Clearswift Update

We've just been briefed by Clearswift's new COO, Andrew Wyatt. It's always a pleasure to hear from this firm. We have known them since 1995, when Content Technologies (the company that originally developed MIMEsweeper) became a client.

The technology has taken a lot of battering over the last 10 years. First it was bought out for $1 billion by Baltimore Technologies. We are not normally given to hyperbole, but in this case will make an exception. YES, AN INCREDIBLE $1 BILLION!!! This was at the height of the boom in 2000. The acquisition and its price made no real sense, but the price was naturally irresistible for the selling stockholders. The Baltimore merger was a great distraction.

In 2002 the technology was bought by NET-TEL, an X.400-based messaging firm, for a suitably post-crunch sum vastly less than $1 billion. The MIMEsweeper part of NET-TEL's business was by far the most important, but the new owners took a long time to get fully behind their acquisition. That did further damage. Along the way, NET-TEL renamed itself Clearswift.

For the last three years, Clearswift has been focusing hard on its core MIMEsweeper business. Despite the numerous distractions of the last decade, many MIMEsweeper customers have stayed in the fold, so there's been a reliable revenue stream. MIMEsweeper and Clearswift’s new Web and Email Gateway products are quite sticky, because of investment customers make in their custom-policy definitions. The main message we hear now from Clearswift is: "Content inspection is our core business and we're 100% committed to it."

Product line summary:

  • Scans Web and email data streams
  • Scans for spam, viruses, spyware, other malware
  • Powerful and highly recursive policy definition language (mainly boolean logic plus regular expression matching) used, among other things, for compliance and data loss prevention
  • Policy-based encryption, either through strong encryption or by standard password-based ZIP files
  • Plenty of compliance filters provided
  • Policy management system works across both Web and email channels

The technology is sold into organizations of all sizes, including very large ones. Nevertheless, its greatest success is with medium-size organizations, with 100 to 3,000 employees. As you'd expect, the company sells a lot through value-added channels, and has invested significantly to build out its channel and support programs.

Clearswift doesn't disclose its revenues. Ferris Research estimates these at $40 million annually. A series of venture fundings allowed Clearswift to invest ahead of revenues for an extended period. We're glad to learn that the company was profitable for the second half of the last fiscal year and plans to be fully profitable this year.

... David Ferris

One Comment

  1. Posted July 30, 2010 at 9:45 AM | Permalink

    Nit picky correction: MIMEsweeper was actually developed by a UK firm called Integralis, MIMESweeper was split out to create Content Technologies.

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