Deal Radar 2009: Trustwave

Trustwave provides on-demand data security and payment card industry compliance management solutions to businesses and organizations worldwide.  The company helps both Fortune 500s and small and mid-sized businesses to secure their network infrastructure, data communications, and critical information assets as well as manage compliance.  Today, when cyber thieves can hack into networks of companies big and small, as demonstrated by the attacks on Twitter earlier in the year, the security measures offered by companies such as Trustwave have become a necessity for most organizations.

The security measures offered include digital certificates, security awareness education, intrusion detection systems as well as several other solutions. All are designed to help assess an organization’s compliance with industry standards and analyze the company’s ability to withstand any security threat to its systems, Trustwave has also designed its solutions such as SSL certificates and Unified Threat Management appliances to lower the total cost of ownership for businesses around the world.  A few days ago, Trustwave announced an on-demand, tokenless two-factor authentication solution that couples digital certificates, representing user identities, with an existing Virtual Private Network. This is expected to reduce the costs associated with token-based authentication, and eliminate the need to track inventory and maintain associated hardware and software.

Trustwave was formed in 1995 by Joseph Patanella, who had been with the National Security Agency (NSA) for about eighteen years.  The company provided enterprise information assurance services and solutions to corporate, educational, and government clients. Trustwave was the first organization to be rated and certified by the NSA to conduct Critical Infrastructure Assessments, a key to presidential policy establishing information security benchmarks for the nation’s critical infrastructure.

Ambiron merged with Trustwave in 2005 to form the company in its current state.  Ambiron was founded by Robert J. McCullen, president, chairman CEO, and Andrew Bokor, COO. The company is based in Chicago with offices in Asia, Africa, Australia, Europe, and North and South America.  Robert McCullen was a co-founder of Ambiron and one of its two managing partners, prior to its merging with Trustwave. Before that, he was the director of product management and corporate development for the consulting services division of global digital trust services provider, VeriSign. Immediately prior, he was a founding partner of Exault before its subsequent acquisition by VeriSign. He was also a partner with Netrex, which was eventually acquired by Internet Security Systems (ISS) and has spent eight years at Sun Microsystems before that.  Prior to Ambiron, Bokor was the director of consulting for VeriSign, responsible for the North American consulting team.  Earlier, Bokor was a founding partner of Exault, a security-focused consulting firm that was profitable every quarter without outside funding, before its acquisition by VeriSign. In 2004, Trustwave raised $10 million in Series A funding from FTVentures.

In September of this year, Trustwave acquired Vericept, a provider of data loss prevention (DLP) and intellectual property protection solutions. In February of this year, Trustwave announced the acquisition of Mirage Networks, developers of full-cycle network access control (NAC) technology. Trustwave also acquired another company ControlPath, a provider of compliance solutions in August 2008.

There are several security firms such as Fortify Software, Red Seal, and Core Security Technologies aside from the bigger names including McAfee, WebSense, Blue Coat, and Symantec.  Barracuda Networks, which I covered earlier this month, also provides content security products to protect organizations from email, IM, and Web threats.

This seems to be the recent trend in the industry; other companies have also done mergers or made acquisitions. Over a year ago, McAfee acquired Reconnex, a maker of data protection appliances and software. In 2006, it bought Onigma, a company that made software for a similar purpose. In January, Computer Associates also acquired Orchestria to strengthen its position in the industry.

Trustwave currently has approximately 600,000 customers.  The multi-billion-dollar security market is growing rapidly: a recent report said that worldwide content security gateway revenues alone grew 1.5% over the second quarter of 2009 to reach $544 million. The market is expected to grow to $3.2 billion, with an increasing focus on virtualization, cloud computing and SaaS, coupled with the increasing number of security threats.  The North American content security market is expected to cross the $1 billion mark in 2009.

Recommended Reading:
Security Industry Overview
Trusting Untrusted Computers

This segment is a part in the series : Deal Radar 2009