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Scale Venture Partners - Portfolio News
ScanSafe's business brotherhood
Silicon Valley / San Jose Business Journal
By Alison R.G. van Diggelen
Friday, May 11, 2007

Feeling the need to create something themselves rather than advising for others, brothers Roy Tuvey, left, ScanSafe’s president; and Eldar Tuvey, CEO, co-founded ScanSafe Ltd., a Web security service.

The decision took place mid-Atlantic in 1999. Roy Tuvey was flying between London and Miami when he decided that his brother Eldar's business idea had potential; and it was time to join forces and make it a reality.

"By the time I landed, I decided, let's do it," says Roy Tuvey, the younger brother of the two-man team that co-founded Mailround Ltd., the precursor to ScanSafe Ltd., a Web security service company.

Today the 100-person business, with offices in San Mateo and London, processes over 6 billion URL requests and blocks 12 million Web threats a month for more than 1,000 international customers, including Rothschild, BMW and NEC.

Both brothers previously had promising careers at two of the largest investment bankers, (Merrill Lynch and Goldman Sachs respectively). But each had a drive to create something themselves; and grow from mere advisors to decision makers. Their father ran his own commodities trading company in London; entrepreneurship was in their blood.

"I was keen to have a creative outlet," adds Roy Tuvey. "I can appreciate art, music, literature, but am not skilled in them. I'm tone deaf. Business is my thing."

In August 2005, Roy Tuvey opened ScanSafe's Silicon Valley office, a strategic move that helped the company grow, since almost all of its technology partners are here.

"Of two potential partners, one is literally in our building and the other is across the street, about 200 yards away," says Dan Nadir, ScanSafe's vice president of product strategy. "We also benefit from the wealth of talent available in the Silicon Valley."

But how do the brothers make far-flung offices -- 5,000 miles and eight hours time difference apart -- operate seamlessly?

IM and conference calls are one key that helps them make decisions in real time. Both brothers try to be available virtually 24/7.

The ebullient Eldar Tuvey says it's sometimes difficult to work with his brother since they have a lot of history; however they both agree the positives outweigh the negatives. Trust is a big issue -- there are no hidden agendas, and Eldar Tuvey says that when working with a brother, "You know what they're thinking."

The two confess that they were fiercely competitive in sports as youngsters, but declined to share war stories. They do recall a chess championship where were head to head in the final. Who won in the end?

Eldar Tuvey keeps mum, while Roy Tuvey shrugs, "It must have been a draw."

Today, the two still cover for one another and complement each other's business strengths, says Dan Nadir, ScanSafe's VP of product strategy.

"There is no 'I can do it all' mentality," says Nadir. "The company benefits by having each one take on projects or activities that play to his strengths."

Eldar Tuvey's passion is increasing the company's visibility; whereas Roy Tuvey uses his business savvy to build strategic partnerships, especially with blue chip companies like AT&T and Postini (a managed e-mail service provider).

Mailround, the company the Tuvey brothers started in '99 was an e-mail ad service, but it was the painful security issues they experienced in that business that led them to seek better security solutions. The brothers tried adopting a piecemeal approach, but since all the company's traffic was coming through its offsite servers, they asked: why can't we deliver complete Web security as a service?

"The idea was against conventional wisdom: creating an offsite service that wouldn't slow things down," says Roy Tuvey. Both brothers praise their CTO, John Edwards, who has been with them from the beginning.

ScanSafe was founded in 2002 and today its service, priced at between $2 and $10 per user per month protects company networks from spyware and viruses; and limits company liability by filtering out inappropriate content (gambling, adult content etc.) and preventing it being accessed and shared around the office.

Instead of offering security software or hardware like its giant competitors, McAfee and Symantec, its on demand service drives all customers' Web traffic through its data center for scanning and filtering.

Jerry Maze, chief information officer at Royal Food Services in Atlanta has been using the ScanSafe service for 12 months and likes the central control it gives him. He says that it was becoming a nightmare to keep his staff's desktops running efficiently; they were so loaded with adware and spyware.

"ScanSafe gives us a fine filter capability that vastly simplifies my management system," says Maze. "Websurfing is a big time waster; now I can see who's going where on the Web and limit porn, hate stuff etc."

"We've pioneered this space," says Eldar Tuvey. "We have a chance, a slim chance, to change the way that security is being done."

The challenge comes in staying ahead of the competition; and Roy Tuvey admits that, despite its patent pending technology, several companies are looking at the space, especially after ScanSafe's spate of awards.

In March, the company was named a "Cool Vendor in Infrastructure Protection" by analysts Ray Wagner, John Girard, Peter Firstbrook, John Pescatore and Neil MacDonald of Gartner Inc., for its contribution to technologies addressing real-world security needs. This month it won the SC (Secure Computing) Magazine Reader Trust Award and a CODiE Award.

ScanSafe delivered the first successful secure Web gateway service -- something that telecom has been promising for years," says Gartner's Peter Firstbrook, but he acknowledges that the company will face increasing UK-based competition from Black Spider Technologies -- a unit of SurfControl plc -- and MessageLabs Ltd. as well as from telecom providers.

"The market is exploding and the secret is out," says Tuvey, but adds that he's surprised it has taken the competition this long.

Meanwhile, the company continues to try to leverage its experience to stay ahead. Scandoo, a new feature of ScanSafe, was founded last year in response to Roy Tuvey's desire to share a clip of a memorable hockey goal with friends, without downloading malware.

"Scandoo works seamlessly with Google (or other search engines) to find dodgy Web sites," says Tuvey.

A Web search using Scandoo.com flags Web sites with viruses or unsavory content; and the free service not only demonstrates what the company can do, but helps it generate an aggregate premium data set to improve its security service and publish its monthly Global Threat Report.

The company is privately held, with a total of $25 million funding from Benchmark Capital and Scale Venture Partners.

"The Tuvey brothers are on top of a great trend and are maniacally focused on being successful," says Rory Driscoll, managing director at Scale Venture Partners. "With driven entrepreneurs there's less need to hold hands and sing Kum ba yah."

Although the brothers wouldn't reveal specific revenue numbers, Roy Tuvey says revenue grew by 130 percent and ScanSafe's customer base grew by 110 percent in 2006. He anticipates similar growth again in 2007.

While not technically profitable (it's reinvesting in its global network), Roy Tuvey says the company has a "high margin business model."

And what of the future? Do the brothers anticipate an IPO or selling the business any time soon?

"Investors want a return on their investment," says the financial mastermind, Roy Tuvey. "The best way to do that is focusing on getting our heads down and growing the business."

Alison R.G. van Diggelen is a writer based in San Jose.



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