Many startups grow by gobbling up competitors or by becoming part of a bigger company. Austin, TX-based SailPoint is pursuing a strategy that allows it to do both.
On Wednesday, the maker of identity management software announced it sold a majority stake to Thoma Bravo, a private equity firm located in Chicago and San Francisco. Terms were not disclosed but Mark McClain, SailPoint’s CEO and founder, says the deal came about as his firm was looking for investment to fuel growth.
“In this way, the early investors have the opportunity to cash out; they’re eight to nine years in their investment,” he says. “Thoma Bravo has a strong track record … they can use their very big checkbook to build the company quickly.”
The remaining SailPoint shares post-cash out were divvied up to company employees. “We want to retain people and keep people motivated,” says Kevin Cunningham, the company’s founder and president.
Think of identity management and ID theft is what comes to mind. These are the hackers and phishers who grab headlines as they steal credit card or bank account numbers, such as the so-called CyberVor attack during which it is believed that a Russian criminal gang unlawfully obtained 1.2 billion usernames and passwords, calling into question the authentication protocols of some of the world’s most popular business websites.
But another facet of identity management relates to the internal controls businesses have over which employees, contractors, or vendors have access to which information at the company. “Whatever authentication you choose, what we do is set things up correctly so that, within that system, the right people are getting to the right data,” McClain says.
As more and more business is done via the cloud or on mobile networks, it becomes even more important to secure access. The ubiquity of software as a service and the layering on of new applications further complicates this. Companies do not want to be the next headline, Cunningham says.
“There is also a business agility aspect,” he added. “You want to make sure you’re making the system available to people who legitimately need it to do their
