In this episode, we unpack a cutting-edge approach to building lean, high-performance AI models tailored for cybersecurity. Based on our latest white paper, we explore a multi-stage knowledge distillation pipeline that transfers expertise from large teacher models to smaller, more efficient student models like Phi-3 Mini. Topics include structured data enrichment, virtual machine-based learning, test-time reinforcement learning (TTRL), and curiosity-driven exploration powered by Information Theory. Whether you're an AI researcher, cybersecurity professional, or tech strategist, this episode offers a deep yet accessible guide to making specialized AI practical for real-world, resource-constrained environments.