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Mohawk valley business journal I May 25, 2015

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AIS acquires D.C.–area cyber firm to further its growth ROME — Assured Information Security, Inc. (AIS), a growing Mohawk Valley technology company, recently closed on the acquisition of the assets of Information Security Solutions, Inc. (ISS), a tech firm based in the Washington, D.C. area. “This deal (which closed on April 16) doubles our presence in the nation’s capital region, enhances our technology base, and allows the combined firms to offer a broader array of technology solutions. This is our first acquisition and signals our focus on growing AIS,� Steven J. Flint, AIS’s chief operating officer, says. Flint notes his company was approached by Focus Investment Banking, LLC, a broker representing ISS. The negotiations lasted about six months. AIS did not release any financial details of the acquisition, except noting that it was an all-cash deal financed by Oneida Savings Bank. ISS is a provider of consulting services to the public sector. The company, which engages only in classified work, specializes in cybersecurity, information technology, and cyber-intelligence. Its customers include the intelligence community and other departments and agencies of the federal government such as the U.S. Department of Defense (DoD). “ISS complements our existing customer base and brings both new customers and resource strength in the form of reverse engineering and linguistics,� notes Flint. ISS was founded by Nolan Clifford, who began his career in the U.S. Navy at the National Security Agency. Later, in private industry, he was a principal (non-CPA partner) at Deloitte Touche LLP, directed the federal-information-assurance program at PricewaterhouseCoopers, LLP, and worked at General Dynamics in the national-assurance practice. Clifford will continue to direct the D.C.–area office, which is now called ISS, a division of AIS. ISS has 12 employees, all of whom joined AIS. AIS was incorporated in Rome in 2001 by Charles Green and three other partners. Green is currently the company’s CEO. AIS secures computer-network operating envi-

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Improving business decisions, operations, and performance

ronments, conducts advanced debugging, creates host protection, ensures access to multiple security domains, automates encryption and decryption, analyzes network packet capture, and conducts forensic services. Its headquarters is located in a 46,000-square-foot building at the Griffiss Business & Technology Park in Rome. AIS also has offices in Ohio, Maryland, Oregon, Colorado, Texas, Nebraska, Virginia, Georgia, and Massachusetts.

norman poltenson/business journal news network

BY NORMAN POLTENSON npoltenson@tmvbj.com

Steve Flint, COO of Assured Information Security (AIS) in Rome, displays a recent award from Lockheed Martin recognizing AIS as one of 22 valued business suppliers. On April 16, AIS closed on the acquisition of ISS, a technology firm based in the Washington, D.C. area.

Growth

“We’re experiencing rapid growth,� says Flint. “Last summer, the employee count was 121, of whom 105 were located in Central New York. With the addition of ISS, total employment is now 138, and we expect to hire another seven in the next few weeks. By this fall, employment is projected to jump another 10 to 20, depending on our success in hiring. That should put us at 155-165 people. AIS is budgeting for moderate to rapid growth in 2015 with revenues between $35 million and $40 million, depending on our success both in winning contracts and in hiring more staff. Many of the contracts we’re bidding on extend over several years, which should give the company a more even cash flow.� AIS is a “C-corp� owned by 13 stockholders. Its headquarters building is owned by the Griffiss Local Development Corporation/Cardinal Griffiss Development Corporation. AIS currently relies on three customers for 95 percent of its revenue. “We built our reputation largely on our capacity to do classified work for the DoD, DOJ (Department of Justice), and Homeland Security,� affirms Flint. “This concentration served us well until Congress came up with sequestration as a way to restrain spending. Two years ago, Green authorized the creation of a commercial division to develop a revenue stream from the private sector, which is recognizing the importance of cybersecurity and investing in protection. “While the current revenue stream from the private sector is still small at only $750,000 to $1 million a year,� observes Flint, “the pace of growth in little

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more than two years is impressive. We assigned our operations manager, Dan Kalil, to oversee the new commercial division and to develop business partnerships. We think this is the right time to develop business in the private sector, because corporations now recognize the importance of protecting their cyber infrastructure ‌ AIS holds four patents with another halfdozen pending; our goal is to monetize them. Our focus includes certain industries such as financial institutions, health care, transportation, power companies, and retailers.� Prior to assuming his new responsibility, Kalil, who holds a master’s degree in cybersecurity, led AIS’s investigativesystems program for seven years.

Competition

How does AIS separate itself from its competitors? In an interview last August, Barry McKinney, Ph.D. and AIS senior

See AIS, page 9

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vice president, opined: “Our bread and butter is R&D. That’s what really distinguishes us from the competition. We have years of experience working on sophisticated projects for DoD and the [Rome] Air Force Lab. This experience allows us to understand a problem, unlike the button-clickers who just push buttons to see what works. We learned early on that one size does not fit all; each project has to be tailored to the customer’s needs. It’s our staff that really sets us apart with more than 100 engineers and scientists ‌ [of whom] 50 percent hold or are pursuing advanced degrees. Also, nearly all of them hold security clearances.â€? Flint adds, “AIS has [also] built very strong industry relationships. We may compete against major companies like Lockheed Martin, Northrop, and Raytheon, but we also team up with them

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Digital Edition of the 5/25/15 Mohawk Valley Business Journal