Cyber Security Firm LogRhythm Setting Tempo for March to an IPO

6/4/13Follow @MichaelXBD

Logging in to a network, whether for work, to check your bank balance, or to play video games, has become one of life’s routine hassles. But if you think logging in is a hassle, try running a network that must track thousands or millions of people trying to get access—and instantly predicting who has bad intentions.

Managing those logs, identifying threats, and making sure the network meets compliance standards is a pretty big pain point in the cyber security world. It’s also where LogRhythm hopes to make its name and fortune.

LogRhythm quietly has become one of Colorado’s most promising startups, although over the Boulder-based company has outgrown the label over past year or two. The company won’t disclose its revenue, but co-founder and CTO Chris Petersen says revenue is growing 40 to 50 percent year-to-year. It now employs about 250 people and sells worldwide.

LogRhythm’s growth trajectory has reached the point where an IPO looks like the next big step, and that’s what the company has in mind, Petersen said. LogRhythm’s leadership foresees an IPO in about 18 to 24 months, and they have been getting ready, for example, by adding new board members with experience running cyber security companies or government cyber security programs.

“As a company, we have to evaluate whether or not we’ll go public late next year or early 2015,” Petersen said. LogRhythm has “revenue and a growth rate that would support a public company, and this is still a rapidly growing and evolving market that would support a lot of innovation.”

LogRhythm is an emerging player in security information and event and log management software, which is an increasingly important part of the larger cyber security market. The goal of companies in that segment is to build software that can help … Next Page »

Michael Davidson is the editor of Xconomy Boulder/Denver. He covers startups, venture capital, clean tech, energy, aerospace, telecoms, and whatever else happens above 5,280 feet. Contact him at mdavidson@xconomy.com. Follow @MichaelXBD

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