15 Oct 2020 | 09.48 am
Endpoint Security For Mobile Devices
Bobby Healy's Corrata in Blackrock has the solution
15 Oct 2020 | 09.48 am
Coronavirus is boon for Dublin mobile cybersecurity startup Corrata as more employees work remotely, writes Robert O’Brien
The Covid-19 pandemic has been wreaking havoc on businesses but the virus has also become an accelerant of remote working. With employers facilitating self-isolating staff to work from home, that suits south Dublin venture Corrata, which has a focus on mobile cybersecurity solutions.
Corrata’s marketing slogan, devised before Covid-19 emerged, looks very apposite now – ‘the immune system for mobile’. Founded in 2016, Corrata’s software sits on devices with the promise of strong security, with the system monitoring device traffic for anomalies associated with phishing attempts, hacks or other malware activity.
The Corrata product, which was granted a US patent in 2020, can also control data use and filter content. “It’s like a firewall for your mobile phone to protect it from all the bad stuff out there,” says co-founder Bobby Healy (pictured).
Corrata’s software replicates for iOS and Android operating systems the endpoint security found in office networks. “Through the combination of cloud and mobile technologies, businesses now rely on data centres and cloud servers that are outside of their offices and buildings,” Healy explains. “The security infrastructure that businesses had in place for that old world, where they had all staff and servers in the one building, has been revolutionised.
“You need the same level of protection that you once had in your office building on the devices that your staff use while out and about. This requires a wholly different type of technology, which is what Corrata has pioneered in the mobile space. In the traditional Windows environment, you can put a piece of software on your device and it will monitor everything that’s happening on that device. The setup is different on mobile because the operating systems are extremely locked down.”
Healy (56) and co-founder Brendan McDonagh (55) have successful track records in business. Healy headed up Xiam Technologies, a venture that was acquired by Qualcomm in 2008. McDonagh co-founded telecoms software company Arantech, which was bought by US business Tektronix Communications in 2009.
A similar exit from Corrata is possible, says Healy, but not in the near term. “The first hill we have to climb is to build Corrata into a substantial global business, employing up to 200 people. The history of most Irish companies like ours is that at some point they get acquired by larger businesses. We don’t see that happening with Corrata anytime soon but it may be something that will happen in the longer term.
“Xiam pioneered the use of machine learning in the mobile space, specifically around making it easier for end users to discover content on mobile,” Healy adds. “We developed the first recommendation engines for mobile apps, which is what led to Qualcomm acquiring us.”
Healy continued working with Qualcomm for five years after the Xiam sale, running the company’s internet services business in Europe and leading the Xiam business unit. “I stayed with Qualcomm longer than I expected but it was a great place to work. Along with Google and Apple, Qualcomm was bringing the smartphone revolution to realisation. Xiam’s acquisition meant that I had a certain amount of financial independence, which put me in a position to go again at creating a business.”
Healy met McDonagh through Enterprise Ireland’s Leadership 4 Growth programme, which brings successful CEOs together to learn how to scale businesses internationally. “Brendan exited Arantech shortly after my exit from Xiam. He has since been involved with a number of successful businesses on the tech side, in a non-exec, part-time basis,” says Healy.
“I was looking around for opportunities to create a company such as Corrata and it made sense for us to go into business together, and for me to take the lead in running the company,” Healy adds. “The idea for Corrata was 80% Brendan and his colleagues and probably 20% mine.”
Corrata’s key customer segments include sectors working with the security-sensitive information, such as financial services, health care and government organisations. “Another area where we are finding traction is businesses with a lot of mobile workers. Key clients here include Ulster Bank and Maxgen Energy Services. “Our main focus today is on the US market. We have partnered with a number of telcos in the US, who introduce Corrata to their customers. We are also constantly developing partnerships with large tech companies, such as Microsoft.”
Healy and McDonagh used their contacts in the tech industry to rustle up seed funding for Corrata, which closed a €1.3m round in 2018 and topped up with another €400,000 in 2019.
The 2018 fundraiser was led by Delta Partners (c.€700,000) and included a number of high-profile angel investors, among them Hostelworld co-founder Tom Kennedy and Kieran McGowan, the former IDA and CRH chairman. Healy (c.€86,000) and McDonagh (c.€388,000) also invested in their venture. In 2019, the funding round again included Delta Partners (c.€170,000), while Kennedy and McGowan also participated.
“We have a good track record with previous investors,” says Healy. “Delta Partners is our venture investor and it was the main investor in Xiam Technologies. So far we have looked to a relatively close-knit group of investors for backing. If our business plans require it, we’re open to looking at a larger group of investors. They would need to have expertise and a focus on the cybersecurity space.”
In terms of ongoing business challenges for Corrata, Healy says that growing a company always involves trying to more things that you have the resources to do. “You also have to be more productive with the resources that you do have.
“Another key challenge for us now is hiring staff – the Dublin market in particular is dominated by large multinationals. We currently employ 12 people and we have been lucky to find the staff we have. As a smaller company, it’s difficult to break through the noise when you’re up against Google, Facebook and Microsoft. This challenge is not unique to us – it’s a challenge for all indigenous companies.”
Healy also notes that the startup landscape has changed significantly in Ireland since he started out with Xiam. “You can now sell software more quickly and you can deliver it using the SaaS model. We can get customers up and running in minutes, which was not the case in the old days with Xiam.
“Another key advantage is that we can choose now to go after the enterprise rather than telco market. The enterprise market has thousands of potential customers, whereas with telcos you have to go after the dozen or so big players globally. Instead of chasing whales, we can now work with smaller businesses, meaning deals can get done all of the time.”
Corrata’s most recent account filings are for 2018, when the company booked a loss of €481,000. The business had year-end cash of €310,000, debtor book value of €68,000 and balance sheet net worth of €269,000.
According to Healy, Corrata’s focus for 2020 is on expanding its partnerships. “The only way that companies like Corrata can grow in the enterprise space is through strong partnerships with larger organisations. We have some excellent partnerships in place already, including one with CWSI in Ireland, and communications providers Sprint and Granite in the US. Adding to these over the next 12 months is a critical milestone for us.”
Healy adds that establishing Corrata has been a steep learning curve, despite his experience in running and selling Xiam. Corrata has picked up a clutch of awards since launching, including European Cybersecurity Startup of the Year in 2018. For Healy, one of the lessons he has learned in business is that plaudits are fripperies where the bottom line is concerned.
“I learned that the only evidence you should rely on in terms of understanding whether you’re hitting the right spots for customers is if they buy your product. Product trials, people saying nice things about you, winning awards – this stuff is no evidence for people wanting to buy your product. The only measure of success is acquiring customers.”