NSA Chief’s CyberSec “Startup” Collapses After Fraud Scandal!

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October 9, 2024

Video Summary

Over the last 20 years, the American Tech sector has produced some of the most valuable and innovative enterprises in history. Meanwhile, the American defense establishment has lost two major wars to “goat farmers.” I’m a US Army Combat veteran, and we’re going to talk about what happens when the US Army’s top cyber general starts his own tech company. It didn’t go well.

Iron Net, the cybersecurity firm founded by the head of the NSA, General Keith Alexander, has officially filed for bankruptcy. What happened? Keith Alexander is a respected military leader, but he’s not a fan of the private sector. He thinks his military background and experience in signals intelligence make him uniquely qualified to build a successful tech company, but the data suggests otherwise.

Iron Net was supposed to revolutionize the way governments and corporations combat cyber attacks. The company claimed to compile data on all its clients and use that to predict and prevent cyber attacks. But it never delivered on its promises. In fact, it committed fraud multiple times. The company was valued at billions, despite not making any money. It became a publicly traded company through a process called a “spac” (special purpose acquisition company), where a shell company is created to take a private company public.

The largest owner of Iron Net, C5 Capital, is a South African firm with connections to the US government and links to notorious figures like Jeffrey Epstein. C5 recruited high-ranking government officials, including a former Joint Chiefs of Staff and a former UK counterpart of the NSA. But one of its most notable connections is to a Russian oligarch, who was sanctioned by the US Treasury Department for engaging in “soft power activities” on behalf of the Kremlin.

Iron Net’s leaders didn’t understand the private sector, which values profit and loss statements. The company prioritized its “collective defense platform” over actual cybersecurity, resulting in failed contracts and a 60% reduction in revenue projections. The company’s leadership, including Alexander, never developed the technical skills necessary to build a successful startup. They relied on their military backgrounds and managed, rather than innovated, new technologies. And that’s the problem with military leaders trying to start tech companies. The culture prioritizes management over building something new from scratch.