The 1M1M Deal Radar 2010: Aprigo ,Waltham, Massachusetts

Aprigo provides data governance and management, storage capacity management, and e-discovery technology solutions to small and mid-sized businesses. The company’s flagship technology, Aprigo NINJA, is available as a freemium solution and as a subscription-based pro version. It’s designed to help organizations gain instant visibility into unstructured data and through its actionable data dashboards so that IT managers can reduce storage costs and control access to sensitive data.

The Waltham, Massachusetts–based company is the 2008 brainchild of three young IT professionals, Gil Zimmermann (CEO), Ron Zalkind (VP of product management), and Tsahy Shapsa (VP of sales and marketing), working together in the Israeli Defense Forces (IDF). They decided they should combine their IT experience to address a common problem among small businesses: the need for an affordable IT solution that provides instant visibility into unstructured data in order to reduce storage costs and control access to sensitive data.

The SaaS-based platform, NINJA, handles access management, resource management, cloud access management, and e-discovery. Features include unified dashboards, folder permission reporting, user access reviews, exposure summary reports, storage capacity management, and a cost calculator. Such features can help IT teams to spend only what is needed on data. For example, a company’s former employee still has data stored on that company’s server. Even though the employee may not have worked at the company for a number of years, the company is still spending thousands of dollars to manage this data and accommodate for data storage needs around it. Aprigo’s platform can show what data can be removed in a secure, compliant, and cost-effective manner.  In one case, a customer was able to clear 60%–80% of orphaned data. Aprigo NINJA is free for companies with fewer than twenty users. The company follows a freemium model. For the subscription-based version of Aprigo NINJA  Pro, everyone gets a seven-day free trial, and companies with more than twenty users pay $1 per user per month; volume, educational, and nonprofit discounts are available. For those using Aprigo NINJA for Google Docs, it’s free for companies with fewer than twenty users and $10 per user per year for companies with more than twenty.

Aprigo is targeting mid-sized businesses, with a sweet spot in organizations with staff sizes in the hundreds to low thousands and terabytes of unstructured data (files), or companies that are using Google Docs to store company information. There are approximately 750,000 to one million businesses worldwide that are the “M” in SMB. These businesses range in revenue from $25 million to $500 million. Their annual storage budgets range from $50,000 to over $1 million, and, says Aprigo, they’re looking for two things: first, a way to save money on storage and avoid the problems associated with the data deluge; and second, an easier way to ensure adherence to regulatory and compliance requirements and internal data governance. The company says that manufacturing, education, healthcare, technology, IT auditors, and service providers have been particularly interested in Aprigo NINJA.

The free version of Aprigo NINJA launched in September 2009 and included only storage utilization capabilities. In March 2010, the company released the paid version of Aprigo NINJA that includes both storage utilization and access management. Since then, over 1,000 companies have used Aprigo NINJA, and Aprigo has dozens of paying customers, Aprigo NINJA for Google Docs was launched in August of 2010, and over fifty companies are using the product.

There are numerous competitors. From an SMB perspective, CA Technologies provides a catalogue of separate storage, security, and IT management applications. Imperva  takes an appliance approach to enterprise customers. Quest Software, a ScriptLogic acquisition, has several products focused on Windows security. Again from an SMB perspective, Symantec’s Data Insight product is part of a data loss prevention (DLP) suite of products that require traditional IT overhead. Finally, Varonis has enterprise offering for large corporations with high-end NAS devices such as EMC, that are focused exclusively on governance.

The company started in 2008 as an incubation project out of Cedar Fund, a venture capital firm that has offices in Israel and Waltham, which led to Cedar’s investment of a $3 million Series A in March 2008. Aprigo will be seeking a second round of financing soon. The ideal investor understands midmarket IT and is a believer in the SaaS model. Revenues are close to $1 million.

Following a three-pronged strategy, Arpigo plans to grow

1. directly, and has built a low-friction model with a combination of off-line and online lead generation activities focused on attracting prospects;
2. through channels; the company works with MSPs IT consultants, auditors, SIs, value-added reseller (VARs), and storage resellers to extend its sales team and is continuing to build its channel network globally, most recently with businesses in the UK, Brazil, and Israel; and
3. through strategic alliances – the company is always looking to work with other companies and partners to explore mutually beneficial activities.

Aprigo says that as the market matures and its own solution matures and becomes more profitable though OEM channel sales, the company will be in a better position for an IPO or to be considered among larger vendors as a valid acquisition to build out their existing product line (e.g., CA Technologies and EMC).

Recommended Readings
Aprigo Secures Google Docs (from InformationWeek)
The 1M/1M Incubation Radar: Actifio

This segment is a part in the series : The 1M1M Deal Radar 2010