Public Entrepreneur Issue 4 • 2018

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ISSUE 4

PE contents 2018

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COMPANY PROFILES 12

Gabriella’s Kitchen Healthy foods and cannabis-infused products take wellness to a whole new level

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Permex Petroleum Positioned for growth in the world’s hottest oil and gas region

COMPANY INTERVIEWS

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PUBLISHER

Letter from the Editor

FEATURE STORY 8 The CSE Year in Review

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®

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Peekaboo Beans Vancouver-based childrenswear maker aims to create clothing that’s both practical and profitable

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NameSilo Technologies Achieving superior investment returns requires looking where others do not

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VirtualArmour International Keeping the bad guys at bay with customized network security solutions

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Nerds On Site Clever solution for small business computing needs drives fast growth in highly fractured market

GROUP PUBLISHER Terry Tremaine terryttremaine@gmail.com

EDITOR IN CHIEF James Black

GRAPHIC DESIGN Vanessa Fryer

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sense is that some of the profits from trading in the cannabis space over the last couple of years are being applied to the mining sector.”

Tech listings have been increasing as well, even though appetite for everything blockchain has slowed compared to the enthusiasm of late 2017. Interestingly, the industry enthusiasm for cannabis might just dovetail with ongoing international outreach initiatives by the CSE to put new funding alternatives on the table in the tech space.

Smaller companies in the US and other international markets are finding it increasingly difficult to obtain private funding as private equity funds increase in size and need to make larger investments in portfolio components. A primary Canadian listing on the CSE would be worth considering for many young growth companies.

“We are being exposed to advisors in the United States who are beginning to understand that the Canadian public equity markets are in fact a viable alternative for US companies looking for growth capital,” says Carleton. “We’ve had conversations with a number of these professionals about taking what we have learned from the capitalization efforts in the US cannabis space and applying that to companies from other sectors that perhaps have not been that well served by the venture capital and provide equity models that are the principal source of growth capital for early stage US companies.”

Speaking of tech, the CSE has an ongoing project of its own in the form of a blockchain-enabled clearing and settlement facility.

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The project team is in the late stages of quality assurance and plans call for moving to external testing with dealers and other interested parties before the end of 2018.

“Dealers continue to be extremely eager to get their hands on it,” Carleton explains. “They understand the business case and the client service benefits, as well as the number of companies that would like to use security tokens as a means of securing capital. We continue to be very excited about this facility and it is going to be one of the things on the agenda for 2019.”

Continually working to improve the issuer experience is an important part of the CSE’s culture, and that’s reflected in exchange staff organizing or participating in over 80 events during 2018.

The CSE seeks to make that part of its business even stronger in 2019 with relocation to a new office, the highest office floor in Toronto, no less—72 stories up at First Canadian Place. “This was really brought on by the anticipated growth in our staffing levels, particularly in the listings regulation area,” says Carleton. “It is important that we continue to maintain high service levels for our issuers and deploy our regulatory responsibilities as an exchange.”

A full-blown market opening centre is in the works and it will be just one of several first-day activities designed to ensure that a new issuer’s launch into the public markets gets off to a good start.

“The new First Canadian Place location will provide the space and

a spectacular backdrop to have exactly that kind of experience.”

New issuers will be pleased to learn that they are joining an exchange that again set full-year records for trading volume, trading value, and other measures of investor participation.

In the first 11 months of the year, trading volume was already 54.97% higher than the total for all of 2017, topping 27.05 billion shares. Most measures of investor activity had actually surpassed last year’s record levels by mid-summer. And with the listing application pipeline exceptionally healthy as we head into year-end, look for 2019 to be another blockbuster.

Granted, capital markets in Canada are having a better year in general, but the CSE’s pace of growth in 2018 is validation of a business model that puts the needs of issuers first. Fund managers from around the world confirm this, sophisticated management teams who choose the CSE over multiple alternatives confirm this, and investors trading tens of millions of shares per day in individual companies confirm this.

Carleton and his team see it first-hand and fully anticipate 2019 to be another year of growth and progress in many forms. Be it cannabis and tech businesses listing from the US, Israeli companies following up on the CSE’s multiyear effort there to introduce the listing concept, or new investors learning about the many opportunities presented by CSE issuers, the outlook could hardly be brighter.

“Things are going well but we need to keep our foot on the accelerator,” Carleton concludes. “Top-quality service for our issuers, a fair and well-regulated trading environment, and continued innovation in the exchange’s technology and business practices. It has worked so far, and we are going to keep at it.”

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We are seeing the most rapid expansion of market capitalization and impact on the exchange since our inception.

RICHARD CARLETON

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By Katie Lewis

Gabriella’s

KITCHEN

Healthy foods and cannabis-infused products take wellness to a whole new level

W

hen you first meet Margot Micallef, chief executive officer and co-founder of Gabriella’s Kitchen (CSE:GABY), her authenticity shines through: her firm handshake, her warm smile and her clear words.

It shines through particularly strongly when she talks about her sister: Gabriella, the namesake of Gabriella’s Kitchen. Although Gabriella passed away after a battle with cancer, she remains the company’s inspiration.

The pure-play cannabis wellness company has come a long way since creating its original award-winning skinnypasta, a high-protein, low-calorie and low-carbohydrate fresh pasta. Other product lines have been added to the shelf: noodi, gabbypasta and most recently alto, which includes the company’s cannabis-infused products. Today, the vertically integrated, branded, consumer products company focuses on utilizing cannabis for the lifestyle consumer.

Not to mention the benefit of having Micallef at the helm. Her resume is impressive, to say the least: a lawyer and philanthropist, founder of Oliver Capital Partners and a former Senior VP at Shaw Communications.

Public Entrepreneur spoke to Micallef about Gabriella’s Kitchen’s origins, its new line of cannabis products and global expansion plans, and how the company is seeking to change the conversation around cannabis health and wellness products.

Q. Can you give us some background about how Gabriella’s Kitchen started?

My sister, Gabriella, and I decided to move to a healthier lifestyle and identified a derth of products in the market, primarily around food, that supported a healthy lifestyle. We saw the business opportunity. As we were launching our business, my sister was diagnosed with stage IV lung cancer.

The diagnosis really brought home the need to change our lifestyle and focus on our health and well-being that was within our control. Her doctors couldn’t do anything for her and they told her that. The pasta line was inspired by the dietary restrictions Gabriella faced throughout her cancer journey.

The beauty of what we did was that we were able to prolong her life for five years. She had great quality of life and really learned to value the foundation of health and wellness through diet and lifestyle.

Q. I don’t think many people realize the effort it takes to get a product on the shelf. Can you walk us through it?

It’s tough. In order to get your product on the shelf you have to dislodge somebody else’s product. That’s something most people don’t understand. We knew going in we were going to make amazing products, that there was a demand 2018 • PUBLICENTREPRENEUR | 13

for these products and we were going to get them to market. But it’s a lot more work and a lot more money and takes a lot longer than anybody thinks it’s going to.

We started it in a little retail location in Toronto—we moved to Toronto from Calgary because that was the biggest market in Canada. We’d make the product in the back and sell it out the front.

At 3:00 pm each day, Gabriella would close up and go pound the pavement—and slowly and surely, we got more retailers. We got up to around 200 when she passed away in 2011. I ended up taking over the business in 2015. I’ve invested about $5 million and raised another $19 million to date.

Q. What have you used the funds for and walk us through how you leverage the infrastructure you have in place?

We’ve used that money primarily for product development and to build out our team and infrastructure.

That’s our differentiator. With our strong infrastructure, we can move into any channel we want to, including the licensed cannabis channel. We came upon the cannabis space about a year ago when we examined the healthful properties of cannabis.

In many ways, our approach was opposite that of many other companies, which have an idea, raise the money and then build the infrastructure. We already have the infrastructure and the team with the knowhow to get the product on our shelf. Our existing business line has more than 30 unique products that cater to health-conscious consumers, whether they shop in the mainstream shopping channels or in the licensed cannabis retail channels.

Leveraging our existing infrastructure means we can move product into a channel much more rapidly than anyone else can.

Q: Talk about the cannabis space and what kind of consumers you’re looking for.

Our goal is to serve consumers wherever, however, and whenever they want to consume cannabis wellness products—and that means in the mainstream channel or in the licensed cannabis retail channel.

We’re looking at a diverse range of products as vehicles to assist them in their chosen modality for consumption. We already know 14 | PUBLICENTREPRENEUR • Issue 4

that the mainstream market is going to start carrying CBD-infused products in a big way. I believe that once federal legislation in the US changes, there will start to be a move afoot to get all cannabis infused products into mainstream channels. We will be ready for that opportunity.

Consumers are changing their perspective on health and are looking for new ways to supplement or replace traditional medicine.

Q. Can you talk about how your team continues to be built out?

We’ve got a whole research and development department. One to note is Mara Gordon, who is a pioneer in the cannabis space and our chief research officer. She has amassed a database of formulations and health attributes associated with the cannabis plant that she has garnered from her own experience in working with physicians, clinicians, researchers and patients over the last 10 years.

We also continue to build out our expertise in the cannabis channel, having just hired a VP sales-licensed channel and acquired Sonoma Pacific, a licensed cannabis distribution company in California.

We also have a business development team that is scouring North America for brands that we want to bring under our umbrella. We want to grow through acquisition as well as through innovation.

Q. What does your next year or two look like?

We want to be the category leader in the cannabis wellness space.

Not “one of ” the leaders, rather, “the” leader. We know that the category leader takes 70% of the economics off the table. We want to be the one that everybody else wants to chase.

We want to do that for two reasons. One is that we believe that when the federal landscape changes in the US and the big players move into the market, we think that they will look for acquisitions that will move the dial for them.

We believe that if we can build a significant platform in North America that we can then partner with a global player and benefit consumers in a much broader way and, of course, benefit our investors.

By Peter Murray

PERMEX PETROLEUM Positioned for growth in the world’s hottest oil and gas region

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s we close in on the final month of 2018, global oil prices have gone topsy-turvy, with predictions of $100 oil just a few weeks ago giving way to concern that the recent 25%+ drop to below $55 per barrel (for benchmark West Texas Intermediate) could grow even steeper.

In an environment with this level of volatility, junior oil and gas companies need quality assets, good financial structure and adequate funding, not to mention a reasonable degree of managerial flexibility.

These characteristics sum up Permex Petroleum’s (CSE:OIL) approach to operating successfully in today’s oil market.

Originally founded in 2013 and then restructured into a corporation in 2017 by President and Chief Executive Officer Mehran Ehsan, Permex operates primarily in the Permian Basin of Texas, which Ehsan calls one of the best environments in the oil and gas industry. The properties, projects and formations in this area are so popular that a new word has been added to industry vocabulary: ‘Permania.’

All the excitement is justified, mind you, as Ehsan explains in compelling fashion.

“Even when a downcycle occurs, the Permian continues to move forward,” says Ehsan. “The region produces over 3.3 mil20182018 • PUBLICENTREPRENEUR • PUBLICENTREPRENEUR| | 15

lion barrels per day, which represents over 30% of all production in the United States. Looking at reserves, proven reserves in the United States sit around 38 billion barrels, and over 10 billion of that is in the Permian.”

Even more important, according to Ehsan, is rig count, as this is a measure of investment dollars going into a region. “There are 475 rigs in the Permian, which is more than 40% of US rigs,” says Ehsan, adding that this number also represents around 20% of all oil rigs operating worldwide.

One of the oldest adages in the stock market is to buy low and sell high, and Ehsan utilizes a similar approach to execute the Permex business plan.

The company adds assets to its portfolio in times of general industry distress, thus enabling it to buy properties at a discount.

Importantly, Permex only buys properties that are in production or can be brought online at Permex’s timeline and discretion. Ehsan only considers properties that the company can produce from on day one from active wells, and potentially drill later with an exceedingly high probability of success.

“The timing of our acquisitions has been key,” Ehsan adds. “We acquired assets during a downcycle at an average cost of US$2,000 per acre, and now properties in our area go for anywhere from US$17,000 per acre to US$25,000.”

Permex is careful to only operate in regions where producing formations tend to provide some of the highest historic success ratios, low production costs, extensive infrastructure to get end-product to market, and, importantly, a regulatory regime that favours the industry instead of throwing red tape at it. West Texas and South East New Mexico tick all those boxes.

In fact, one of the formations that Permex wells produce from, the San Andres, has a breakeven cost of US$29 per barrel.

“We have eight properties in West Texas and Southeast New Mexico,” Ehsan says. “Out of those eight, six qualify for water flood EOR (enhanced oil recovery) techniques. To date, our focus has not been to devote too much to capital expenditures. We wanted to purchase assets at a discount during an industry downcycle which caused duress for a lot of operators. Every dollar spent on Capex would have been a dollar we could have used to buy assets at a discount from such operators.”

In the last two quarters, Permex has begun to bring shut-in wells online and use water floods to pressurize reservoirs to enhance production. And the next stage of Ehsan’s strategy really enables Permex to scale its top line.

“Drilling wells in general will give us scale, however we have access to some of the best formations to drill horizontally which can provide remarkable daily production and payouts of under 10 months,” says Ehsan. “Offset operators such as Ring Energy are doing so all around our properties. We anticipate starting our horizontal drilling programs in H1 2019, which can rapidly give scale to the company.”

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That timeline is prudent, as overall production in the Permian has increased to the extent that there are bottlenecks in the pipelines that transport oil to market, and the result is that producers are having to accept a discount to the standard WTI price, although it is nowhere near the discount Canadian producers are exposed to right now.

Again, this is where location comes into play, as adding pipeline capacity in Texas is much easier than it is in most other jurisdictions.

Ehsan says there are four expansion projects in the works, one of which should come online in the first quarter of 2019. The added capacity should MEHR AN begin to shrink the price differential immediately, and eventually eliminate it altogether. This would put smiles on the faces of companies big and small, and it’s worth noting who some of the big ones operating side-by-side with Permex are.

Occidental Petroleum has a major presence in the Permian, as

new chief executive officer Vicki Hollub has shifted operations from a Middle East focus to one more on domestic production, such as in the Permian. Occidental is actually a working interest partner with Permex on one of its properties. Other offset operators to Permex include large-cap oil giants such as Devon, Hess, Apache and Conoco Phillips.

Asked for some closing thoughts, Ehsan points to general investor malaise when it comes to oil and gas stocks yet sees it as an opportunity to apply some ‘Permexian’ thinking. “If you take into account our sector as a whole in the EHSAN US and Canada right now, almost every company is undervalued,” Ehsan concludes. “Usually, oil and gas stocks follow the oil price, but in recent times when oil has risen, the stocks haven’t followed suit. You could say this is a great time to look at investment in the oil and gas sector, as it is ripe for the picking.”

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That demographic is key to the new strategy. According to Fung Global Retail, bricks and mortar retail stores continue to struggle: in 2017, 7,000 stores closed, which is triple the previous year.

It’s a sobering statistic, indeed. But for Costa, it has given her the opportunity to pivot from getting her childrenswear in brick and mortar stores to a model that appears to have more staying power and potential.

Her most challenging time, she said, was in 2008, on the back of the recession when the company was operating as a retail model selling to local boutiques and stores.

“We had to adjust and pivot,” says Costa. “And we did. We found a new model.”

Costa decided to steer Peekaboo Beans in a new direction, away from selling in retail stores to a more unified sales force, through a direct sales model.

As successful as that model’s been, Costa is determined to stay on the leading edge of market, technological and demographic change. To keep out in front, Peekaboo Beans recently transitioned the direct sales platform to an omni-channel approach, one that engages sellers through social platforms, including Instagram and Facebook, as well as other retail channels to maximize revenue and build brand loyalty.

“We’re moving it into a social selling platform where we can leverage technology and grow through an influencer base, social media and blogging—similar to an affiliate model,” says Costa.

Costa says the company is focused on growth on all levels, with a particular emphasis on expanding the US segment of its business, alongside launching an Amazon store very soon. Temporary “pop up” shops have also proven to be successful.

With increased operational efficiencies, better margins and a new recurring revenue model, “we expect to see profitability within the next 12 months with this new platform,” says Costa, adding she hopes to add another 500 affiliates in the United States this year.

The US expansion plan will use a multi-faceted approach and the list of to-do’s is long: creating an e-commerce and wholesale strategy with a focus on certain markets, continuing to develop its social media strategy, attending more industry events, and increasing content with social media influencers.

“We’re building a social impact movement with the people that sell our product,” says Costa, adding that the company places a focus on I wanted to change partnering with manufacturers who have standards that align with its values: no harmthe way that we look at ful chemicals and toxins.

The year 2019 stands to be a good apparel for kids. It was one for the company, as it will continue really about everything to transition from a direct sales model to a social retail platform. that a parent wants, and “This model will allow our Social Stylists to shop, save and earn everything that a child commission through sharing the brand on social media,” says Costa.

For now, Costa continues to push Peekaboo Beans’ forward with loves in their clothing. her goal to establish the company as an industry leader and category king in children’s apparel.

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TRACI COSTA

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NAMESILO TECHNOLOGIES Achieving superior investment returns requires looking where others do not

By Peter Murray

M

ention the name Paul Andreola in Canadian financial circles and those in the know require no further explanation, given his outstanding track record as a stock picker in non-resource microcaps. Taking the methodology that has served him so well as a private investor, Andreola has painstakingly created a portfolio of investments in small companies for NameSilo Technologies (CSE:URL) (note: NameSilo Technologies began trading under its current name and symbol on December 6, 2018. The company previously traded as Brisio Innovations).

NameSilo shares have more than doubled in value over the past year and Andreola credits this in part to a shift in strategy that will see the company take larger percentage positions in its portfolio holdings going forward. Diversification that sees everything from drug research to truss manufacturing included in the portfolio is a big help as well.

The other key to delivering strong returns to shareholders

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is a fascinating private-public arbitrage concept that requires experience and a broad, deep network to achieve.

Andreola shared the NameSilo approach to generating superior investment returns with Public Entrepreneur during a mid-November discussion in Vancouver.

NameSilo Technologies has some similarities to a classic investment fund, but plenty of differences as well. Can you explain the NameSilo concept and business model to get us started?

The company is run by investors first and foremost. We use a model we think is quite rare, especially in the microcap space.

We look for companies that are more advanced than pure startups. Companies that we think have significantly less risk than the typical business entity that gets listed publicly but with as much, if not more, upside. We are looking for situations that have that

perfect risk-reward scenario that allows us to feel comfortable putting in a significant amount of money. We take a private equity model and put it inside a public vehicle.

We are looking for high-growth companies. We want to invest in companies that have proven there is a viable model and, in most cases, viable products and services that they are offering. And we want to catch them just as they are getting that explosive, hockey stick-style growth.

The model itself is something that we have been doing personally for years, and we have now put it into a vehicle such that we can take advantage of the scale that goes with being a public company.

Tell us about the boss. Who is Paul Andreola and what led you to build NameSilo?

I have worn a lot of hats over the many years I have been at this. I used to be a stockbroker and spent roughly 10 years in the investment industry. I have seen a lot of deals and most of them are not good.

The key is to try to say “No” as many times as you can and find that one little gem that comes along every now and then.

I’ve also started two technology companies. One we took public and it did extremely well, and then the other one actually did not do so well. And we learned as much from that one as we did from the one

that was successful. So, I’ve got the start-up and the go-public experience and that helps us when we look at new opportunities.

Thirdly, I have an investment newsletter and a network of investors who all have the same mentality. We all want to find these little gems that are obscure and undiscovered.

And we want to try to bring these companies everything they need to be successful.

It’s a model that we have proven works.

My other director is Colin Bowkett. He comes from a much purer venture capital background and has been in the markets for over 10 years. Compared to me he was a lot more involved in the speculative side of the business and is more of a people

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person than I am. The thing about investing is there are a lot of personalities involved and having someone with good people skills enables you to figure things out that you wouldn’t have been able to without the right skills.

The third key person is Kristaps Ronka. He is an IT specialist who has worked for several tech companies, but his real claim to fame is that he and his partner started a tech company from scratch and took it from zero in sales to a run rate of around $100 million before it got bought out. He took some of the funds from his sale and has invested in a collection of other businesses.

The NameSilo website states that there are lots of good investment opportunities, but NameSilo is looking for great ones. What makes a great investment opportunity?

We take a GARP approach—Growth at a Reasonable Price. There are a lot of cases where you find a great company but it is priced for perfection, and that is not what we are looking for. We are trying to find situations where there is a great company at a great price.

And we don’t just look at the public markets. We have managed to find several high-growth, low-priced public companies and have done it on the private side, too. That is where it gets really exciting because we think there is a very strong pricing arbitrage where you can find a company that might sell privately for 3 or 4 times earnings and the public comparables trade at 10 or 15 times earnings, so immediately there is a lift just by taking these companies public.

How do you find these companies?

We turn over a lot of rocks and are constantly looking. As far as public companies, we are numbers guys and we read every single SEDAR filing in Canada. There are very few companies we haven’t got at least a cursory understanding of. We have a formula we are looking for and if a company doesn’t meet that formula it gets crossed off. We literally go through thousands of them—to find even one you have to go through a lot.

The private ones are a little bit harder to find. We have a network of people who know what we are looking for and typically the network brings us private deals to assess. A lot of them are companies not necessarily looking for money, but they may be looking for an exit. Great little businesses, run well, not necessarily needing money, so we don’t have the risk of financing them, but they just want a partial exit or something. We take them public and achieve that partial exit for them.

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Let’s look at your portfolio and how a company fits into the greater whole and creates value for shareholders.

Perhaps begin with the latest acquisition, which also brought the company a new name.

NameSilo is actually an anomaly. Until now, all of the companies we became involved with, we took no more than a high single-digit percentage ownership position. We’d find companies where in the process of going public we had the opportunity to purchase shares and then when it went public we would get that lift on our 5% or so.

NameSilo is a company we have actually purchased 100% of, though we have carved out a percentage for the management team running it. But here is an opportunity where we think we are going to get 100% of the lift through that private-to-pubic arbitrage. That is likely to be the way we will perform going forward, taking a much larger stake in each company.

NameSilo’s stock price has been doing well of late.

It has doubled since the beginning of the year. What is driving that and what feedback do you get from shareholders?

The biggest driver is the biggest part of our portfolio, which is NameSilo. We think it is outstanding. NameSilo is a domain registrar similar to GoDaddy or Tucows, but it is arguably one of the three fastest growing in the world. The company has been able to automate itself to be able to drive prices down to where nobody can compete on price with our core product. We are growing much faster than GoDaddy on a percentage basis.

We think we bought it extremely cheap in comparison to the other publicly listed companies. We trade at a fraction of the metrics they trade at and we are growing anywhere between 80% and 90% organically, whereas GoDaddy is growing at about 15%. What is driving the NameSilo share price, I believe, is that people are beginning to recognize the undervalued nature of our major asset.

Investing involves looking into the future and making certain assumptions. What do you see around the corner in some of the industries your companies are involved in?

We are always looking for trends but not trends as you typically see in the venture capital market. We want to see established trends. We didn’t invest in the cannabis space. We didn’t invest in the blockchain space. We want to see trends that actually show up in financials.

Colin Bowkett

For example, one of our investments is a company called ImmunoPrecise. They’re a contract research organization for major pharmaceutical companies. What that means is major pharma companies don’t do a lot of the R&D in house but will contract it out to a company such as ImmunoPrecise. That is a major tailwind that a lot of people don’t recognize but that we are seeing in the numbers. We want to see high growth in the businesses we are investing in, because that is a sign the business is working.

The other major trend to be aware of is the topic of passive versus active investing. The FAANG stocks—Facebook and Amazon and those names—there is a massive amount of money going into opportunities that have to be big enough for institutional funds to participate. The old active investor has given way to investing in ETFs or big funds that mirror the indexes or just buy a basket of the biggest stocks.

I think we will see the pendulum swing back to the active investor who is a good stock picker. In the microcap space, liquidity has dried up and institutions have gone upmarket. In the long run what that does is open up a lot more opportunities for investors like me to go after these great little deals without the competition you would usually see. It also opens up a lot of opportunities for bigger companies to buy the smaller companies on the cheap.

Paul Andreola

Any words of advice for up-and-coming entrepreneurs from your years in the business?

The model that we have in Canada in the public markets really is second to none. As entrepreneurs, people should be aware that this tool is there for them. Especially if you have some degree of success. If you have a real business that is generating revenue, and in some cases profits, the ability to take advantage of the model here and some of the valuations you ultimately get, and the options that being public give you, is something entrepreneurs should seriously look at.

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By Peter Murray

VirtualArmour

I N T E R N AT I O N A L Keeping the bad guys at bay with customized network security solutions

E

very week, it seems, brings another concerning story about hackers infiltrating a commercial or government network and making off with highly sensitive information. One would think that with the threat having been clear for so long, entities with significant exposure would have devoted appropriate resources to figuring out how to protect themselves properly. Alas, all too often this seems not to be the case.

VirtualArmour International (CSE:VAI) has a solu-

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tion to this problem, or to put it more accurately, a tailored solution that precisely fits each customer’s risk profile and particular set of network vulnerabilities. Boasting a 100% retention rate across a very broad customer base, the company is obviously doing something right.

Public Entrepreneur spoke recently with VirtualArmour chief executive officer Russ Armbrust about the state of cybersecurity and what his company does to help organizations stay ahead of the curve.

Cyberattacks make the news regularly and the loss of confidence a compromised company suffers can be quite serious. Can you give us your view on the state both of attempts to infiltrate corporate and other networks, and the quality and consistency of efforts being made to counter them?

There are constantly new tactics and techniques being developed to compromise IT assets for valuable information. Considering these tactics are continuously evolving, we make it a point to partner with what we consider the best-in-class technology providers who have proven track records of constantly improving their solutions to stay ahead of this evolution.

The response landscape of cyberattacks has shifted to a proactive approach, looking for behaviour-based activity as opposed to the signature-based approach. Utilizing emerging technologies like artificial in-

telligence to maintain a proactive stance against hackers will continue to improve and aid in keeping pace with the way we respond to these threats.

As far as the quality and consistency of counterefforts, I would say that 90% of companies are very immature at this right now. That is the reason for the growth of our company. Most of the companies we talk to don’t know what they don’t know.

It is a comprehensive process with each of the companies to get them up to the cyber posture they need.

Let’s look several years down the road—what do you project as far as the evolution of network security is concerned?

The traditional model of network security is being challenged and new technologies are becoming commonplace. Everything soon will be connected to the Internet in some way or another, be it wireless, cellu-

lar, Bluetooth or something new. We see that each and every day in commercial advertisements. Now your refrigerator is connected, your oven is connected. With nearly everything expected to be connected, this will produce new attack vectors and require constant development of defense mechanisms and techniques, both proactive and reactive.

Walk us through VirtualArmour’s approach to the problem. What are your competitive advantages—what makes you better? And how does the company keep pace with the constantly changing cybersecurity landscape?

We focus on customer experience. Everyone’s cyber posture is unique, so our goal is to understand the potential cyber gaps of each customer. We focus on becoming a true partnership and acting as an extension of their team. In today’s world, the new 2018 • PUBLICENTREPRENEUR | 27