for consumers. Jimmy John’s is just the latest victim of a tech breach in a growing group of major retailers that includes Target, Chase, and Home Depot. And these are just the security breaches we know about. CyberArk protects their customers’ privileged accounts, and, by extension, protects their customers’ customers. Every time another successful hack makes the news, the company’s sales skyrocket. They jumped 30% in 2012 and 40% last year. They have already grown 33% this year.

CyberArk is a perfect example of a company that understands both innovation and vulnerability. For every advance we make, there are vulnerabilities. Many companies don’t want to have to think about these things, and they are willing to pay dearly for the privilege of innocence. When many stood flat footed and hoped it would never happen to them, CyberArk, like Dempster, looked at the negative and saw opportunity.

Kirk Chewning is a Financial Expert from Cane Bay Partners.