Pondurance strategic investment deal sets stage for Indiana to be a global player in cybersecurity sector
Ron Pelletier was one of the 30 million people who lost their jobs at the start of the Great Recession. As a cybersecurity specialist, he knew he could keep himself busy through independent consulting until a “real job” came along. From the basement of his home in 2008, he founded Pondurance.
Twelve years later, with help from business partners Landon Lewis and Dustin Hutchison, and CFO Cathy Iacobucci, Pondurance became a leader in Managed Detection and Response (MDR) cybersecurity services. The bootstrapped company had declined investor cash and took out only one small loan, which it repaid, until today’s announcement that it has accepted a strategic, private investment from Newlight Partners LP (NLP).
If expectations bear out, this effort could become one of the legendary founding stories similar to Software Artistry, Aprimo or ExactTarget, whose acquisitions created ripple effects and additional startups that helped Indianapolis establish itself as a Martech town. Pondurance could do the same for the cybersecurity sector.
Pelletier, now Chief Customer Officer for Pondurance, is excited about being able to give up some operations and financial management duties and narrow his purview to focus more on customers again.
“I never thought it would become the success it is today,” he confesses. “Frankly, when I first started, I kept telling myself that this was a temporary gig until I could find a real job, but more work kept getting in the way!”
Terms of the acquisition were not disclosed, other than to be described as “significant.” Newlight Partners, which has invested approximately $6 billion in over 100 investments since 2005, has approximately $4 billion in capital commitments and assets under management and generally targets investments up to $200 million.
The strategic investment will enable Pondurance to grow in the rapidly expanding MDR market, bolster its leadership team and drive research and development and innovation. The company headquarters will remain in Indianapolis and leadership expects to double the current workforce of about 50 people within the next several months.
“We had been carefully searching for the right investment deal that would allow our culture and technology to be built upon as a nucleus for fast growth,” Ron said. “The fact that NLP discerned us from a multitude of other cybersecurity companies confirms we have something worthy and unique; something our current clients have already taken note of. Still, we are humbled by this endeavor, and we’re excited to replicate our success on a national scale.”
Doug Howard, a veteran cybersecurity executive, will serve as CEO of Pondurance and Niloofar “Niloo” Razi Howe will serve as Chair of Pondurance’s Board of Directors. Both are from the Washington, D.C. region. They will remain there and open a regional Pondurance office.
Doug brings decades of cybersecurity executive leadership across products and services, and most recently joined from RSA Security where he led Global Services, IT Innovation and Business Transformation. Niloo adds deep industry and Board experience from software and security companies including RSA, Endgame and Recorded Future.
In addition to Ron, Pondurance’s existing leadership team, including Landon Lewis, Dustin Hutchison and Cathy Iacobucci, will remain with the business.
Doug said Pondurance’s intelligent threat detection, response platform and team of talented experts offer an unbeatable combination and competitive advantage for customers.
“Never before have MDR services been so important to such a vast set of customers,” he said. “We are eager to leverage Newlight’s resources and expertise to accelerate our ambitious growth plans and deliver higher levels of customer value.”
Shortly after starting Pondurance, Ron signed clients like the NCAA, Indiana University Health and CNO Financial Group. In 2011, Landon joined Pondurance and became instrumental in developing the technology platform that has brought success to the company’s MDR solution, and ultimately became the company CEO.
Pelletier said of Lewis, “Landon’s technical prowess is like no one else I’ve seen. Through his vision of Pondurance moving into managed services, we effectively tripled our business and, more importantly, were in a position to better serve our customers.”
As the new CTO, Landon said the move “is a really great deal for Indiana as the global cybersecurity sector is in consolidation mode. With the combination of financial backing and industry-proven leadership, Pondurance will be well positioned for additional growth through both hiring and acquisition.”
Landon added that “Newlight doesn’t make small investments, and it doesn’t think small, either. We’re very excited to work with Doug and Niloo as we embark on our next phase of growth.”
Newlight Partner Adam Stulberger said his firm is excited, as well, to work with the leadership team to “build an enduring business, expand its capabilities and geographic footprint, and execute on the numerous opportunities we’ve identified for organic growth and strategic M&A. Pondurance is a deeply trusted cybersecurity services firm that is extremely well poised for growth in a rapidly evolving market as customers address ransomware, compliance and digital transformation.”
Dustin, Pondurance’s CISO and VP of Services Delivery, predicted the company will make a lot of moves in the future.
“We’ve not even come close to seeing a standardized cybersecurity industry yet,” he said. Board level executives are taking note of the threat landscape, but there is still a great deal of risk emergence that makes it hard for companies to keep up to date.”
Pondurance is a TechPoint Mira Awards multiple nominee: In 2017, the company was a finalist for Tech Service of the Year, and in 2019 was a finalist for Scale-Up Company of the Year.