Cybersecurity value chain: explore our theme

Key takeaways

• Rules and real-world breaches keep security spend steady.
• Demand clusters in identity, cloud, data protection, and operations.
• Explore our cybersecurity theme for a simple primer and a curated list of companies to research.

Why cybersecurity spend sticks

Every business runs on software. Cloud, remote work, APIs, and AI create more doors to protect. Boards face tighter rules and faster disclosure. That pushes security from “nice to have” to “must have.”

Budgets cover the basics first—who can log in, what they can reach, how data is protected—and then the tools that help teams detect and respond fast. This theme is not about one headline tool. It is a system that works together and gets updated as threats change.

Inside the cybersecurity value chain

Think of security as a chain. Signals come from users, devices, apps, and networks. Controls enforce policy at the right moment: identity checks, endpoint agents, and cloud rules. Analytics connect the dots to find problems quickly.

Response and resilience limit damage and restore normal operations. Each layer supports the others. Strong identity makes analytics smarter. Good analytics make response faster. Services keep everything current as new risks arise.

Where demand lands

Identity first. Identity decides who gets in and what they can do. Strong login, multi-factor checks, and careful control of admin accounts reduce risk at the source. Deep links to directories and clouds are key.

Cloud and workload security. Simple mistakes create cloud risk. Tools now scan for weak settings, watch permissions, and protect apps while they run. As more AI and data pipelines move to public cloud, these controls move with them.

Data security and resilience. Breaches matter because data moves. Tools find sensitive data, set rules, encrypt, and keep clean backups. The aim is simple: know where data lives and recover quickly if something goes wrong.

Security operations (SecOps). Threats are constant and talent is scarce. Teams use telemetry, analytics, and automation to spot issues sooner and fix them faster. Many add managed services to extend coverage at all hours.

How investors can approach the theme

Diversify across the value chain rather than back a single feature. Blend platforms with specialists in identity, endpoint, cloud, data, and operations. This helps reduce single-product risk and smooth cash-flow profiles across different buying cycles.

Focus on vendors with high renewal rates, clear pricing, and strong integration. Prefer products that customers expand over time with extra seats or modules. Check that delivery keeps pace with the roadmap. 

The companies in our theme and what they do

Palo Alto Networks – A broad platform across network, cloud, and operations. It helps large customers replace multiple point tools with one stack, which can lower complexity and improve visibility over time.

CrowdStrike – Endpoint protection built on lightweight agents and strong cloud analytics. Partners and service teams extend the reach, while add-on modules deepen relationships and lift recurring revenue.

Zscaler – Zero-trust access for users and apps delivered from the cloud. It routes traffic through secure gateways, which helps remote and branch workers connect safely without relying on legacy hardware.

Fortinet – Secure networking at scale, including firewalls and SD-WAN. Custom chips drive performance and cost efficiency, which matters for large distributed networks with tight budgets.

Cloudflare – A global edge network that speeds and protects internet traffic. It blocks attacks like DDoS, filters web requests, and offers zero-trust access—all delivered from data centres close to users.

Verisign – Runs core pieces of internet infrastructure, including the .com and .net registries. Its role is to keep domains reliable and secure, which makes it a stable, behind-the-scenes part of the ecosystem.

How it fits in a portfolio

Cybersecurity can be a growth sleeve that does not depend on consumer cycles. The drivers are steady: rules get tighter, software spreads, and attackers adapt. The theme also diversifies portfolios heavy in general tech, since security budgets often hold through slowdowns.

With the theme and its curated list of companies, you can research leaders and specialists across identity, endpoint, cloud, data and operations. Use it to source new ideas and diversify exposure across the value chain, rather than rely on a single product or vendor.

Key risks

Cyber is durable, but progress is rarely linear. Products can slip when integrations lag, features miss, or costs rise. Talent shortages and supply constraints can slow rollouts. Budgets can shift with macro pressure or internal reorganisations. Big platforms may bundle features and squeeze pricing for stand-alone tools.

After strong runs, valuations can reset quickly. Operations carry risk too—outages, breaches, or support gaps can hurt trust. Currency swings and thin liquidity add volatility in smaller names. To manage these risks, track regulation turning into spend, a vendor’s capacity to deliver, and customer retention through renewals.

Durable demand, simple access

Cyber risk does not pause, and neither do rules. That keeps demand steady across identity, cloud, data protection, and operations. The opportunity is broad, but it rewards discipline. Focus on products that are hard to rip out, visible recurring revenue, and proof that customers add seats and modules over time.

Watch platform consolidation, pricing power, and delivery against roadmap. Size positions sensibly and build exposure in steps rather than all at once. Our theme covers both platforms and specialists and stays anchored to fundamentals, not headlines. Simple idea, durable need: security is maintenance for the digital economy.