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Bessemer Data Security News

7.19.11 Reputation.com Raises a New $41M Round (WSJ)

Bessemer Data Security Blogs

Data Security Practice Overview

Bessemer’s investment practice in data security ranks among our most successful, and we’re proud to have funded more leading innovators in data security than any other venture capital firm (as far as we know). At last count we’ve made 23 investments that have led to five IPOs and ten acquisitions by public companies. At the time we exited these investments, they accounted for over thirty billion dollars of enterprise value and nearly 20,000 jobs.
Description

Every technology dating back to the invention of the wheel can be used to help or to hurt, and the internet is no exception. So in 1993, at the dawn of the commercial internet, Bessemer launched a series of investment road maps based on the hypothesis that demand would explode for defenses from cyber-crime.

We define cyber-crime as the unauthorized usage or destruction of any digital resource. Cyber-thieves piggyback on our networks, peek into our databases, deface our virtual storefronts, raid our bank accounts, steal our identities, divert our web queries, advertise on our computer screens, and spam our inboxes. As the internet’s functionality grows richer, so does the  cyber-criminal’s arsenal.

The principles we follow in assessing security solutions follow the ideas of security experts such as Bruce Schneier, Ron Rivest, and Dan Farmer. We value open, peer-reviewed security methodologies, simple deployments, a service orientation, and a clear return on investment. We’ve funded security startups that sell software licenses (Worldtalk), appliances (Altiga), and semi-conductors (Tilera), but the majority of our startups sell security as a service, since security solutions must constantly adapt to evolving threats, and it takes highly specialized knowledge to monitor and maintain an effective defense.

We are wary of security through obscurity, brittle secrets, and “strongest chain” solutions. For these and other reasons, we’ve steered clear of security startups in biometrics, hardware, cryptographic protocols, single sign-on, mobile firewalls, DRM, and homeland security.

Around 2003 we shifted our focus from securing enterprises to protecting consumers and small businesses from threats such as spam, malware, and identity theft. So we funded startups like Cyota (protects online bank accounts), Postini (filters spam), Intego (secures Macs), SiteAdvisor (fights malware and phishing), and Lifelock (prevents credit application fraud).

Over the years Bessemer has hosted the founders of many successful data security companies as entrepreneurs-in-residence— Jeff Smith (Tumbleweed), Chris Risley (On Technology), Mark Jung (Worldtalk), Peter Watkins, Schwark Satyavolu (Yodlee) and Chini Krishnan (Valicert). In other instances – such as Verisign, Determina and SiteAdvisor – we started the companies in our offices based on internally developed business plans, and subsequently recruited the management teams. Today our security team includes the former GM of Broadcom’s security division (Devesh Garg), the co-founder of Verisign (David Cowan), and the founder of Valicert (Chini Krishnan).
Past Investments Current Portfolio
Investment Team
David Cowan Liad Agmon Nate Fick Chini Krishnan Ethan Kurzweil
David
Cowan 		Liad
Agmon 		Nate
Fick 		Chini
Krishnan 		Ethan
Kurzweil
Jeremy Levine Trevor Oelschig
Jeremy
Levine 		Trevor
Oelschig

Bessemer’s investment practice in data security ranks among our most successful, and we’re proud to have funded more leading innovators in data security than any other venture capital firm (as far as we know).

Altiga was a pioneer of Virtual Private Network communications equipment. BVP invested in all three of its rounds, starting in 1998. In 2000, Cisco (NASDAQ CSCO) acquired the company.

Chini Krishnan founded Valicert to commercialize his cryptographic inventions, taking it public and then selling it to Tumbleweed—both companies were David Cowan investments. As a Bessemer Operating Partner, Chini founded Vimo, a health insurance comparison site, in 2005. He advises Bessemer companies in the U.S. and in Mumbai, where he was raised.

Counterpane Systems is a data security monitoring service that monitors the firewalls and intrusion detection products protecting corporate networks.

Cyota is the leading player in the anti-fraud space, specializing in financial institutions. It specializes in fraud related to the Internet, such as online banking fraud, eCommerce fraud and phishing. In December 2005, Cyota was acquired by RSA Security (NASDAQ:RSAS).

David Cowan joined Bessemer in 1992. Of his 45 early-stage investments, 18 were acquired and 19 went public.

Ethan managed and is closely involved with Bessemer’s investments in Playdom (acquired by Disney), Zoosk, CrowdFlower, Reputation.com, adap.tv, Twilio, Skybox Imaging and Mailrank. He serves as a board observer for those companies as well as Lifelock, Smule, Truaxis (formerly Billshrink), Delivery Agent, MashLogic and Nominum.  He is currently on the board of directors of CrowdFlower, SweetLabs and Mailrank, an internal BVP incubation.

Finjan develops enterprise security software that prevents attack from malicious Net enabled code including Trojan executables, Java, ActiveX, JavaScript and Visual Basic Script.

Intego's software products protect the Macintosh computers of more than a million users in 60 countries from the dangers of the Internet.

Jeremy is a Partner with Bessemer Venture Partners. He focuses primarily on software and services investments. Prior to joining BVP in 2001, Jeremy was Vice President of Operations at Dash, an Internet software publisher. Jeremy joined Dash from AEA Investors, a private equity firm with an expertise in leveraged an

Liad Agmon joined BVP as an Entrepreneur in Resident in 2010. Based in the Israel office, he focuses on opportunities that create value by applying new technologies in solving problems and simplifying user experiences. Most recently, Liad was the VP

 The nation's first ID theft protection company.

  Nate Fick joined Bessemer as an operating partner in 2011. He is chief executive officer of the Center for a New American Security (CNAS), an independent non profit that develops innovative national security policies and cultivates outstanding talent in

Nominum is a pioneering provider of IP address infrastructure software for enterprises that require reliable and secure DNS, DHCP and IP address management for their mission critical networks. Nominum is driving the future of IP addressing.

 Perimeter provides comprehensive, on-demand messaging and security services to thousands of businesses.

Incubated in BVP's offices, SiteAdvisor developed a centralized service that protects consumers from web-based security threats. It was acquired by McAfee (NYSE:MFE) in April 2006.

 Trevor Oelschig is a Senior Associate in BVP’s New York office. He works with Rob Stavis, focusing on opportunities in software, consumer technologies, and digital and mobile media. Prior to BVP, Trevor was an Associate with Panorama Capital (previously JPMorgan

Tripwire, Inc. is a software-development company specializing in system security and policy compliance applications. In May 2011, it was aquired by Thoma Bravo.

 Tumbleweed's Integrated Messaging System extends existing e mail and web applications by creating a secure, traceable and personalized online communication environment. BVP's David Cowan participated in the company's 1997 recapitalization. It went public in 1999 as (NASDAQ TMWD), and has

VeriSign is the leading provider of trusted infrastructure services. David Cowan co-founded the company in 1995 as a spin-out from RSA, and served as VeriSign's initial Chairman and CFO. The company went public in 1998 (NASDAQ:VRSN).

Valicert provides security products for the Internet. After going public in 2000, it was purchased by Tumbleweed (NASDAQ TMWD) three years later.