Fredericton-based Beauceron Security has seen its annual recurring revenue increase by 60 percent in 2020, buoyed by more aggressive cyber-criminals and the specialized security needs of companies relying on remote work.
CEO David Shipley said in an interview that Beauceron’s growth has suffered only minimal disruption during the pandemic, with overall revenue rising 95 percent this year. And a new sales frontier has opened up in the form of healthcare service providers.
“It’s absolutely not the year we planned for,” he said. “But we’ve managed to persevere for the most part and thrive in other parts.”
Beauceron sells enterprise software that trains employees to recognize and avoid cybersecurity threats that rely on poor security practices and “social engineering” -- behavioral manipulation techniques, such as phishing emails.
Verizon’s 2020 Data Breach Investigations Report found that almost half of all hacking incidents worldwide that resulted in data breaches were attributable either to social engineering or user error.
The Beauceron software can also confront employees with simulated social engineering attacks to track whether they recognize the danger, flagging workers who prove themselves easily manipulated. Workers are given regular feedback on their performance, “gamifying” the process to keep them engaged.
Beauceron sells to large clients directly, and to small and medium-sized businesses via channel partners.
As COVID-19 has forced many companies to move their staff out of offices and into remote work arrangements, Shipley said businesses have been keen for help managing the risks associated with the new paradigm.
In office environments, IT teams can control which devices employees use for work and who connects to company networks, making computer systems less easily hacked. But the rise of remote work has made such precautions harder to enforce.
And when employees are already stressed by COVID-19 and the recession, Shipley added, their judgment is often impaired, making them more susceptible to social engineering.
“People are more vulnerable when they’re in a heightened state of fear, anxiety and exhaustion,” he said. “So that’s the relationship with the pandemic. . . . The general grind of this thing has worn people down and made them more vulnerable.”
For many businesses, the dangers posed by the work-from-home economy have spurred decision-makers to accelerate their purchasing timelines for security services, including those sold by Beauceron.
Also driving demand for protection from social engineering attacks is a shift in the behavior of for-profit hackers, who previously targeted technologically unsophisticated businesses with the aim of extracting either money or sensitive data.
Now faced with the same harsh conditions impacting the rest of the economy, many hackers have turned their attention to more ambitious, lucrative targets, such as municipal governments and hospitals, Shipley said.
Beauceron has inked a deal to provide its software to a major Canadian healthcare services company. Shipley was not permitted to name the organization, but said Beauceron has used its feedback to develop customized educational content in both English and French.
The new content, which Shipley said marks the beginning of a major expansion into the healthcare sector for Beauceron, is meant to address areas of particular vulnerability for medical professionals. For example, he said the stereotype that doctors tend to be affluent can sometimes be used as a manipulation tactic.
“We’ve developed learning and education and messaging for doctors that talks about the fact that they’re a target not just because of the information they have access to, but because of perceptions of the relative wealth of physicians,” said Shipley. “So it really helps them to understand how their role in society shapes how criminals see and act against them.”
Key to Beauceron’s appeal, Shipley said, is that its offering is cheaper and faster to implement than software that aims to prevent hacking through purely technological measures.
Shipley said his company now has more than 240 clients with more than 400,000 individual users across North America and parts of Europe.
Next on the horizon for Shipley’s 26-person team is a revamp of the platform that will incorporate more extensive artificial intelligence features to differentiate Beauceron from its key competitors, Florida-based KnowBe4 and New York’s Cogency Global.
Beauceron has not raised capital since it closed a $1.5 million round in 2018, and Shipley is on the lookout for potential strategic investors for a possible future round.
“We’re in a fortunate place where ... we’ve been incredibly capital efficient with the money that we’ve raised to date,” he said. “We’re in talks with a few parties about when and how a raise will make sense.”