Equity Firm Acquires Purdue-Founded Company
A software security company co-founded by members of the Purdue University Computer Sciences Department has received a majority investment from a global private equity firm. TA Associates has pumped money into Arxan Technologies Inc., which is based in Maryland but has an office in West Lafayette. The company was launched in 2001 and has received support over the years from the Purdue Research Foundation-managed Trask Innovation Fund and the university's Center for Education and Research in Information Assurance and Security. October 6, 2013
West Lafayette, Ind. – Arxan, an application security company specializing in software protection, was recently sold to TA Associates, one of the largest private equity firms.
Founded by members of the Computer Science Department and two entrepreneurs in 2001, the company grew out of efforts by Professor Mikhail (Mike) Atallah, his graduate student, Hoi Chang, Professor John Rice, and Assistant Head Tim Korb, working together to develop the technology for a business that grew into one of the leading providers of software security solutions.
The technology protects from attacks in distributed or untrusted environments and is used in more than 200 million computing devices, providing protection from hackers by linking “guards” at different points within software code.
“The idea started with Mike and Hoi and evolved into regular meetings to refine the technical ideas. We all met for at least two years, before deciding to go commercial. We received our first major venture capital shortly after September 11. We knew that flying to Boston to do a presentation for our investors was going to be very difficult at that time, so we all piled in a van and drove,” Korb said.
Purdue supported their efforts with the Trask fund and also paid for the legal expenses of the patents. “Purdue was very helpful, providing some initial funding, filing for patents, renting to the company its initial space at the Research Park under advantageous conditions, and eventually licensing the technology to the company. Before Arxan was founded in 2001, both the CS Department and the CERIAS center provided facilities for research, and an environment conducive to generating the results that were eventually licensed to Arxan. After Arxan was founded in 2001, Purdue also gave us the flexibility and encouragement to pursue this venture,” Atallah said.
The ultimate decision to sell Arxan was driven by the board of directors, with regard to market conditions. Atallah added, “The recent rapid growth of mobile computing gave a boost to Arxan, because mobile devices are so easily compromised and we were positioned to protect the apps in such situations.” Both Atallah and Korb will continue to serve on the technical advisory board, along with Professor Eugene Spafford, who is also the founder and director for the Center for Education and Research in Information Assurance and Security (CERIAS).
TA Associates was founded in 1968 and is one of the largest global, middle-market growth, private equity firms in the world. The firm has invested in more than 430 companies and has raised $118 billion in capital with offices in Boston, Menlo Park, London, Mumbai, and Hong Kong. TA leads the world in buyouts and minority recapitalizations of profitable growth companies in technology, financial services, business services, health care and consumer industries.
Source: Purdue University
BOSTON, September 18, 2013 – TA Associates, a leading global growth private equity firm, today announced it has completed a majority investment in Arxan Technologies, Inc., a leading provider of software security solutions. Terms of the investment were not disclosed.
Arxan's comprehensive product suite offers a full range of application security solutions. The Arxan solutions, designed to withstand persistent and sophisticated attacks launched across mobile, desktop, embedded and server-based environments, secure applications by “hardening” them against hacking of all types such as tampering, piracy, reverse engineering, malware insertion and key discovery. Arxan serves Fortune 500 and other commercial clients around the world in a variety of industries, including financial services, digital media, gaming, healthcare and software. Founded in 2001, Arxan is headquartered in Bethesda, Maryland.
“Companies deploying mobile applications require deep and comprehensive application protection solutions to fully secure both customer and enterprise data,” said Elizabeth de Saint-Aignan, a Principal at TA Associates who will join the company’s Board of Directors. “Over the course of more than 10 years, Arxan has developed a suite of application security solutions that many consider the industry’s most advanced, sophisticated and proven technology. We are pleased to complete this investment and look forward to helping further strengthen Arxan’s position in a rapidly growing mobile security market.”
“Having a partner committed to working closely with our team to support Arxan’s long-term growth is of the utmost importance,” said Michael Dager, CEO and Chairman, Arxan Technologies, Inc. “TA Associates has an extensive history investing in the IT security industry that we find quite attractive. TA will play a central role in helping us further solidify Arxan’s position as a global leader in protecting the integrity of applications across all devices and industries.”
“Companies increasingly understand that compromised software applications can negatively impact revenue, reputation, intellectual property and user experience, and expose an organization to fraud and legal liability,” said Kenneth T. Schiciano, a Managing Director at TA Associates who will also join Arxan’s Board of Directors. “As the mobile application market continues to grow, so too will the number of high-severity threats, particularly for the most successful platforms and applications. Arxan is among the few providers offering truly broad and robust cross-platform security solutions and we see significant continued opportunities for the company.”
Goodwin Procter LLP provided legal counsel to TA Associates. Cooley LLP served as legal counsel and America's Growth Capital, LLC served as financial advisor to Arxan Technologies.
About Arxan Technologies
Arxan Technologies protects the app economy from attacks in distributed or untrusted environments with the world's strongest and most deployed application integrity protection products. Among today’s diverse computing platforms, mobile, embedded or packaged software are all exposed to hacking attacks such as reverse-engineering, tampering, insertion of malware/exploits, repackaging, fraud, intellectual property theft and piracy. Arxan's patented Guarding technology enables applications to proactively guard their own integrity by defending, detecting, alerting and reacting to hacking attacks through a risk-based, customized protection. The company’s self-defending and tamper-proof applications are deployed on more than 200 million devices by leading Fortune 500 organizations in high-tech, ISV, financial services, digital media, gaming, healthcare and other industries. Arxan is headquartered in the United States with global offices in EMEA and APAC. To learn more about Arxan, visit www.arxan.com.
About TA Associates
Founded in 1968, TA Associates is one of the largest and most experienced global middle-market growth private equity firms. The firm has invested in more than 430 companies around the world and has raised $18 billion in capital. With offices in Boston, Menlo Park, London, Mumbai and Hong Kong, TA Associates leads buyouts and minority recapitalizations of profitable growth companies in the technology, financial services, business services, healthcare and consumer industries. More information about TA Associates can be found at www.ta.com.
Source: TA Associates