01 May This company wants to build commercial cyber startups in Maryland
Baltimore Business Journal | Apr 28, 2017 | Morgan Eichensehr
Maryland has plenty of cyber companies, but very few of them are commercial operations. Data Tribe, a Fulton company, is trying to fix that, building commercial cyber companies through a combination of incubation and venture capital expertise.
Mike Janke, former CEO of cybersecurity startup Silent Circle, and a team of other entrepreneurs with backgrounds in cyber and venture capital are seeking to capitalize on the technology and ideas coming out of local cyber labs. Instead of creating a typical venture firm or a normal incubator to help build up that cyber entrepreneurial ecosystem, the DataTribe team created a kind of hybrid operating company.
The cyber ecosystem here is heavily government-driven .The Maryland and Washington, D.C., region has over three times more cyber engineers than the rest of the country combined, Janke said. But of the about 800 cyber companies in the area, only eight are purely commercial companies, selling products and services directly to customers. The rest are largely focused on government and contracting, he said.
“You don’t have the same ecosystem here of people that have done multiple startups, exited and built other companies, like you do in Silicon Valley,” Janke said. “We wanted to see more of these companies on the commercial side of cyber.”
DataTribe selects and coaches cyber startups, as an incubator would, and also provides seed financing of up to $1.5 million, like a venture firm. It will also contribute additional funding for each company when it launches an official Series A investment round. The startups are hand-selected teams of cyber professionals recruited from the National Security Agency and other local research labs.
“A lot of things researchers are working on in these government contexts are three or four generations ahead of anything that is commercially available today,” Janke said. “We want to leverage those teams and help them develop technology to introduce to the commercial market.”
Currently, DataTribe houses three fully-staffed startups at its headquarters in Fulton, with two poised to raise Series A rounds within the next couple of months .As teams cycle through – they stay in incubation for about 10 months to a year -and go off on their own, new cyber startups are chosen to replace them, and the building process restarts. The first startup to successfully exit DataTribe’s program was Dragos, an cybersecurity firm founded by experts from the U.S.intelligence community .
DataTribe builds on the experience of its 11 staff members and executives, including Bob Ackerman , founder of Silicon Valley-based cyber venture firm Allegis Capital, and Steven Witt, former CEO of cyber startup Onyara, which sold for $40 million in 2015.
“We don’t want to be just a group of advisors or just the people writing a check,” Janke said. “It’s the whole package. We’re a very different beast .”
Morgan is a reporter for the Baltimore Business Journal. She covers technology, education and health care.