Nir Zuk On Setting Up New Digital Bank In Israel
He founded cybersecurity behemoth Palo Alto Networks.
Palo Alto Networks founder Nir Zuk has a new fintech project in the works. Multiple reports citing insiders say that he intends to open a new digital bank in Israel with former Israel Securities Authority (ISA) chairman Shmuel Hauser and entrepreneur Yuval Aloni. This would be the country’s second digital bank. Zuk only recently moved back to Israel after 20 years in California.
Palo Alto Networks Currently has a market cap of about $35 billion. Zuk himself is estimated to be worth somewhere in the high nine figures, but short of the coveted billionaire status.
Nir Zuk founded Palo Alto Networks in 2005 and has served on the board since its inception. He is former entrepreneur in residence at Greylock Partners, a successful serial entrepreneur and a network security expert. Prior to co-founding Palo Alto Networks, Nir Zuk was CTO at NetScreen Technologies, acquired by Juniper Networks in 2004. Prior to NetScreen, Nir was co-founder and CTO at OneSecure, a pioneer in intrusion prevention and detection appliances. Nir was also a principal engineer at Check Point Software Technologies and was one of the developers of stateful inspection technology.
So what is a digital bank anyway? Digital banking has to do with how everything is switching to online and cloud services these days. This includes the financial sector, both with investments and personal banking. In this way digital banking is a type of fintech. New technologies are in development worldwide to facilitate this. There is no lack of fintech startups in the world, especially in Israel, Startup Nation.
Digital banking requires sophisticated automated processes and web-based services and may include APIs enabling cross-institutional service composition to deliver banking products and provide transactions. The field also deals with the day to day banking services which people everywhere depend on being able to process on line and thorough apps.
This also explains why there is such demand for cybersecurity startups as well: all that digital banking needs to be protected from hackers. And Nir Zuk is the right kind of person to also deal with cyber security threats as in addition to Palo Alto Networks he also was a founder of Israeli firm Check Point which made its fortune developing firewalls.
According to Globes, this digital bank will differ from others in that it will have a new kind of format not presently in use, both in terms of the services that it offered and possibly also in the clients can access the bank. It will also offer loans and other financial products on competitive terms to other bodies currently providing credit.
Calcalist has added that Zuk has already invested tens of millions of dollars of his own money in the project. Whatever the new bank will be, it is expected to begin raising hundreds of millions of shekels from local Israeli institutional investors next week. Calcalist says that the new bank expects to soon already have a valuation of around $500 million. The new digital bank is in the process of receiving its license from the Bank of Israel.
Now $500 million valuation so quickly is a really big deal. The bank will already be halfway to unicorn status. But remember that Mr. Zuk has put a lot of his own money into this project, which should bring it a great deal of confidence among potential investors. Imagine if Warren Buffet or George Soros put immense sums into a new startup. Surely other investors would be rushing to get in on the bandwagon too.
The Bank of Israel responded to the news in a statement to Globes saying, “As part the development of competition in banking, the Supervisor of Banks supports various ventures interested in developing future banking activities. We do not relate specifically to this or that venture.”
The new bank is currently in the process of acquiring the necessary licensing and government approvals.