The Poison Pill

The Poison Pill

A $50 million acquisition. A final code review. A hidden logic bomb buried deep inside the target company’s core database architecture.

In this episode of Pressure Zone, host Christine Bartlett puts Hack The Box founder and CEO Haris Pylarinos into a fast-moving cybersecurity scenario where every decision raises the stakes. What begins as a suspicious discovery inside an acquisition target quickly spirals into a board-level risk crisis involving malicious code, regulatory exposure, internal leaks, and a countdown that could destroy customer data.

As the pressure builds, Haris must decide how to balance growth, trust, disclosure, legal risk, and technical instinct, all while explaining each call in business terms. Should the deal be paused? Should the board be challenged? Should the issue be contained quietly, escalated immediately, or used to renegotiate?

Built as a live decision game rather than a traditional interview, this episode explores what happens when executive leadership meets hacker instinct, and when a business opportunity comes with hidden secrets, bugs, and back doors.

Transcript

SPEAKER_00 0:08

Welcome to the Pressure Zone, the HTB podcast, where we take one security scenario and watch it spiral out of control. I'm Christine Bartlett, and today I'm joined with Harris Pilarnos, founder and CEO of Hack the Box. Harris, the rules are simple. We are walking through a single escalating incident that I'm sure you've been through many times before, that will unfold in a series of questions. At each step, the stakes rise, the constraints tighten, and you'll be forced to make a high-stakes call.

SPEAKER_01 0:45

Okay, I'm I'm super excited right now.

SPEAKER_00 0:49

Awesome. Okay, the clock is starting to tick. You are 72 hours away from the biggest acquisition of your life. 50 million is on the line. Your board is watching, the market is waiting, and you found a ghost in the code. Let's see if you're still a hacker at heart or if you've gone full corporate mode. Question number one: the hacker gut discovery. It's 11 p.m. on a Friday, the deal closes Monday morning, you decided to do one last personal walkthrough of Try KillMe's core database architecture. You find a logic bomb hidden in their automated routing code. It's designed to delete their entire customer database. If a specific admin password isn't changed every 90 days, the founders have never mentioned this to you. What do you do?

SPEAKER_01 1:45

I have a million things to say though.

unknown 1:48

Okay.

SPEAKER_01 1:49

I don't know if the choices will cover it. I have to choose specifically from the choices.

SPEAKER_00 1:54

Uh yes, but you can definitely add in your commentary for sure. Okay. Uh option A, the silent diffusion. You use your own technical skills to quietly neutralize the logic bomb without telling the TKM team, ensuring the deal stays on track. So you take matters into your own hands. Option B, uh stop the clock. Order. Call your board and the TKM lawyers immediately to halt the deal until a full code audit is performed. C, the price renegotiation. Use the discovery as leverage to demand a $10 million discount on the acquisition price, citing significant technical debt. Last option D, the founder confrontation. Call the TKM CEO directly and demand to know why this insurance policy exists in their code.

SPEAKER_01 2:50

Okay. First of all, having coded that thing, meaning deleting the entire customer database, if something is not inputted every 90 days, uh is malicious. There is no best practice, engineering best practice that recommends this. Especially by deleting the customer database. So we might be dealing with something uh malicious. Uh if the founders uh had this slip in, it means that the founders have malicious intents for this transaction.

SPEAKER_00 3:24

Could be.

SPEAKER_01 3:32

This shows malicious intent, either from them or from a third party. And uh to that extent my trust lowers at this point significantly. I'm not fixing it myself because now I I begin to think that there might be other such cases around, whether on a technical level or on a financial level. I don't ask for a better price for that. That could drive the price to absolute zero. It's not. I will ask I will ask for a better price regardless of the outcome, to be very honest, because of that. And I will not just talk with the founders to resolve it. I will probably uh my first step would be to inform the board. At the same time, I would after uh reconvening with the board, I would probably uh contact the seller side. Whether that's founders or bankers or whoever and do a full code review. Although we we would have done a full code review at that point. I would do a second code review, I guess. If that's mandatory for the answer.

SPEAKER_00 4:41

Not necessarily, but I think you know, for your own peace of mind, you might want that if you're still gonna go through with the acquisition. Um okay, so uh it sounds like a little bit of safety first, right? Um maybe you cost the company two million in legal fees for the delay. Uh the TKM team is calling you the deal killer behind your back. Uh is is the logic bomb worth losing the biggest growth opportunity of the decade?

SPEAKER_01 5:16

They're calling me the growth killer. I will call them the customer database eraser then.

SPEAKER_00 5:24

There you go, tip for tell of that. Okay, okay. Question two continues to unfold the regulatory trap. You discovered that the logic bomb isn't just a fail safe, it's actually been pinging in an IP address in a sanctioned country. This means TKM is currently breached. If you buy them, you buy the breach and the legal fines. Do you disclose this to the Securities and Exchange Commission, the SEC, before the deal closes? Okay, here are your options. Option A, the post-close cleanup. Buy the company first, then disclose it as found during integration to avoid killing the deal excitement. Remember, it's a $50 million deal, the biggest one. Option B, the immediate disclosure, report it now. It kills the deal, but it keeps your personal clean personal record clean with the regulators. C the indemnity demand, force the sellers to sign a total liability waiver, making them pay for any future fines resulting from this specific bug. But as you mentioned, it might not just be one, right? Option D, the hacker hunt. Task your team to identify the attacker. If it's a nobody, keep quiet. If it's a nation state, kill the deal.

SPEAKER_01 6:52

If it's a nation state, kill the deal. If it's not, keep it. What if it's not a nation state, but uh customer data has been breached? There are a lot of questions here that uh uh first of all, knowing that uh the company that you are acquiring has been breached, doesn't give you the excuse to sign a waiver telling them okay you have been breached, but it's your problem if something uh arises. Because it's also we have to take into account the safety of our customers, acquiring a bridge company and uh keeping it to our own uh ecosystem, let's say. Listen, I would probably block the deal. I would definitely pause the deal until this is resolved. I might also kill it entirely. So I think we move towards uh number two. I sense something bad is going to come out of this anyway.

SPEAKER_00 7:50

It goes. Uh yeah, you know, it's just you know, like any crisis, right? It's gonna continue uh to spiral. Question three the board ultimatum. The chairman of the board is a growth at all costs guy. He tells you, I don't care about the little buggy code. We need their market share to survive this quarter. Close the deal as soon as possible. How do you respond? A, do you do a technical deep dive and bring the chairman into the lab and show him exactly how the logic bomb would destroy the company's reputation on day one? Um, I think that that'd be highly unlikely, but I'll let you decide. Most board members aren't technical. B, the conditional close, agree to close only if the board authorizes an immediate 10 million emergency security rebuild budget, uh, meaning they're gonna pitch in. C, the resignation threat, tell the board that if they force the deal without a fix, you will resign and go public with your concerns. Or D, the risk taker gamble, close the deal, but move all TKM property uh operations into a sandbox network, effectively running two separate companies for an entire year.

SPEAKER_01 9:12

Okay. D is out of the question because uh you still have the uh uh ultimate responsibility, so uh having a faulty asset can drag down uh the group as well. So we scrap D. Uh A was uh grabbing the board members and uh showing them the code. That doesn't make sense because they will not understand the code. So uh B was um deliver uh apply security fixes, ensure essentially that uh this bridge had no material impact and uh uh uh patch any vulnerabilities present. Right? I'm saying it with my own words to feel better about answering that.

unknown 10:00

That's fair.

SPEAKER_01 10:01

Yeah, I th I I think uh why are we asking for 10 million from uh from the uh shareholders? I assume that's what we do because you said uh we ask the board for 10 million.

SPEAKER_00 10:14

Correct, as as an emergency rebuilding.

SPEAKER_01 10:16

So we don't have money in our bank accounts to to pay the security uh engineers required to fix this.

SPEAKER_00 10:26

Yeah, potentially, yeah. It's almost like an added insurance, right? Like, hey, if you're gonna force me to move forward on this deal, then I'm gonna need additional dollars to do a deep dive here.

SPEAKER_01 10:37

Yes, I think that makes sense. Whether I need or do not need uh additional money to ensure that the asset is clean before uh I proceed with the transaction. Um I will definitely spend a lot of money andor time uh to make sure that uh first of all the breach uh was not material and that it's fully uh resolved before any transaction takes place. That puts another risk: fixing the fixing the entire breach and any vulnerabilities present and then not proceeding with the transaction from the other side. So we fixed you and now you refuse to continue with the transaction. Anyway, I'm sure legally this can be somehow been put to paper so they cannot back down after we do that, or they have to give us back the money. I don't know. I'm sure lawyers will be very creative with this. So to that extent, I will go with uh option B. Meaning first we fix. Uh uh we ensure that uh the the TKM uh uh platform and uh code uh is safe, and then we acquire.

SPEAKER_00 11:56

Okay. So the the this would be more of a kind of a classic compromise, right? A little bit of maybe selling your soul or maybe what you totally believe in, but asking for a better price is is do you think 10 million? I think you kind of already covered this, but do you think 10 million would be enough to fix the foundation that's potentially already rotting?

SPEAKER_01 12:20

10 million, uh additional 10 million security budget for a 50 million company. I think that's uh yeah, that's 20 20% of the entire value of the company to fix its security issues. It's more than it would be needed. Plus anything that I will spend, I will claim it back from the ending price anyway. So it's their money I'm spending essentially.

SPEAKER_00 12:43

I like that. Question four the internal leak. A disgruntled developer at Swift Freight finds out and discovers uh the secret. They post on an anonymous forum that Global Logistics is buying a hollow shell, meaning your company is buying something that you know doesn't exist. The stock price starts to wobble. How do you stabilize the ship? A the CEO CEO keynote, record a video message for the employees of both companies, emphasizing the synergy and ignoring the technical rumors. B the targeted fire, identify the developer using your internal forensics and fire them immediately to send a message. C the counter narrative, leak a story to the press about a new AI innovation coming from the deal to distract and deflect um the market from the logic bomb rumors. And D, the full transparency, hold an all-hands meeting and admit there are integration challenges, but promise they are under control.

SPEAKER_01 13:57

Okay, I think uh uh number four is uh is clear here. I'm say distracting people from the truth because we are not saying you said rumors, they are not rumors, it's a fact now. We know that this thing exists. So if we try to distract them, we know that something is wrong, and we're trying to fool them, which is unethical, even if it's legal.

SPEAKER_00 14:18

Uh and um what was uh option option A was the CEO keynote where you would record a video message to employees of both companies emphasizing the synergy that's about to come and ignore the technical rumors.

SPEAKER_01 14:37

No, I I would definitely address the technical rumors. That's what's the pro what the problem is here. To clarify, the insider that actually uh disclosed this, he or she disclosed it pa publicly within the company. Do we have info on that?

SPEAKER_00 14:56

Yes, they they post on an anonymous forum. So it's it's out there but not heavily we found you know you found out about it. It's known that someone disgruntled as well.

SPEAKER_01 15:07

That that would mean though that the employee is uh uh is doing something uh probably illegal because he's exposing internal confidential information.

SPEAKER_00 15:21

Yes.

SPEAKER_01 15:21

Yeah. Well I would uh do option C, meaning I would tackle the problem, addressing the problem internally saying uh that uh people this is the case, fix it and then proceed with the transaction. And I would try to find also the employ the employee because that employee poses a risk as well for uh for the future. So I would uh can I pick two? Can I fire the employee and do the internal announcement?

SPEAKER_00 15:48

Doesn't mean everybody'll like it, but uh no, that that makes sense. And uh I I'm definitely thankful that you would go for the transparency. Uh honesty is you know the best policy. Um it's also potentially a you know fast way to see a stock drop, right? Um, unfortunately, we know how that goes. Uh you're a brave man, but are your shareholders as brave as you are? So do you think that they would you know back you up in that? I'm gonna say they will.

SPEAKER_01 16:18

I have no idea, but depends on the structure. Maybe they don't have to back me up because they can't get rid of me. But if we're talking about a public company, they can likely get rid of me. Um yeah, it depends on the people. I I can't uh answer that uh not knowing who the shareholders holders will be.

SPEAKER_00 16:43

Uh last one, question five. The day zero choice. It's Monday morning, so this is when you were gonna go public, planning to go public. You decided to go through with the deal, provided all the parameters you you mentioned. You are now the owner of TKM. The logic bomb is still live and triggers in four hours. Your best engineer says he can fix it, but there's a 20% chance it wipes the data out completely. What is your command? A, do it live, give the engineer the green light, we take the 80% odds and pray. B the manual backup, delay the fix and have 10 interns manually print out the most important customer records before the timer hits zero. C the ransom pay, contact the original founders and offer them a retention bonus, essentially a bribe, to defuse the bomb they built. Or D. The hacker CEO moment, push the engineer aside, sit at the terminal, and attempt to diffuse the code yourself.

SPEAKER_01 17:52

To clarify, although we did the numerous code reviews where we were aware of the problem and everything, the time bomb still exists.

SPEAKER_00 18:01

Yes. You weren't able to include the transaction. Yes.

SPEAKER_01 18:11

At that case, I would fire several people, not just the engineer we mentioned previously, to be very honest. Including myself, most probably.

SPEAKER_00 18:23

It's time to go on a sabbatical.

SPEAKER_01 18:26

Um okay, well, um in in that case, uh so as I understood, I'm put in a position where I have no good option. This thing exists, it's my problem now.

SPEAKER_00 18:39

Correct.

SPEAKER_01 18:40

I can't do anything about it. I would not put aside the engineer uh to take over. I would sit next to the engineer to help and make uh ensure that from an 80% probability of success we move to a 90-99% probability of success. Uh but I would jump in at that point. Uh I would be uh very eager not to just to sit next to someone looking at them how they perform instead of me jumping in and trying to resolve it as well.

SPEAKER_00 19:10

Got it, got it. Okay, okay.

SPEAKER_01 19:13

So did I win me?

SPEAKER_00 19:18

Well, the the question is wait, there's one little quick follow-up there. So you roll the dice at 80%, even though you jump in, right? Um it's it's a little bit of a terrifying situation because there's still a chance that it doesn't fully diffuse. If it does fail, are you ready to update your LinkedIn profile?

SPEAKER_01 19:39

I would probably have updated it before I touched the keyboard, Christine.

SPEAKER_00 19:47

Oh, that's good. That's good. So just uh a quick instant replay for folks listening. Uh, we just watched a 50 million deal hang by a thread. Harris, you faced a logic bomb, a boardroom coup, and a regulatory trap. Before we give you your final score, I have to ask at any point in the last 20 minutes or so, did you miss being the guy at the keyboard who didn't have to worry about the stock price?

SPEAKER_01 20:15

I always miss it, Christine, every day to be very uh honest. It doesn't have to be a crisis. On the contrary, crises have a bit of excitement, so to that extent, uh you don't you don't miss writing code, but on the day-to-day stuff is where you miss it the most because uh it depends on the person. I think I I uh I grew up writing code and that's something that I love. So uh if I have to compare uh uh an online meeting versus writing a few lines of code, I will always go for the for the code.

SPEAKER_00 20:55

Love that.

SPEAKER_01 20:56

Although now with AI I don't know how much uh what portion of the code I will write versus the agent. But still, at least I get to review the code.

SPEAKER_00 21:14

Okay, so uh there's a couple options. I think uh where you landed, right? We took a couple safe safe bets, um, which makes sense, but you added in your own kind of approach. Uh we're gonna go with the lawful captain that's uh low risk and higher on the compliance side. You chose uh to you know to disclose with the SEC and the board over you know a quick hot fix and and kind of navigating things your your way in the first go-round. Uh you played it by the book, uh, you know, you wanted to be more of have more of a disclosure um when it came to the employee base. And um, you know, even though it might end up being a more expensive path, um, you know, you're not gonna be the only one here that would get subpoenaed, right, at the end of the day. So um, you know, I think bottom line is you're the adult in the room. Final resilience score will give you an 80. You lost a few points for speed, but you gained them back in sleep quality. Hopefully you can rest easier at night now.

SPEAKER_01 22:26

Thank you. Thank you, Christine. Okay, so 80% uh it's not bad. Better than my school grades for sure.

unknown 22:33

Okay.

SPEAKER_00 22:35

All right, we're just gonna end on uh a quick kind of closing question. As CEO, if you could send a one-sentence encrypted message to your 20 to your 22-year-old hacker self today, what would it say?

SPEAKER_01 22:51

Less logic, more uh more dream.

SPEAKER_00 22:55

Okay, I love that. That's great. Okay, well, that's uh a wrap for the HTV CISO podcast. To our listeners, remember that you aren't just buying a company, you're buying their secrets, their bugs, and their back doors. Join us next time when we call another CISO, and thank you, Harris, for joining us today. Um, and we look forward to putting many more in the hot seat. Uh, until then, I'm your host, Christine Bartlett. Thanks for joining us on the HTB pressure zone.

SPEAKER_01 23:29

Thank you, Christine. Please feel free to include me in the future ones. Uh it was kind of uh exciting, to be very honest.

SPEAKER_00 23:38

Awesome. Thank you for joining us, Harris.