From Day 1 to $10M: How Nisos Created the Managed Intelligence Category

Creating a new category in a $6 billion market might seem counterintuitive. Most founders would see that number and rush to grab their slice of existing spend. But in a recent Category Visionaries episode, Nisos CEO David Etue revealed why a massive existing market can actually make innovation harder.

“I think it would be easier to build the managed intelligence market if the threat intelligence market was 1 billion, not 6 billion,” David explains. The challenge? “What’s fascinating about this $6 billion cyber threat intelligence market is that it actually doesn’t sell intelligence. It sells data or information.”

This distinction became Nisos’s key insight. While competitors sold data feeds and analysis tools, they identified a fundamental gap between information and action. David clarifies the hierarchy: “Data is the collection of raw facts, information is data that’s logically arranged, and intelligence is information that’s curated to enable a timely, actionable and relevant decision.”

Rather than compete in the crowded data and information space, Nisos saw an opportunity to deliver something different: finished intelligence that customers could act on immediately. This wasn’t just a marketing angle – it required rethinking their entire business model.

The company started as a consulting firm, which provided crucial market validation. “The founders were two operators in the US intelligence community,” David notes, “and they saw that nation state actors were not just targeting governments, but targeting private sector organizations.” Every consulting project was funded by sophisticated clients willing to pay for solutions to real problems.

But scaling consulting is challenging. The breakthrough came when they “stepped back and said, hey, I think we have, instead of being a consulting company, as they were founded, to really look at how we could invest in the trade craft, our intelligence trade craft and importantly, technology enablement to transform how intelligence was delivered.”

This pivot meant tough decisions. The company turned away revenue from services that didn’t fit their managed intelligence vision. They moved from hourly billing to subscription pricing, taking subscription revenue “from nearly zero to 20% subscription revenue business to north of 90%.”

The key to making this work? Understanding that technology alone wasn’t enough. “Our products are combinations of people, process and technology,” David explains. “But in our case, it’s our people who are a superpower and it’s our people who enable our clients to be heroes.”

This hybrid approach proved powerful. Nisos achieved over 108% net dollar retention, showing that customers found sustained value in their managed intelligence model. They expanded beyond just delivering data to provide intelligence assessments, monitoring, and investigations for cybersecurity, corporate security, and trust and safety teams.

Looking back, David emphasizes focus as the critical success factor. When asked what he’d do differently, his answer was immediate: “Focus. Hands down. Focus.” While their consulting background provided valuable insights, they “ended up supporting, even within managed intelligence, a number of different buying centers and use cases early in our journey.”

The lesson for founders? Sometimes the biggest opportunities come from challenging fundamental assumptions about how value is delivered in established markets. Rather than competing on features or price, Nisos created a new category by solving the core problem – turning information into actionable intelligence – in a fundamentally different way.

It’s a reminder that category creation isn’t just about marketing – it’s about identifying gaps between what customers are buying and what they actually need to succeed. In Nisos’s case, that meant going beyond selling data to delivering intelligence that enables immediate action.