Walmart just invested in Israel startup, Team8, founded by the former leaders of the country's top intelligence unit. (Photo by Michael Brochstein/SOPA Images/LightRocket via Getty Images)
In the sophisticated global cyber security battle, coupled with merchants’ growing demand for personalized data to market to their customers, Walmart and major global corporate giants including Airbus and Softbank have invested in Team8, a cyber-security think tank founded by former leaders of Israel's top military intelligence Unit 8200 --think cream of the crop -- in a place already known as the startup nation.
Walmart and the other partners have committed $85 million in capital and formed an international coalition under Team8 that would exchange ideas on different cyber issues. It will also help Team8 come up with businesses that will help companies “thrive in the face of growing cyber threat” and not just play defense, Team8 said Tuesday. With the investment, Walmart and the others also join Team8’s existing partners including Microsoft, Nokia, Cisco and Innovation Endeavors, co-founded by former Google CEO Eric Schmidt. Team8, founded in 2014, said it has raised more than $260 million to date.
“Retailers want to be able to leverage more of the data they could have about their customers,” said Yuval Shachar, co-founder and executive chairman of Team8, in an interview. “Data can provide a lot of interesting insights. But if you want to leverage data, you also have to worry about keeping that data secure.”
The partnership with Walmart came about after Walmart President and CEO Doug McMillon and other Walmart executives visted Team8 in its Tel Aviv home office last year, Shachar told me.
“When you have such a magnitude of Walmart, you want to make sure everything is safe,” Shachar said. “Retailers hold a lot of credit card information of customers. They know a lot about customers’ habits. They also have pretty complex supply chain…..It creates a variety of challenges that we didn’t think before.”
Team8 is developing tools that would allow companies to securely share their customer data with third party vendors in the cloud – a move that could allow those vendors to use machine learning to learn about consumer behavior and help merchants like Walmart better make predictions about individual customers' needs and wants -- while leaving that data encrypted, he said.
"Walmart's readiness to experiment with and adopt emerging technologies such as blockchain, VR and robotics is pivotal to continually improve our customer shopping experience, stay ahead of the curve and drive market share,” said Jerry Geisler, Walmart’s Global Chief Information Security Officer, in a statement, adding Walmart was attracted by Team8’s “cybersecurity expertise.” “Our ongoing digital transformation initiatives are underpinned by more connectivity and collaboration than ever before and robust security for our customers, employees and partners is what allows the technology to deliver business value.”
In another telling sign of concerns about cyber security and data breaches, even though cloud is a big buzzword, Team8’s Shachar said most of the consumer information that banks hold, for instance, is actually still stored in their own data centers and not in the publilc cloud. The same goes for consumers’ medical data, he said.
“Regulators are concerned that these data will fall into the wrong hands” in the public cloud, he said.
But don't think that Walmart's investment in Team8 is just about cybersecurity. The investment behind Team8 shares a common reason that is also behind many of Walmart's other moves.
“Amazon is a cloud company,” Shachar told me. “They are way ahead of the curve…Amazon is the forerunner in terms of digital transformation. Everybody is catching up.”
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