Cybersecurity is one of the fastest growing sub-domains within the SaaS (software-as-a-service) space with companies like CrowdStrike (NASDAQ:CRWD) and Palo Alto Networks (NASDAQ:PANW) seeing their valuations go through the roof. As per Mordor Intelligence data, the global cybersecurity market was around $156.24 billion in 2020 and is expected to grow at a CAGR as high as 14.5% fom 2022 to 2027. The telework trend and the growing number of work-from-home employees is one of the biggest factors responsible for the growth of this market. During the course of telework, the use of personally owned devices and equipment that are not properly configured or could be infected with malware raises the risk of security breaches for businesses. During a cyberattack, the problem for any enterprise is not a lack of information, but rather the ability to use the available information to assemble disparate pieces of security information into insights for situational awareness and determine the optimal courses of action. Today, we will analyze a company whose virtual private cloud operating environments cater to this exact problem and deliver cybersecurity and data visualization solutions to customers – Visium Technologies, Inc. (OTCPK: VISM)
Visium Technologies, Inc., a cybersecurity and digital risk mitigation company, offers cybersecurity technology solutions, devices, and services to help businesses and governments protect their data. Network security, threat visualization, Internet of Things, mobile security, cloud, pinpoint threat identification, and big-data analytics and understanding at initial sight are among the company’s primary focus areas. Under the recent global telework conditions, Visium’s technology, TruContext , provides, facilitates, and boosts confidence in remote work infrastructures while enforcing and heightening cybersecurity protections. It is worth highlighting that company can quickly deploy TruContext and benefit from its capabilities remotely because it is entirely cloud-based and does not require on-premise implementation. Given the ongoing threat of cyber-attacks, TruContext’s cloud-based solutions can assist businesses in enhancing their security capabilities. It is a Fairfax, Virginia-based company that was founded in 1987.
Visium can be considered as a data analytics focused company with a wide application of its offerings where cybersecurity is one of the biggest and most important applications. The company compliments existing security information and event management (SIEM) solutions, tools, and services to enterprises, such as technology partner Splunk,. Its TruContext technology helps reduce risk and apply analysis efficiencies that simplify cybersecurity. It does this by rendering data in an immediately understandable way with context, providing better and immediately actionable security outcomes, combining unique visualization, advanced cyber monitoring intelligence, data modelling, analytics, and automation. They primarily generate revenue through three methods: a virtual appliance model aimed primarily at the federal government, which charges a seat licence; a SaaS model, which charges a recurring monthly licence fee for TruContext; and professional services, which support and deliver cybersecurity solutions and services to its customers. As part of its go-to-market strategy, the company has formed integration partnerships with larger, more established technology firms. In addition, Visium has formed relationships with value-added resellers who sell to the federal government and commercial markets. Although digital risk management, cybersecurity solutions, and technology services for physical network security, the cloud, and mobility solutions are the company’s primary focus areas, they also deal with mission-critical issues where context is imperative to understand the landscape. To provide its products and services to its customers, Visium relies heavily on its cloud based technology and infrastructure. They also rely on technology distribution firms.
The MITRE Collaboration
Visium has entered into a technology license agreement with the MITRE Corporation for the commercialization of its licensed patented technology, also known as CyGraph. MITRE is a non-profit organization that advises the federal government on engineering and technical matters. CyGraph is a tool for cyber warfare analytics, visualization and knowledge management and it known to provide advanced analytics for cybersecurity situational awareness that is scalable, flexible and comprehensive. Visium is expected to benefit from bringing MITRE’s intellectual property to market and has carried out the deal through its wholly-owned subsidiary, Visium Analytics, LLC. MITRE’s decision to grant Visium exclusive rights to develop and commercialize Cygraph is a strong endorsement of the company’s ability to commercialize the technology. Security is undergoing a fundamental shift, and CyGraph provides machine learning acceleration, advanced cyber hunting, forensics, incident response, and analytics that significantly improve the enterprise’s security posture while increasing efficiencies and cost savings. With Visium’s TrueContext technology, powered by CyGraph, cybersecurity is simplified by visualizing the network security posture before and during an attack in real-time, providing the security analyst with an intuitive situational picture of the enterprise. Furthermore, the phases could range from catching compromises in real-time at the pre-attack point to high-speed root cause analysis at the breach point, as well as predicting vulnerable paths that lead to preventing breaches before they occur. Visium Analytics, when combined with the MITRE ATT&CK framework (a curated knowledge base that tracks cyber-threat actors’ tactics and techniques throughout the attack lifecycle), is uniquely positioned to deliver immediate, intuitive and human-understandable focus of an attack radius, allowing time-constrained resources, such as cyber professionals, to zero in on the highest impact targets and priorities in real-time.
The TruContext Solution
TruContext, the company’s core offering, provides real-time automation and intuitive data understanding by allows clients to see the form of their data at first glance. By visualizing your network security posture throughout an attack, TruContext, powered by Mitre’s CyGraph, simplifies cybersecurity. The tool accomplishes its tasks by compiling disparate data and events into a comprehensive picture to aid decision-making and situational awareness and allowing for the prioritization of remediation to protect your most valuable assets by bringing together a contextualized composite view of cyber datasets. An attack-graph model is also included in TruContext, which maps potential attack paths through a network. The tool also provides all important context for responding to attacks and protecting mission-critical assets in the event of an attack. The attack graph is a dynamically evolving map of potential attack paths through a network. This includes pulling in aggregated data of network topology, firewall rules, host configurations, vulnerabilities, and any other network attributes that may contribute to attack success. TrueContext connects the dots in a human-readable and understandable way. The majority of today’s cyber tools lack the feature of context, which is an inherent function of TruContext; a classic example of this is Splunk (NASDAQ:SPLK). Even on Splunk, a lot of data is being collected and analyzed, but connecting events to problems using traditional data mining and analysis is a herculean task without understanding context. Through TruContext, Visium’s platform could have quickly connected the dots and provided understandable alerts for recent cyber compromises affecting the U.S. government, well-known industry vendors, and their customers. Furthermore, the forensics capability of TruContext
CyGraph can be used to identify additional potential vulnerabilities and root causes, adding significant value to ongoing investigations. TruConext also leverages graph technology, which, per Gartner, by 2025 will be used in 80% of data and analytics innovations, up from 10% in 2021, facilitating rapid decision making across the enterprise.
Valuation & Final Thoughts
We can see Visium’s share price is extremely low as a result of the constant share issuances to fund the product development costs. However, this is expected to change with the expected commercialization and SaaS revenues starting off in 2022. The management is now rapidly accelerating their corporate growth strategy due to this latest funding round. This includes hiring additional sales, marketing, and software development resources to take advantage of their TruContext platform’s timing and competitive advantages. The company should be able to capitalize on the fact that TruContext reduces the risk posture and frees up human capital that would otherwise be spent manipulating and preparing data for analysis for days, weeks, or even months. Cybersecurity as a domain is having extremely high revenue multiples (ordinarily above 7x EV/ Revenue). The same can be expected for Visium as soon as the company starts showing revenues. We expect a rapidly growing top-line and profitability for Visium in 2022 and beyond resulting in an improved valuation in the coming months.