How He Got Here: A Kibbutznik Alum’s Path From Startup to Microsoft

A few years ago, Technion alumnus Omer Schneider ’05 and his partners pitched their young cybersecurity business to one of the wealthiest tech investors in Israel. “You guys are crazy,” the investor said. “How can an Israeli from a kibbutz who rides on camels sell cybersecurity to American utilities?”

“Of course I don’t ride camels,” Mr. Schneider recalled, laughing. “My naïve answer to him was: ‘Because we can. They have a gap and we will do that.’”

Fast forward to June 2020. Mr. Schneider sold CyberX, the company he co-founded and led as CEO, to Microsoft for approximately $165 million, according to media reports. The tech giant was attracted to CyberX for its focus on securing the industrial Internet of Things (IoT) and Operational Technology (OT) networks, which encompasses smart connected devices that monitor and control everything from energy grids and water utilities to pharmaceuticals, manufacturing, and retail logistics facilities.

“Microsoft is one of the largest companies selling cybersecurity, and I’m honored to be a part of it,” Mr. Schneider said at a Boston Business Council breakfast in October co-hosted by the American Technion Society. “The company invests more than $1 billion per year on cybersecurity R&D and has strategic relationships with all of the largest organizations in the world.”

Negotiations started at the end of last year and peaked as the pandemic took hold. “I’m traveling like crazy, getting back from Israel in February, and then suddenly the world went into shutdown,” he said. “We negotiated with Microsoft over Teams.” Mr. Schneider along with his 135 employees were absorbed into Microsoft, which valued both the talent and the intellectual property provided by the start-up, along with its reputation for innovation. “I started work (as senior director of IoT security) four months ago and haven’t met my boss yet,” he said.

At 38 years old, Mr. Schneider has taken something of a long and winding road to become a tech entrepreneur.

Mr. Schneider and two siblings grew up in the seaside city of Netanya, 25 minutes north of Tel Aviv. Most of his relatives are Holocaust survivors and created a close-knit extended family in Netanya. His father was an architect, his mother is the deputy manager at the Netanya municipality, and his grandparents were a local butcher and a real estate developer.

As a high schooler, Mr. Schneider excelled in math and studied weekly at a nearby university. When the time came to plot his next move, “it was quite obvious,” he said. He followed his father and uncle’s footsteps to the Technion and was accepted into the prestigious Israel Defense Forces (IDF) engineering academic reserve program. “It was not a walk in the park, and definitely a character-defining period in my life,” he recalled. “They were fascinating, growing years, growing years,” he said. “One of the strongest experiences I remember from my earlier years at the Technion, was how to set goals and accomplish them while thriving in a smart and competitive environment.” Upon graduating from the academic reserves, he joined the IDF, where his computer engineering degree paved the way for a place in the cybersecurity unit.

He was chosen to attend the IDF officer’s training course and advanced from lieutenant to captain to major, while earning an MBA on the side. He commanded a section in the cyber unit responsible for defending the country from nation-state attacks and was later appointed to join a national committee on cybersecurity, today’s Israeli National Cyber Bureau. “Part of my day-to-day job in the service was to define Israel’s cybersecurity vision. I left my imprint on that vision, the projects, Israel’s program. It was quite fascinating.”

Mr. Schneider was building a promising career in the military, but the lure of the Start-Up Nation weighed on him. “I started to think, ‘are you the next guy to create something extraordinary?’” He and his co-founder, Nir Giller, brainstormed ideas until they found their eureka moment. The industrial domain was in its fourth revolution. To drive higher efficiency and productivity, all companies were going through digital transformation. “People were talking about the cloud and the connectivity of Iot. But the #1 barrier to connectivity was security,” he said. “We realized there was a huge gap in the connected world of IoT.” Mr. Schneider ended his nearly eight-year-long military career in December 2012 and the two launched CyberX in early 2013.

After founding CyberX in Israel, they relocated to Boston in 2016, and Mr. Schneider currently lives in Needham, Massachusetts with his wife and four children. At the time CyberX was acquired by Microsoft, the company’s platform was being used by three of the top 10 U.S. energy utilities and five of the top pharmaceutical companies in the world. Summarizing his CyberX experience and what it means to start a new chapter at Microsoft he said: “Founding CyberX and growing it into a global security player was a great ride with tons of fun, fulfilling challenges, and hard work. We knew we were making a difference by helping protect the critical infrastructure that the world depends on. I’m thrilled about our future at Microsoft and can’t wait to see the broader impact we can now have on the world.”