Leap Academy with Ilana Golan
Gil Shwed: Building Check Point into a $20B Empire and Defining the Future of Cybersecurity
Thu, 20 Feb 2025
Gil Shwed built Check Point into a $20 billion cybersecurity giant, but it all began with a flaw he spotted as a programmer in the Israeli military. Tasked with connecting classified networks, he uncovered a vulnerability, and the idea for a firewall was born. A few years later, he launched Check Point, betting on internet security before the web even existed. At 26 years old, he took the company public despite his doubts. Three decades later, he stepped down as CEO, having reshaped cybersecurity forever. In this episode, Gil joins Ilana to share how he built a problem-solving mindset, landed game-changing deals, scaled a startup from nothing, and led a multibillion-dollar company for 30 years. Gil Shwed is the co-founder and Executive Chairman of Check Point Software Technologies, one of Israel's largest tech companies and the world’s top cybersecurity firm. He was the CEO for 30 years, the longest of any CEO on Nasdaq, and still helps guide the company today. In this episode, Ilana and Gil will discuss: (00:00) Introduction (01:32) Early Programming Passion (02:17) Gaining Problem-Solving Skills in the Military (06:25) The Security Flaw That Inspired Check Point (07:45) How Early Jobs Shaped His Path to Check Point (12:26) Realizing the Need for Firewalls Ahead of Time (15:12) Raising Capital Without VC Funding (17:47) Convincing Companies to Adopt Firewalls (21:06) Closing a $1M Deal After 100 Days of Hustle (28:34) Why Gil Reluctantly Took Check Point Public (33:03) The Secret to His Leadership Success (36:03) Navigating Market Changes and Stress (41:08) How Gil Stays Ahead in Business (44:05) Stepping Down as CEO After 30 Years (49:00) Minimizing Risks in Business (52:13) Building a Startup That Lasts Gil Shwed is the co-founder and Executive Chairman of Check Point Software Technologies, one of Israel's largest tech companies and the world’s top cybersecurity firm. He saw early on how important cybersecurity would be as the world became more connected, helping Check Point grow into a leader in the industry. Gil was the CEO for 30 years, the longest of any CEO on Nasdaq, and still helps guide the company today. Connect with Gil: Gil’s Website: https://www.checkpoint.com/ Leap Academy: Ready to make the LEAP in your career? There is a NEW way for professionals to Advance Their Careers & Make 5-6 figures of EXTRA INCOME in Record Time. Check out our free training today at leapacademy.com/training
Chapter 1: How did Gil Shwed's early life shape his career in cybersecurity?
Gil Shvet, founder and executive chairman of Check Point, the longest serving CEO of any NASDAQ traded company. It's roughly a $20 billion company, the pioneer in cybersecurity and probably the largest company in Israel.
I knew that I want to be an entrepreneur. I dreamt about it since I was 17. When we started, there wasn't even the web. So we are free guys in Israel. We have product. We believe in it. And very few months later, my partners told me, Gil, how do we sell this stuff? They said, you go now to the US and don't come back without a million-dollar check.
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Gil Shvet, founder and executive chairman of Checkpoint. Gil Shvet was the longest serving CEO of any NASDAQ traded company. How cool is that? He founded Checkpoint in Israel. It's roughly a $20 billion company, the pioneer in cybersecurity and probably the largest company in Israel. Gil, you began programming at a very, very young age.
You were curious about computers when we barely knew what it is. So why?
It's a good question why, but I think in the 70s, mid-70s, I think it might have been something to do with my dad that was like a system analyst in computers and one of the early programmers. Very different technologies, very different environments, but probably triggered me. And I don't know, maybe also as a kid, my parents sent me to all these sorts of classes.
And actually, I didn't like most of them. And computing was the first one I registered myself that nobody sent me. So that's maybe one of the reasons.
Wow. So something sparked that interest very, very early on. And in the military, you got into a very elite unit. Those who know, it's called 8200. It's in the Israeli Defense Force. And it is more around intelligence, etc., What did that early experience did for you, Gil? I know I always talk about how we've had more responsibility at age 18, 20 than I had many, many years later.
But talk to me a little bit about that for you.
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Chapter 2: What sparked the idea for Check Point's revolutionary firewall?
First, I've started being a professional sort of quote unquote at the age of like 14, 15. And I worked as an employee at the Hebrew University and then at several other companies, national semiconductors and a few others back in the days. And when I got to the army, I actually, even though I was 18 and really young, I was recruited, quote, as an expert.
And when you think about it, by the way, it's hard to realize that in the Israeli army, first, there are some of the smartest people and they know a lot. But when you think about it, the army only recruits people at the age of 18 with zero experience. So I was brought into open systems, Unix systems, which everybody's using today, the Linux-based systems.
And in the army, I was surrounded by super, super smart people. Many people did their PhD at the age of 17 or 18. And I had to find my own way and how do I contribute to that system with such smart people. And I think one of the interesting things in the Israeli army that... These 18, 20 and maybe, you know, the old guys are the mature guys are 24, 25 years old, get a lot of responsibility.
So I got a lot of interesting tasks and nothing was impossible.
So it's incredible, inspiring, but I think also the military lets you dive into areas that maybe on the day-to-day you usually don't dive in. Where did that hit you in terms of cyber? What did you learn there that you took later on?
So first, back when I was there, it was 37, 38 years ago, there was no cyber. I mean, when we think about the cyber industry, it's all around the internet, and that all started around 30 years ago, so a few years before that. And now it became a powerhouse of cyber, but that's way past my time.
I mean, maybe I was one of the few that started some of the technologies, but not cyber, because there wasn't any cyber warfare in the... late 80s, which were these years. But I think I've learned a lot. And by the way, in the army, you learn a lot. You learn some of the bad stuff. It's a huge system with a lot of bureaucracy, with hierarchy and so on.
You learn some of the good stuff, which is how you get 19 years old kids take any task, break any barrier, break any rule just to get the work done and to achieve the goal. And that's something that it's actually very common to startups without the part about a big bureaucratic system. So when I'm in Checkpoint today, and one of the first thing I said to people, guys, we need rules.
And in order to build a scalable company and a big system, you need rules, you need the All these sorts of things. But we are small enough. So if the rules are not good, we don't go around them. We don't break them. We change them because we can. And that's some of the differences between, you know, what you learn in a system like the army and a system like a startup company.
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Chapter 3: How did Gil Shwed overcome initial challenges in raising capital?
A separate network which was literally over the wall, but for us, it was a big issue from a security. And that's where I got the idea and the challenge to connect two networks securely. Moving fast forward three, four years later, that became the original technology behind our stateful inspection and securing the internet.
But again, it's a completely different environment and different technology, but that's where the original idea came from. Other than that, I think the fact that you can achieve everything and you can do everything is something that I've learned there, and it's a good thing to take into life.
It's actually critical. I think it's that level of confidence that no matter what you have and what you face, you can figure it out, which I think is a big part of something that sometimes as adults we lose in life at some point. And I think it's important to see how to get that back, which I think a lot of our listeners will resonate with.
But you leave the military, you don't necessarily start Checkpoint right off the bat. You do have a few more jobs. What did you gain from some of those experiences? And what do you think that helped you in terms of founding Checkpoint later?
So first, when I left the army, I had the idea and I knew that I want to be an entrepreneur. I'm an entrepreneur from the standpoint, I want to build my product. I dreamt about it since I was 17. At that point, I was like 21, 22. So I already knew that I want that and I was looking for ideas.
And I'll just say the word entrepreneur didn't even exist and you already knew that you want to start something. Go for it.
And I looked at that idea of network security and I said, you know, it's actually a good technology. It's quite simple. It solves a real problem. So it has all the characteristics of a good basis for a startup or for a company. But I didn't find an exciting market for it. classified or compartmentalized, It can be done, but it's not an exciting market. So I actually decided to do other things.
I've actually worked initially as a consultant for several projects, which was great because I moved from one company to another. And I learned how different markets behave and different companies behave. Then I worked at one company. The company was called Optrotech, was in the PCB industry. But I actually worked on a small startup within that company. It was on printing.
A year later, I started another company with my previous boss at that company that we were developing software for an American company as an Israeli kind of subsidiary. And through all of this learning, I've learned so much. In Optrotech, which was back in the days, it was a few hundred people to me. It looks like a giant company.
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Chapter 4: What strategies did Gil Shwed use to sell cybersecurity solutions in the early internet era?
Now, I've saw dozens of companies back in the days, and they all want to connect to the internet and get email and log in remotely and do all these things. And then they say, but what's about all these students in 15,000 universities that were already connected to the internet? They can go now into my computing system and they can look at everything because things are generally wide open.
It's like, you know, putting your house, not just opening the door, but putting it in the middle of the central station in the, you know, in Times Square and being open to the entire world and everybody can just walk in. So the first question is, okay, that's great. I want to be on Times Square.
I want to see everyone, but how do I make sure that people, I can go out, but they cannot come into my store? And that's what the firewall does. It's like this door that looks at who's going out, by the way, which is not always allowed to, and who's coming in, and is that allowed, or that's the right service and right person, and creates the security for that.
And of course, doing it at wire speed that... thinking about future communication protocols, because when we started, there wasn't even the web. So we needed to imagine what will be in the future. And that's what we started doing. And by the way, the response was very high because every company that's connected to the internet asked the same question.
Now, today we're talking about malicious actors that are huge criminal groups and state actors and hacktivists and all sorts. Back then, it was the students from... MIT attacking Caltech and defacing their internet and vice versa and putting files on one another. But again, when you think about it, it's like being on Main Street wide open.
And that's every expert that's connected to the internet thought about that.
You realize there's going to be a real issue, which is pretty incredible because I think both of us were just dazzled by the idea. But you were already looking a few steps ahead, which I want to talk about because that's a theme in your life. But you also decide to raise an extraordinary amount of money. We'll talk about it. This is a joke.
When VCs, I mean, the whole concept of venture capital wasn't really there before. And I am joking because you build this company from basically nothing, how you started. So can you share a little bit?
So, again, we thought, how should we finance ourselves? Now, today, the ecosystem for that in Silicon Valley and in Tel Aviv is very clear versus, you know, VCs and the entire ecosystem, what you need to be supported and what you need to do. Back then, it wasn't that simple.
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Chapter 5: How did Check Point secure its first major deal and grow globally?
So I started calling up the companies that were trying to break in. And one of them, which I also worked with, just told me, come here and check our network. And I found out that somebody was all over their network. And I found traces from other, again, not many companies, because not many companies were on the internet, but that were all connected.
And a few weeks later, the police was able to arrest two teenagers in Israel that basically broke to all the places in Israel that had internet connection, including, you know, utility and infrastructure companies and multinational companies from Silicon Valley that had branches in Israel. So that shows us first that it's real. It's not theoretical. It's not something that you might think.
Even if nobody knows who you are in an hour on the internet, you're a target. Fast forward. Now, how do you sell that product? We are three guys in Israel. We have product. We believe in it. But how do you find the market? So while we established Jump Connection, I did a few trips to the U.S. I mean, we realized, by the way, that if you want to be successful in tech, it's a global market.
You need to be successful in the U.S. If you're successful in America, the entire world will follow. So I've traveled to the U.S., mainly to all parts of it, but mainly to Boston and New York. And we found few beta sites that were ready to test the software. And again, the reaction was very positive. Out of like 19 companies that I met with in a period of few months,
Out of 20 companies, 19 said, we want it, we want to buy. We didn't know how much it cost. We didn't know how much should it cost. But that's a very high success rate. One company, if you're talking about somebody that didn't want it, says, you know what? The software is really cool, but connecting to the internet is not safe enough. We would never connect to the internet.
By the way, that company was Lotus from Boston, the ones that invented the spreadsheet. And by the way, I'm not using this against them because they knew that there was a risk and they knew about the internet. Interestingly enough, a year later, they purchased like 10 or 20 copies of our software. So it took them a year from 94 to 95, but then they became big customers.
And very few months later, my partners told me, Gil, we are working for a year now. We have 20 or 19 active beta sites. The internet is moving in the same direction than we anticipated, but how do we sell this stuff? How do we establish distribution channels We are in Israel. The market is in the US. And again, today there's a market.
I mean, sometimes you can imitate the market and says, that's the market. I put it on the website. That's the channel. There was not selling on the web. I go through these kind of resellers, but they weren't internet resellers. They were PC resellers. They were networking, but not internet. And then they sent me off a road trip. And my goal was very simple.
They said, you go now to the US and don't come back without a million dollar check. I scheduled, I had like a 10-day itinerary in the East Coast, in the West Coast, all over. Very interesting trip. Again, there's a lot of stories. I wouldn't use the full hour to tell the stories. But the end of the story is that I returned from that trip with a million-dollar check. It didn't take me...
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Chapter 6: What lessons from military service influenced Gil Shwed's leadership style?
The next story is that after like a month or two of dancing back and forth like that, they said, you know, we are ready. We want to sign a contract. There are no business terms. Let's meet. So I consulted with one of my mentors, actually our lawyers. our lawyer, and he says, tactically, don't schedule the meeting in Mountain View because you're never going to end the negotiation.
They will always ask for more. And for them, they are not in a hurry. They can always meet next week. They are not rushing. They said, we'll come to Tel Aviv. I said, no way, because they'll come to Tel Aviv and they see, no matter that you know that there are three or four people they'll come to and they see that you have a one room office you're going to get a lot from that deal
So we ended up doing the meeting in New York. We were three people at the company. Sun, of course, was this giant company. We ended up bringing 10 people from Checkpoint and three people from Sun. They brought product manager, business development, and the lawyer. We brought three lawyers, three board members, two consultants, the three of us. So we kind of added 10 people in the room.
They were showing up like Silicon Valley guys with jeans and t-shirts. We were with suits and ties. We spent an entire week in that conference room. I was the youngest person by far in the room, 25, 26 years old, running the meeting with these big lawyers from New York and so on. And we ended up the week with understanding of what the deal would look like. And that's where things started rolling.
Hey, I'm pausing here for a second. I hope you're enjoying this amazing conversation as much as I do. Don't forget to subscribe and download. Now, if you're looking to leap your own career, Figure out what's next for you. Fast track your own growth. Create a portfolio career. Check out my free 30-minute training at leapacademy.com slash training. That's leapacademy.com slash training.
Now back to the show. There's the book chutzpah or the word chutzpah. You know, I mean, there's something about knowing how to create our own luck, I think, that is playing a really important role here. And I love these examples. Now, I think, and correct me if I'm wrong, Gil, but only after about three years, you decided to go public with Checkpoint. You're super young. Why did you decide it?
How did you know how to do it? Talk to us a little bit, because that's a big deal in every perspective.
So first, I didn't want to go public. My shareholder really pushed me. And back then, the hurdle to go public was much lower than today. Today, it's like at least $100 million. Back then, growing at $10 million was good enough. And at that point, we were more than $10 million in sales. We were super profitable, which, by the way, very high there and doesn't exist today.
We were like making $10 million of sales or $5 or $6 million in profit. So we were very lean and so on. And even a year earlier, my shareholder told me, you know, Gil, it's time to go public. We have bankers here. Let's go. And I said, guys, no way I'm building a company. I'm not trying to do an exit. I don't need the money.
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