Big Privacy: The Era of Big Data has led to Greater Demand for Privacy from Consumers and Businesses Alike

04.07.15
Features

The dominance of big data and the ease with which digital information is obtained have resulted in fundamental transformations regarding how businesses operate and consumers lead their lives.  While the demand from consumers for information privacy and security has continued to increase, digital networks, businesses and government entities have simultaneously upped their efforts in obtaining more detailed personal information to strengthen their customer targeting and, in select cases, their ability to monitor individuals’ day-to-day activities and communications. Regardless of whether or not the collection of this data is carried out by a business just trying to increase their top line, an eavesdropping government or a hacker interested in using the data in more malicious plans, consumers and businesses alike are demanding privacy protection in rapidly increasing numbers to ensure the integrity and safety of their information and the networks on which it is stored.

Steve Jobs stated that “privacy will be the defining technology theme of the next decade,” and recent headline data breaches at some of the worlds’ largest corporations have only reinforced that notion with some cases reaching epic proportions.  The data breach involving Target during the 2013 holiday season violated the personal information of approximately 70 million people; and in 2014 an estimated 500 million online accounts were hacked across the globe. Businesses’ desires to prevent these major catastrophes as well as consumers’ demand for increased privacy have led to significant attention and investment in the space.

Entrepreneurs have identified certain solutions to the various problems associated with data and information that are neither private nor secure – the majority of which is generated via browsing the internet.  Targeted online advertising via social media pages and search engine results stem from information tracking, and services like AdBlock have been able to take advantage of increased demand in content filtering.  To date, AdBlock has amassed a base of over 150 million users across web browsers and devices.  Further evidence that the desire for information to remain anonymous is here to stay is the widely popular Tor Project which led to the creation of an anonymous, private internet.  Tor is free software on an open network that defends users against web traffic analysis and has seen over 100 million installs.  Also closely related, the creation and rapid increase of use of cryptocurrencies like Bitcoin and Ethereum shows how the demand for anonymity is quickly influencing industries outside of everyday internet browsing such as financial services.

Increased demand in the security and privacy of digital information and data has profoundly impacted software providers and e-commerce businesses alike.  CipherCloud, founded in October 2010, is one company that provides cloud information protection, enabling organizations to securely adopt cloud applications by overcoming data privacy, residency, security, and regulatory compliance risks.  Since its founding, CipherCloud has experienced tremendous global growth: over 2.5 million business users around the world have adopted the CipherCloud technology across ten industries. The company’s open platform delivers security controls like encryption, tokenization, data loss prevention, and cloud malware detection.  The company has raised over $80 million in venture funding since 2011, including most recently a $50 million Series B round in November 2014 from investors Andreessen Horowitz, Delta Partners Capital Limited, T-Venture, and Transamerica Ventures.

Also operating in the cloud security and privacy space is nCrypted Cloud, founded in 2012.  Their solution to the data security problem focuses on the privacy of personal and corporate data residing in the public cloud as well as sync services like Dropbox and Google Drive that have become so ubiquitous in the past few years.  nCrypted Cloud prides itself on providing a brand new ability to share data securely and collaborate with anyone, across security domains, without limiting the content creator’s full control over who can access their data.  This innovative solution has attracted interest among growth equity and venture capital investors.  To date, nCrypted Cloud has raised $9.3 million from the likes of Maxfield Capital as well as Microsoft, Cisco, Broadcom, and Reveal Imaging Technologies.

Disconnect is another company operating in the online security and privacy software space.  Disconnect’s goal is to put people in control of their personal data and enable them to keep all of their online activity private. It does so through a unified suite of mobile and browser-based solutions that identify, visualize, and block invisible websites that track users’ personal and business data.  It allows users to encrypt all of their activity, see who is tracking them, block malware and keep their searches private. Disconnect has seen rapid adoption with over 3 million users since its 2011 founding and over $4 million of funding from Highland Capital Partners and FirstMark Capital.

Businesses and individuals also desire that the sharing and transfer of data and digital messages remain private and protected.  Also founded in 2011, Wickr provides the ability for any user to send fully encrypted messages that cannot be traced even by Wickr’s own servers. Wickr most recently closed a $30 million round in June 2014 from Breyer Capital, CME Group, Knight Foundation, and Riverwood Capital, among others.

With major data breaches of personal and business data as well as increasing public concern over the surveillance capabilities of governmental organizations, there has been a profound increase in demand for privacy and security software platforms.  Both businesses and individual consumers alike desire for their personal information, data, and digital activities to remain secure, private, and protected. Entrepreneurs understand that this vast problem can be combated with an array of effective technology solutions, meanwhile investors are eager to put their investment dollars to work and capitalize on the still nascent digital security and privacy space.

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