- Brian recently joined Bell2Bell’s Stuart Smith in a podcast episode in which he discussed his and the company’s background, motivation to found SideChannel, existing market opportunities, 2022 milestones, and plans for 2023 and beyond
- SideChannel, a provider of cybersecurity services and products, helps mid-market companies simplify cybersecurity
- The company was founded in 2019 after CEO Brian Haugli observed a business opportunity in the largely underserved market
- Over the years since, the company has grown, posting $4.8 million in revenue in 2022, up from $2.8 million in 2021
During his stints at the US Department of Defense (“DoD”) and Pentagon, and later upon entry into corporate America, Brian Haugli made an observation: US Government agencies and, crucially, large American corporations, relied on mid-market companies, innovative startups, and smaller organizations for important products and services. This reliance often meant that the security posture of the large companies and government agencies ultimately depended on the security posture of the smaller partner firms that had access to critical data. Unfortunately, cybersecurity products at that time were predominantly targeted at major enterprises, meaning most small and mid-sized businesses (“SMBs”) could not afford them. This left an underserved market and a massive business opportunity that SideChannel (OTCQB: SDCH) intended to capitalize on when it launched in 2019.
At the helm of the then-new startup was Brian, who now serves as the company’s CEO. To ensure success, he surrounded himself with an executive team comprising people who also saw the existing gap, liked the business model he put together, and wanted to join him on the mission to building a program dedicated toward mid-market and small businesses, a market that is still underserved to date. And the journey has been, as he described in a recent interview with Bell2Bell’s Stuart Smith, “amazing.”
As part of the interview, Brian provided more information about the company’s evolution from its inception, touching on his and the company’s background, motivation to found SideChannel, existing market opportunities, 2022 milestones, and plans for 2023 and beyond (https://ibn.fm/nOytd).
“Our job is to make cybersecurity simple and accessible. We are a cybersecurity firm with products and services, and we bring a wealth of experience from our collective backgrounds,” explained Brian. “Our focus is to bring real cyber security expertise, solid products and services, tech-enabled services into the types of companies that usually can’t actually afford full-time resources [and] the right types of resources. So, we’re predominantly focusing on the middle market and startups, and it’s been an underserved market.”
SideChannel, through its collective of expert virtual Chief Information Security Officers (“vCISOs”), builds and leads cybersecurity programs exclusively for SMBs. The vCISOs are attached to client companies where they own the cybersecurity budget, choose the right technological products for their needs, participate in hiring engineers and architects to deliver and execute within the cybersecurity programs, build the right processes, report to leadership about the goings on, and manage the programs over the long term. This long-term approach, according to Brian, sets SideChannel apart from the competition, which mostly only focuses on using technology to identify attacks or merely undertaking short-term assessments.
Coupled with the increased uptake of cybersecurity solutions due to the growing need by companies to protect themselves from cyberattacks and comply with cybersecurity regulations, this approach has contributed to tremendous growth for the company. In 2021, for example, SideChannel reported $2.8 million in revenue, a figure that grew to $4.8 million in 2022. And as a continued testament to the growth, the company is hiring more CISOs and people on its sales team as well as developing new services that best suit its client’s needs. “In February, we will post our [Form] 10Q, and you will see this rise and growth,” Brian continued.
The fiscal year 2022 saw the company not only post revenue growth but also announce the development of Enclave, a proprietary software product designed to provide network segmentation. According to Brian, this product creates an inventory of the assets within a networked environment, documenting everything that needs protection. It then isolates the various components that make up this environment, cordoning off attackers and helping reduce the damage an attacker can inflict on a system.
“We [created and launched Enclave] because we had a client base that told us this is what they needed. We did it because we knew that [asset inventory and segmentation of networks are] top controls to be addressed inside of all cybersecurity standards that are out there and frameworks that companies follow,” explained Brian. “And then, the products that are available in the marketplace are predominantly built for just the enterprise, which means the midmarket cannot afford the solution that everyone is saying they should be going for, and we are seeing people need.”
SideChannel expects to begin recognizing revenue from the Enclave product during the fiscal year 2023 (https://ibn.fm/vaH81). Still, the company also anticipates incorporating new features and capabilities into this product in addition to developing and launching other products to address systemic gaps that prevent mid-market clients from finding the right products.
The company also intends to evolve and develop its M&A strategy, which will see it bring under its umbrella operations that were previously outsourced to partners. “So, areas that we traditionally went to partners for, we will either be able to build those capabilities ourselves or acquire those capabilities or other resources from those partners and bring those in,” said Brian. “We are becoming Cybersecurity-as-a-Service for companies, and for us to have all those capabilities [under one umbrella], it gives our clients a one-stop-shop to [access] all these functions.”
And with companies increasingly recognizing the need for their vendors and B2B clients to safeguard their security posture, SideChannel is primed to articulate this need and manage that narrative to its customers’ customers.
“It is a niche. It is an area that is growing, and to date, I cannot say I have seen anybody else doing what we are doing, which is [exciting]. But we see a lot of other folks out there trying to do something similar, and we are beating them on capabilities and value,” Brain continued. “So, it tells me that there is an expanding need for this – we are not the only game in town. But it also tells me that we are doing it the way clients are looking for, not just reselling the product or some service out there. We are really bringing a lot of value to our clients, which they recognize.”
To listen to the full interview, please visit https://ibn.fm/xqvoJ
For more information, visit the company’s website at www.SideChannel.com.
NOTE TO INVESTORS: The latest news and updates relating to SDCH are available in the company’s newsroom at https://ibn.fm/SDCH
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