Tomorrow's Technology Innovation

Tomorrow’s Technology Innovation, Today’s Work at Safeguard

Posted by | January 24, 2014

Revolutionary changes in industries like healthcare would never be possible without new information technologies, one of Safeguard’s sweet spots dating back to our early days when we were nurturing and developing companies like Novell, CompuCom, QVC, Cambridge Technology Partners and ICG.

Sweeping innovations such as big data, cloud computing and Software as a Service (SaaS) are now being used in ways unimaginable a few decades ago. They support a highly mobile workforce and spur productivity across every level of the enterprise.

As Safeguard Advisory Board member Steve Friedman tells it, “The intersection of cloud, mobility and security has created huge opportunities for nimble companies that can develop the applications that securely allow workers and customers to access data on public and private clouds anytime, anywhere, on any device. Desktops are being replaced by mobile devices at a record pace, freeing the enterprise to take its business anywhere the market demands. These market forces are creating a real need for solutions that assure the reliability and security that enterprises depend upon to do business.”

AppFirst, a Safeguard partner company, is a case in point. Its application aware operational intelligence platform, which provides “in process” data collection, cloud-based big data analytics and dynamic dashboards, allows companies to easily and conveniently monitor and optimize application performance in real time. This averts costly downtime, which can be crippling.

Friedman particularly likes AppFirst’s ability to provide unified visibility across a company’s IT ecosystem, providing a unique view of the intersection of every application and the resources they are using. “Uptime has now become the actual bottom line for companies that earn their keep by staying connected. And AppFirst clearly has an elegant solution for managing and assuring optimal systems performance, which in today’s world is synonymous with business performance.”

In FinTech, another area in which Safeguard has deployed capital, new market realities have created an entirely different set of challenges and opportunities.

As Jim Ashton, another member of our Advisory Board, explains, “Large financial services companies were hit hard by the financial meltdown, and no longer have the discretionary dollars to invest in speculative innovation. They want technologies that are proven to improve customer service or help differentiate themselves from their competition. Fortunately, the advent of cloud computing and crowdsourcing is now allowing small, innovative technology companies to compress development time—going from prototype to market-ready application in months, rather than years.”

That nimbleness represents a major opportunity for Safeguard. One example is Safeguard’s partner company Lumesis, a financial technology company that helps identify risk in the fixed income markets, specifically muni-bonds. Its solution couldn’t come at a more opportune time.

For example, with Detroit filing the largest municipal bankruptcy in our country’s history last year, the ability to identify other potential municipal meltdowns is an urgent issue among analysts and credit and risk managers in the bond market. Safeguard has deployed $4.0 million in Lumesis since February 2012 and has a 44 percent primary ownership position.

“The relatively small deployment of capital illustrates newfound efficiencies that can allow small companies to come to market more quickly with proven solutions to meet timely needs,” says Ashton. “Deals like these offer Safeguard a route to increasing its number of partner companies, a smart objective that improves the prospects of more regular exits and provides excellent balance given current market conditions and opportunities.”
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