"I had spent all of my family's money. 1 had spent all of my kids' college funds. I had spent my 401K; I had 27 VISA cards with cash advances on them, and we were out of money. The darkest dark came when my wife found out I had withdrawn the last $4,000 that she had in savings. That was not a good day." The week got better. A $25,000 check arrived from NASA. In January 1996, ISS raised its first venturecapital funds, led by $3.6 million from Greylock of Boston and Sigma of Menlo Park, Calif. "That was the spark that we needed to get going," Noonan says. ISS generated about $200,000 in total revenue in 1995. Noonan told the dozen employees the company would generate $5 million in revenues in 1996. It was a huge goal, he admits, but by the end of the year, the company had grown to 41 employees—including a number of engineers—and had done $4.6 million in revenue. ISS also opened a European headquarters in Brussels, Belgium. And ISS developed two new products: System Security Scanner, a system-based vulnerabilitydetection product, and RealSecure, the industry's first software-only intrusion-detection system. "RealSecure has redefined the security industry globally, and it has really helped to put us on the map," Noonan says. Mapping Growth
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he growing company was consuming capital, and in the fall of 1996, Noonan was again seeking venture capital. The second round was much easier. In January 1997, ISS raised $5.2 million from Kleiner, Perkins, Caufield and Byers, one of Silicon Valley's premier venture-capital firms—an investor with a reputation for backing such winners as Netscape (recently acquired by America Online for more than $4 billion), Sun and Compaq when they were small. The Byers in the firm's name is Brook Byers, EE '68. Noonan also negotiated a valuation of $50 million on ISS—a remarkable achievement for the 2-year-old company. And AT&T came aboard as one of the company's strategic customers and investors. Noonan announced to his employees and investors the company had to grow from $4.6 million to $14 million—more than tripling its size. The company finished the year on target, with 141 employees and approximately $14 million. In November 1997, Klaus and Noonan told the board of directors they wanted to take the company public. It was time,
Noonan recalls, to "go out and compete in the big leagues." The board agreed. The banking firm Goldman Sachs & Co. underwrote the $73 million stock offer by the parent company, ISS Group. Publicly traded on NASDAQ as ISSX, the offering was so hot that the original price of $10 a share was hiked to $22, then soared to $42.50 on the first day. It reached a high of $56 before settling in the range of $37 a share. "At one point, the company was valued at $1 billion, which is just amazing," Noonan says. The March 24 date for the initial public offering coincided with Noonan's wife's birthday. "She had a huge amount of faith," he says. "My wife was an absolute charm. Her strength has been tremendous." Noonan met his wife, Kim Pace Noonan, IMgt '83, a Delta Air Lines flight attendant, at Georgia Tech—she was his freshman chemistry-lab partner. They have three children: Tommy, 9; Caroline, 7; and Marshall, 4. During the first nine months after going public, the company more than