After making a name for itself in an obscure field of networking technology, a Kanata firm is hoping a pivot to a higher-profile space and millions of dollars in new funding will help take it to the next level.
Corsa Technology was founded in 2013 to produce hardware used in programmable internet networks called software defined networks (SDN). The company quickly became a leader in the production of data planes – platforms for directing the flow of traffic on the internet.
In its first three years, Corsa landed more than $20 million in venture capital investment and gained a loyal base of customers, mostly in the United States and Europe. The company’s early promise secured it a spot on Deloitte’s list of Canadian Companies to Watch in 2015, along with other notable Ottawa success stories Klipfolio and You.i TV.
But since the beginning of last year, Corsa has shifted its focus. The firm has been investing heavily in a new series of products designed to help thwart cyber attacks, and in late June, it closed a Series-C round of new equity financing worth more than $9 million.
Investors in the latest round included Ottawa’s Celtic House Venture Partners, BDC Ventures and Toronto-based Roadmap Capital, all of which contributed to previous rounds, as well as a number of private individuals.
Corsa co-founder and CEO Bruce Gregory says the latest funding will help his firm deepen its talent pool and continue refining its new suite of security offerings. He says the latest quarter that ended June 30 was the best in the company’s five-year history, adding Corsa is on pace to become cash-flow positive within the next 18 months.
“We’re in a full-on press in bringing on sales and marketing talent and growing the business side.”
“That’s really what the funding is about is to help get us there,” Gregory says. “We’re in a full-on press in bringing on sales and marketing talent and growing the business side.”
As an SDN firm, Corsa’s annual revenues were in the “single-digit millions,” the CEO notes. But he thinks those numbers will jump significantly now that the company has diversified into cybersecurity, a sector with massive upside.
“It gives us the ability to accelerate on the business side,” Gregory says. “The time to significant revenue in that market is much (faster).”
Security products accounted for about 60 per cent of Corsa’s revenues in the latest quarter, he says, the first period in which the firm generated any significant sales from its new product line.
Gregory says he expects that share to rise as more and more organizations seek cutting-edge defences against increasingly sophisticated forms of cyber-sabotage such as denial-of-service attacks, in which hackers bombard networks with a flood of superfluous requests in an attempt to overload systems and shut them down.
Gregory says there’s a raft of sophisticated cybersecurity software on the market that can detect all kinds of potential threats but has no idea what to do about them. That’s where Corsa’s new hardware comes in.
Invisible to hackers
Dubbed Red Armor, it can be installed anywhere in a server network. Shaped much like a pizza box, the device can be programmed to react to potential threats detected by security software in several ways, halting the flow of traffic completely, redirecting it or slowing it down so the data can be analyzed to see whether it’s harmful and how it can be neutralized.
Company officials say only authorized users are aware of Red Armor’s presence, rendering it effectively “invisible” to potential hackers.
“It would be like Checkpoint Charlie, but you didn’t even know you went through Checkpoint Charlie,” says Corsa co-founder and vice-president of product management Carolyn Raab, likening Red Armor to the famous crossing point between East and West Berlin.
“We sit on any line in any network, and we are able to offer up a point in the network where the network operator and the security team together can control, watch, monitor, take action on any flow of traffic.”
The firm currently has 28 customers across all its product lines, about 85 per cent of them in the United States and Europe. Corsa has a small sales team based in the Washington, D.C., area, but most of its 30 or so employees are based here in Ottawa – where the calibre of engineering talent, Gregory says, is second to none.
Competition for such highly skilled workers is intense, he adds, but is still much more manageable than in many other tech hubs.
“The problem you have trying to grow a company like this in Silicon Valley, for example, is just the constant churn,” he explains. “The skillsets that we have in Ottawa, they’re still fairly unique as well – that combination of people that are very good at data communications, at chip design, at system design, the software to run those systems. Ottawa is one of the strongest centres in the world for that.”