Here's how Microsoft's chairman is fighting hackers
Microsoft (MSFT) Chairman John Thompson spent a decade at the helm of security software developer Symantec (SYMC). Since he stepped down in 2009, cyberthreats have gotten significantly more sophisticated and pervasive, which helps explain his latest bet.
Contrast Security, a Silicon Valley start-up whose software protects applications from attack, said Wednesday that Thompson joined a $16 million investment in the company. The deal was led by venture firm General Catalyst Partners.
Founded in 2014, Contrast was designed for a new era of software development. All types of companies — banks, retailers, automakers — now employ developers who are writing code, sharing it with co-workers, and pushing it to any number of devices and servers. Every step of the way that code can be corrupted by hackers.
Contrast is deployed at the beginning stages of software development to keep the bad guys out throughout the whole process. On the other side, the start-up's products can be used by companies that are constantly using new apps and programs, which all need to be vetted and monitored to make sure they don't contain malicious code.
"We've got to start to rethink the application security paradigm, not just the information security paradigm," Thompson said in an interview. "There have not been a lot of ideas that have emerged in that domain."
Security breaches are getting more frequent and extreme, seemingly by the day. Yahoo (YHOO) said last week that 500 million customer accounts had been stolen, marking potentially the biggest hack in history.
In response, companies and governments are expected to spend $202 billion a year on cybersecurity tools by 2021, up 66 percent from this year, according to research firm MarketsandMarkets.
Thompson, who ran Symantec from 1999 to 2009 and remained as chairman for another two years, joined Microsoft's board in 2012 and spearheaded the search for Steve Ballmer 's successor as the software company's CEO. Ultimately, Satya Nadella was promoted to the top job in February 2014, and at the same time Thompson was named chairman of Microsoft's board.
Since leaving Symantec, Thompson has invested in about 20 start-ups in security, storage and data analytics. He was also CEO of performance analytics start-up Virtual Instruments from 2010 until earlier this year. His tenure there ended in disappointment when Virtual Instruments hit a growth roadblock and merged with Load DynamiX in March.
Thompson brings obvious security expertise to Contrast. But his role at Microsoft could also be beneficial.
All apps are moving to the cloud, where they're typically hosted by big infrastructure vendors like Amazon (AMZN), Google, IBM or Microsoft. Amazon Web Services is by far the market leader and currently the only one that counts Contrast as a formal partner.
Contrast CEO Alan Naumann said there are four to five cloud vendors, including Microsoft's Azure service, that would make for natural partners.
The company also teams up with services like corporate chat providers Slack and Atlassian's (The Stock Exchange of Thailand: NETBA-TH) HipChat, because those are popular tools for developers in collaborating and communicating. Contrast wants to be wherever developers are working.
"The deployment model is to give a copy for every developer and every application," said Naumann. "Our tech goes everywhere the app goes."
Contrast is still in its early days, but the company has signed up more than 60 clients, Naumann said. He wouldn't give Contrast's exact head count, saying only that it has 50 to 100 employees and plans to quickly double.
That was all more than enough to get Thompson excited.
"I would've loved to have put in more money than where I ended up," he said.
