FireMon, a solution provider spinoff, sold to VC

Firemon founder Gary Fish

Firemon founder Gary Fish

Channel entrepreneur Gary Fish is showing yet again that he has the Midas touch: His creation, security intelligence software vendor FireMon, received a majority stake investment from Insight Venture Partners, effectively taking control of the company as sales momentum increases.

Specific terms of the deal were not disclosed. However, FireMon, spun off security integrator FishNet Security nearly eight years ago, has  reported steadily increasing sales traction. In the first quarter of 2013, for instance, its sales grew 120 percent as the company expanded globally and capitalized on renewals to expand customer engagements.

FireMon’s founders and management team will stay on with the company. Fish will remain as executive chairman, retaining a strong presence in management and business development. CEO Jody Brazil will remain in his leadership role. The company says customers and partners will see no substantive change in strategy, operations, product development or technology relationships.

“This new investment by Insight Venture Partners will enable FireMon to accelerate our plans to solidify network security intelligence as a cornerstone in the global cybersecurity market, and further establish FireMon as the technology and market share leader in this critical space,” said Fish, in a statement.

FireMon is a true Cinderella story in the channel. The company started out as a professional services tool developed in-house by FishNet to automate the analysis of firewall rulesets. Over time, FishNet continued to develop the tool to the point where it became a robust application for diagnosing and optimizing enterprise firewall rulesets and configurations. FishNet spun off the FireMon tool initially under the name “Secure Passage.” As the company solidified, it changed its name to the product name.

Much of FireMon’s growth has come through its expansion. In 2011, it acquired Saperix Technologies, a spinoff of MIT’s Lincoln Labs. The deal gave FireMon two important assets – innovative risk analysis tools that help organization understand and remediate network vulnerabilities, as well as access to the federal market. The latter has benefited FireMon as it now works with more than 50 federal agencies through the Department of Homeland Security’s Continuous Diagnostics and Mitigation program.

Details of the Insight investment come the day after FireMon announced its newest product, Policy Optimizer, a module that is used in concert with FireMon Security Manager and enables organizations to strengthen their overall security posture by quickly and effectively adapting network security device policies.

Insight, a New York-based venture capital firm, is no stranger to the security and greater technology markets. Its current portfolio includes BeyondTrust, GFI, Kaseya, Acronis, Veeam and Data Core Software.

“FireMon is dedicated to delivering innovative security intelligence solutions to customers worldwide and the investment from Insight Venture Partners will strengthen our ability to execute on that vision,” said Brazil.

FireMon was developed by Fish and the FishNet management team, which means there are no legacy investors to buy out and that much of the Insight investment will be used to continue to fuel the company’s expansion and product development.

“We are thrilled to be partnering with such a deep and experienced team at FireMon, and look forward to working with them to continue building a market leading business in security software,” Mike Triplett, director of Insight Venture Partners and new member of FireMon’s board of directors.

Fish has a knack for attractive strategic investments and parlaying them into company growth and equity events. With FishNet, he developed a strategy of taking in investments, growing the security integrator and then buying out the investors to maintain strategic control. In January 2013, FishNet sold a majority stake to Investcorp, buying out legacy investor Lake Capital Management, with the intent of growing international business.

With Investcorp’s acquisition of FishNet, Fish stepped down as CEO, which gave him more time to focus on developing FireMon.

This article originally appeared on Channelnomics.