A new St. Louis-based initiative might produce the next big advancement in the war against hackers and data thieves. SixThirty Cyber is an offshoot of financial technology venture fund and business accelerator SixThirty, which is housed in the T-Rex co-working space downtown.
The new initiative plans to invest $10 million over the next five years in cybersecurity startups. Two classes, each with five companies, will be held every year. Those startups will receive up to $200,000 and participate in a 14-week mentoring, business development and hands-on training program.
Organizers say the accelerator will help meet a pressing need. They point to comments last month by U.S. Securities and Exchange Commission Chair Mary Jo White describing cybersecurity as the biggest threat to the financial system.
That supports what many in the business community have known for a while; traditional approaches to combat cyberattacks barely keep up with an increasingly innovative criminal element.
“The cost of intrusion has skyrocketed,” says Six Thirty Cyber Co-founder and Managing Partner Jay DeLong, who is also a general partner in the original FinTech initiative.
“The corporate community recognizes that. The government recognizes that. That creates a market opportunity for St. Louis and for the accelerator.”
The timing of the launch also comes after officials with SixThirty noticed a trend in their program focusing on financial technology startups.
“We now see about 300 companies from across the globe and an increasing number of companies that were coming through were in the cybersecurity space,” says Atul Kamra, who is the managing partner of SixThirty and a co-founder of the cybersecurity accelerator.
“We decided to surround ourselves with a group of partners that have the subject matter expertise and the network for us to actually leverage that deal flow and apply that same community-based approach.”
One of the business-related partners is Optiv, which provides services to battle cyberattacks.
Jason Clark is one of the executives and the company’s chief innovation officer. He says criminals trying to steal an organization’s vital digital information can be broken down into certain groups including:
Nation, State and Hacktivists groups
- not focused on financial gain
- values do not line up with organization they target
- focused on profits
- often target banks, companies
- gather information that could drive the markets
- employees who no longer agree with company mission or leadership
- focused on hurting the company by taking information or intellectual property and possibly profiting from it
Insider threats have become more common.
“It’s 50 percent what we are seeing of the threats out there,” says Clark, who is also a general partner of SixThirty Cyber and draws a comparison to the movie, “Office Space.”
“It’s exactly it. In fact, when you think Milton - when they moved him to the basement with a stapler, or didn’t give him a stapler - I mean, he’s probably the one that’s going to probably find a way to do the most damage.”
In the movie, the Milton character becomes so upset that the audience is led to believe he started a fire that burned down the company office.
While fire safety most likely won’t be the focus of SixThirty Cyber startups, they might be able to help companies prepare if some employees make a real-life attempt to carry out another scenario from the movie.
Some disgruntled workers developed a computer program to repeatedly direct very small amounts of money to a non-company bank account. It’s a clear example of a potential information technology crime committed by insider threats.
Although the impact of the accelerator could be felt at businesses and organizations worldwide, there is a focus to make sure the initiative has a positive effect on St. Louis.
“We have some civic objectives, which are really to recruit and bring high-paying jobs to St. Louis,” says John True, a general partner at SixThirty Cyber and Cultivation Capital.
“The second objective is for us to create business value.”
True says taking advantage of experiences at SixThirty, which include a strong connection to the big players in the city’s financial technology community like Edward Jones, Scottrade and Wells Fargo Advisors, could help attract top-flight cyber-related startups.
“These financial services companies really have to get as connected as they can with the latest ideas.”
The proximity to Scott Air Force Base and the National Geospatial-Intelligence Agency are also key factors that are expected to attract startups with the best ideas.
Applications are being accepted for the first class of SixThirty Cyber, which will start in September.