Deal Radar 2009: Alert Logic

Houston, Texas-based Alert Logic is an on-demand IT compliance and security solutions provider. Founded in 2002, Alert Logic provides SaaS-based solutions that allow its customers to detect threats, eliminate vulnerabilities, and manage log data. Its cloud-based platform provides customers with an easy way to secure networks and comply with policies and regulations.

Alert Logic provides a number of solutions that include Log Manager, a log management solution that collects, aggregates, and compresses log data on customers’ networks and performs processing, analysis, reporting, forensics, and secure archiving in customers’ data centers; IT compliance management; architecture solutions; and threat monitoring and vulnerability scanning services. Threat Manager provides a layer of network defense against threats that bypass perimeter and endpoint defenses. The solution is designed to be easy to use and gives users access to Web GUIs, including a dashboard for an in-depth overview of network incidents. The company provides both incident- and non-incident-based support. Non-incident support includes phone and email technical support during business hours, along with access to an online knowledge base; incident-based support includes either premium or standard monitoring. The premium monitoring service detects and escalates security incidents for network threats to protected networks within 30 minutes of a threat’s occurrence and standard monitoring within 12 hours of an occurrence. Pricing begins at $1,100 per month.

The company has customers from a wide range of industries, including the financial services, healthcare and retail sectors. Customers include Rosetta Stone, Everbridge, GSI Commerce, Amarillo National Bank, and the Harris County Hospital District, among others. Since Alert Logic’s solutions enable merchants to meet several of the Payment Card Industry (PCI) Data Security Standards’ requirements, it opened the way for Alert Logic in the retail sector, and the company is a certified PCI Security Standards Council Approved Scanning Vendor.

IDC reports that the percentage of U.S. firms that plan to spend at least 25 percent of their IT budgets on SaaS applications is expected to increase from 23 percent in 2008 to nearly 45 percent in 2010. Claiming a slice of the pie are companies like ArcSight, LogLogic, LogRhythm, RSA Security, SenSage, and Splunk, which help IT departments search and analyze log files. Both ArcSight and RSA Security also sell leading security event management systems that collect event log data across network and security devices, correlating network events in real time to identify threats as they happen. Further, the company also needs to look out for Qualys, which is the leading cloud-based network vulnerability assessment provider.

However, Alert Logic is gaining recognition in the industry as well. In December 2009, the company was named a finalist in the Best Security Information/Event Management (SIM/SEM) Solution category in the 2010 SC Awards for outstanding achievement in information technology security. It was also awarded the Houston Business Journal’s Fast Tech 50 award in November 2009.

The company has raised nearly $16 million in venture capital so far: less than $1 million in angel funding in 2002; a $2.3 million series A from DFJ Mercury, OCA Ventures, and Access Venture Partners in 2005; a $5 million Series B from Hunt Ventures, DFJ Mercury, OCA Venture Partners, and Access Venture Partners in July 2006; and an $8.25 million Series C from Hunt Ventures, DFJ Mercury, OCA Venture Partners, and Access Venture Partners in March 2008. The company reported that it enjoyed 80% revenue growth in 2008 and has nearly doubled its customer base for the second year in a row. The company anticipates growth in 2009 and has already witnessed a 61% increase in its customer base and 53% revenue growth (Q1 2008 to Q1 2009). Alert Logic has no plans for an exit anytime soon.

Suggested Reading:
*Deal Radar 2009: LogLogic
*Concept Arbitrage: Qualys

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