AI Weekly Malaysia

A $10,000 phishing kit called iAuthFlow v2, sold on Russian-language cybercrime forums, uses a browser-in-the-middle attack to enroll attacker-controlled passkeys on compromised accounts within seconds of authentication. Abnormal Security analyzed the kit's demos showing it targeting Google, with packages also advertised for iCloud, LinkedIn, and Microsoft. The rogue passkey persists even after the victim changes their password, defeating standard remediation steps like session revocation and credential rotation.

Why: If you ship passkey-based auth, this kit exposes a gap in enrollment flows: after a successful BitM phishing attack, the attacker can register their own passkey before the victim notices. You should require step-up re-authentication or a verified device challenge before allowing new passkey enrollment, and push real-time alerts to users when a new passkey is added. Standard password rotation and session revocation are no longer sufficient remediation if a rogue passkey is already enrolled.

Runlayer and Rippling dropped their respective lawsuits with no settlement, no money, and no lawyers' fees paid. Rippling immediately released its own MCP gateway—the product at the center of the dispute—after testing Runlayer's version for over a year with closely integrated engineering teams, never signing on as a customer. Runlayer, which launched from stealth in November 2025 and raised $42M from Khosla Ventures and Felicis, alleged Rippling cloned its product in violation of testing agreements.

Why: If you build AI infrastructure like an MCP gateway, a prospective enterprise customer can spend a year deeply integrating with your product, learn your architecture inside out, then ship a competing product instead of paying you. Founders should treat prolonged pilot engagements with large companies as competitive intelligence risk, not just sales pipeline—tighten contractual protections around what partners can access during evaluation, and consider whether your moat survives a well-resourced competitor replicating the core functionality.

An AWS-commissioned study by Strand Partners reports 38% of Malaysian businesses now use at least one AI tool, up from 27% in 2025, totaling 3.4 million businesses. However, 67% remain at basic usage (public chatbots, ready-made tools), only 19% have a formal scaling strategy, and 57% primarily source AI capabilities externally—with 69% saying locally based software providers are important to their adoption.

Why: For Malaysian SaaS founders and developers, the data points to a concrete market gap: manufacturing businesses expect AI to transform their industry (80%) but only 13% feel prepared, and 57% are still experimenting. 43% of businesses working with external providers use them for AI strategy development and 40% for systems integration—meaning sector-specific AI tools and integration services in manufacturing and financial services are where paying demand is concentrated, not generic chatbot wrappers.

monday.com rearchitected its entire platform around Claude after hitting what VP of Product Orly Stern Izhaki called an 'AI dust' ceiling—sprinkling AI automations onto existing workflows without changing the product's core value proposition. After an internal 'AI month' in May 2025 generated excitement but no sustained usage patterns, the company rebuilt from the ground up, reporting 5 million agent interactions within two months of launch across its 250,000-customer base.

Why: If you're adding AI features as bolt-ons to an existing SaaS product, the 'AI dust' problem is real: summarization and categorization features don't create sticky usage. The monday.com case suggests the alternative is a full rearchitecture where agents are woven into the core workflow, not layered on top. For Malaysian SaaS founders weighing incremental AI integration vs. a platform rebuild, this is a concrete data point—though it's an Anthropic-published case study, so treat the 5M interaction figure as marketing-adjacent.

Feedly, the largest standalone RSS reader with 15 million users, has suffered a weeklong web app slowdown that paying users call 'unusable,' with the iOS app also broken and the classic mobile app shut down without warning. CEO Edwin Khodabakchian attributed the issues to a bug, not the company's ongoing pivot to AI-powered cyber threat intelligence, and claimed RSS remains a priority.

Why: If you rely on Feedly as a primary news pipeline for your team or product, you need a fallback RSS source now—this is a second week of degradation with support requests reportedly ignored. For SaaS founders, it's a concrete example of how an AI pivot can erode trust in your core product if reliability slips and communication goes quiet.

AI accounting startup Rillet raised a $100M Series C at a $1B valuation led by Iconiq, with returning backers a16z and Sequoia. The company, which emerged from stealth in 2024, reports 600+ customers, doubled ARR in three months, and integrations with Salesforce and Brex to automate bookkeeping.

Why: This is primarily a funding announcement, but the signal for SaaS founders is concrete: Rillet is positioning AI-native ERP as a direct threat to legacy players like NetSuite, and investors are funding that thesis aggressively. If you build in fintech, accounting, or ERP-adjacent SaaS, expect competitive pressure from AI-native entrants that continuously ingest data from tools like Salesforce and Brex rather than relying on manual entry.