Joe Kosco [00:00:00] Hi, everyone. Welcome to another episode of Cloud N Clear. I’m Joe Kosco, senior vice president of sales here at SADA. And I’ll be your host today, taking over for Tony Safoian this week. I’m really excited for today’s episode. Our very special guest today is Bill Smith, the chief sales officer at Virtru. Who over the 25 years of experience that he has, marketing and selling enterprise software technology, has a lot to talk about. We’re going to be talking about the amazing success Virtru has demonstrated over the past eight years as it has revolutionized the email security market, especially as it relates to cloud-based email exchange. Bill, welcome to Cloud N Clear.
Bill Smith [00:00:45] Thanks Joe, it’s great to be here.
Joe Kosco [00:00:48] Bill, before we start diving in, can you give our listeners an overview of what Virtru is all about as a company?
Bill Smith [00:00:55] Absolutely, Joe. Virtru helps organizations, federal agencies, large companies, small companies communicate securely in their high-value networks. And we do this by empowering them to unlock the power of their data while maintaining control of their data everywhere it’s stored and shared. We have more than 6,000 customers globally that leverage our data security and privacy protection technology.
Joe Kosco [00:01:24] Excellent. So let’s dive in before, let’s rewind the clock a little bit or maybe a lot, as a matter of fact. I’m curious about your extensive background in sales leading up to your decision to lead sales at Virtru, which you started about six months ago. Tell us about your early days at Amdahl Corporation, MicroStrategy, you have a strong background in sales of hardware storage and even mainframes. In addition to business intelligence. Tell us about –
Bill Smith [00:01:53] Do you have to remind me of that? Like how old that is and how far we’re going back, is that necessary?
Joe Kosco [00:01:59] Hey, I’m an old guy, too. I love this stuff.
Bill Smith [00:02:02] Yeah, no, I’m happy to talk about that. It was a thrilling time for me. Amdahl was the first competitor to IBM in the mainframe space many, many years ago, introducing a different type of technology and introducing storage technology to compete with IBM. It was ultimately acquired by Hitachi, you probably know. But I learned the value of what a great product and a differentiated product could do in a marketplace. Gene Amdahl, who started that company in 1970, it’s a pretty interesting story. He was part of IBM for 15 years or so, developing mainframe technology. The technology that was used at the time was a water cooled technology because the mainframes got so hot, they were so big and they were in these data centers. He came up with this concept of air cooled. IBM wasn’t too keen to it at the time, so he took a step away, created his own company. And, oh by the way, did it 200 percent less of a footprint, a lighter machine. And oh by the way, charged about 10 percent less. And so for me, that was a really interesting story just in terms of how to take on the 800-pound gorilla and how something can be differentiated with your product set and then figuring out how the value can be sold associated with that. I think for me, as my career progressed and I went on to sell for MicroStrategy, it was much, much different because at that point it was a startup company. The product differentiation was there, but it was also at a time where the Internet was blowing up, it was part of the dotcom boom, if you will, and that Internet bubble. But it was my first interaction with business users. Frankly, I’d spent all my time in the IT shop talking to data center managers, talking to those that were worried about moving throughput and performance was kind of everything. And that transition to the business intelligence space was fascinating for me because I learned the value of understanding the business requirements, learned about ROI, I learned about channel development to some extent. We competed against strong companies such as Cognos and Hyperion at the time. And so our approach became much more systems integrator related projects that the business users themselves could sink their teeth into. And we tried to be real clear in terms of our value proposition through the channel. And so all those were really solid learnings as a sales rep for me.
Joe Kosco [00:04:37] Yeah, that’s a really interesting transition when you think about mainframe and you think about the applications from mainframes, they’re very clunky. They’re not user friendly at all. I’m thinking about being at an airport and I feel like the ticketing agent is standing behind a system that was developed 40, 50 years ago. And I just want to make a time change on my flight and it seems to take like 15 minutes to go through. So and then, yeah that was the time when business intelligence started to blow up. And you quickly transition from talking about footprint of the mainframe and the cooling aspects that would really no end user would ever care about anything like that, to getting into visualization of data in unique ways that those end users prior to those technologies like Cognos and MicroStrategy. End users really never had any tools like that before. So it really opened up a new world, I would imagine. What was that like finally making that transition? It probably was a new –
Bill Smith [00:05:38] Yeah, it was interesting. It was challenging. I mean, business users in general had to trust what they saw from the I.T. organization, right? That was what they were programmed to do. And I think when they began to see on a much smaller scale the type of analytics and intelligence that they could glean from a small database or a small data set that they themselves could own on their laptop, and they could actually pull in particular sources and integrate that into that little database and then run their own analysis off of it whenever they wanted to. The timeliness of that, the new applications that they could apply, the way they could make their customers happy with – it just turned everything on its ear. And so, you know, that was to some extent the, you know, of that analytical time period, late 90s, early 2000s, where that big data stuff became a bigger deal. And yeah, you’re right. You know, in comparison to what the IT function owned, they then became much more of a supplier of information versus the one that did everything for the business users.
Joe Kosco [00:06:44] You probably saw some aha moments from those business users when they first got a glimpse of what power they would have in their hands around those laptops. Must have been interesting to see.
Bill Smith [00:06:56] It was. I mean, and at the time, I mean, that also was parallel with a lot of the telecom explosions that were occurring. And so in particular, a lot of the – I sold heavily in the mid-Atlantic area to the Bell Atlantic space, you know, now Verizon for those of you that don’t know that. And there were a lot of small companies that actually made that up and we would go through and have those conversations at the business level and literally in front of us, they’d realize, they’d doubt the results. And then once we could prove to them it was coming off of their data and encouraged them to just add a data flow in real time while we were doing a demo and they were able to do those kinds of things, they were ready to rock and roll and find some budget to do something. And so it was an interesting, interesting time. And I compare it to obviously what’s occurred, you know, with these things at the consumer level at this point, right? Where you’re now making a decision based on applications that you’re 110 percent empowered to. But there’s privacy challenges with that, which we’ll get around to that in our conversation, too.
Joe Kosco [00:08:04] Yeah, absolutely. So as you progress through those roles, you went into more senior sales management roles. What did you learn during those years that helped you refine your craft as a senior sales professional?
Bill Smith [00:08:19] Yeah. I think for me, I went on to work for a company called Ascential Software. There was some terrific sales leadership and just management leadership there. We were sold to IBM. And so for me, I kind of got the opportunity to get a blend of startup mentality in the big data space around data integration at Ascential and then some really strong, what I would call middle and upper managers at IBM. And I think one of the things that I began to learn was just the value of transparency. And I think the value of developing a very specific go-to-market strategy for a sales organization, things that I really hadn’t thought much of because I was kind of following a plan. But in particular, when I got to Syncsort I was put in charge of the North American team. And as we went through and identified our goals, I think that a lot of the learnings that I gleaned from IBM assisted me in developing a go-to-market plan that was multifaceted. That was for the first time for me, data driven in terms of our existing customers and what kind of expansion activity we should be looking at. It was channel centric to some extent, depending on the region. And so I began to learn those type of skills. And I think in particular transitioning over to Sonatype kind of in the 2013 time period, we learned how to enable a sales team at a level that I hadn’t before. And so there’s a lot in there. But I think in general, for me it was a progression of kind of establishing and understanding the broader go-to-market strategies that need to be implemented and then working with cross-functional teams to come up with the right way to approach that as a sales organization.
Joe Kosco [00:10:20] Excellent. And that brings us to current day, your decision about six months ago to join Virtru. Tell us what caught your eye about the company that was much smaller than some of the organizations you had been at previously?
Bill Smith [00:10:33] Yeah, I mean, first off, I saw similarities to what I had walked through with Sonatype, which was a security based organization, kind of cyber focus. But I think the thing that really jumped out to me was that this organization allows large companies, small companies, it does not matter, the ability to unlock the power of data. And by allowing them to always have that data under their control was really interesting to me. So there’s a ton of use cases in the market today. And as we are really seeing is as recently as this past weekend with the Colonial energy challenge that’s occurring on the East Coast, there is certain amounts of data that an organization needs to maintain ownership of as it leads their organization or as they transport it, rather inside or outside of it. I think Virtru’s capability to enable companies to control that, manage that, and have visibility into that was fascinating to me. I think in particular, based on just the amount of privacy issues that have occurred, I think in particularly the last two or three years, right? We’re somewhat in a societal crisis related to data protection. It’s become more of a GDP-level concern. And I think the concept of just restoring public trust is just personally interesting to me. So it was an interesting market for me to step into. It’s a DC based company, which I like. And once again, back to the data piece, it’s a very data centric approach, which I have a history in and I’m comfortable in as well.
Joe Kosco [00:12:21] Yeah, it’s a really interesting challenge, the fact that sharing data and insights is part of its power but at the same time, large organizations need to control that data, where it resides, who owns it, who has access to it. And it’s really critical that you get that security layer just right so that you don’t have an issue like what they experienced at Colonial over the weekend.
Bill Smith [00:12:47] Right. Yeah and I think our approach is to be able to protect the data, but also be able to confidently share that data. But the only way you do that is obviously through control. And so you’ve got to do it without impacting the users. And so, you know, one of the things that we do really well with all of our applications that we allow encryption control and audit with is that capacity, you know, with emails and files in particular, we’re exceptional with that. And the ease of use associated with that is why we have such wide adoption. It’s why you see us within a small business, might be a doctor’s office or it could be a small hospital, as well as very large organizations that are part of the global 2000 and large federal agencies. And so it really does all come back to that protect, share, and control mentality that we put in place.
Joe Kosco [00:13:49] OK, so let’s get deeper into the Virtru story. Can you tell us how it all got started? How did Virtru come to be?
Bill Smith [00:13:55] Sure. Yeah, I mean, the company is about nine years old, started in 2012. Two brothers, Will and John Ackerly, and their mission was really around protecting sensitive data. And it began in the intelligence community where Will Ackerly was working, the IC simply lacked a secure framework for protecting and sharing intelligence across diverse networks and domains. And so he developed what is called the trusted data format, or TDF, as we’ll call it. And it was the first open standard that is really at the center of our entire portfolio of solutions. And so that to some extent, was the big idea that launched the company. And we have that element at the core of what I said previously that allows us to be able to share sensitive data and being able to revoke the rights of that data at any point because you’re the data owner. And that concept is established by this concept of the TDF, which is, you know, basically an attribute-based access control system that no one else offers at the level that we do. So it protects data as it travels, no matter how or where the information is shared. And so once again, that’s at the pillar of everything that we’ve done. And, you know, the company started very slow with, you know, with some smaller organizations to adopt it and understand it. And over the first four or five years, the company was, the offerings were received very, very well in the small business space, in the mid-market of enterprises, and began to blossom as well on the federal government side. And so if you look at the last few years in particular, we’ve begun to move up market. We’ve begun to find ourselves in some interesting international opportunities and federal opportunities. And so we feel like we have something that’s grown over time that is clearly a global solution that organizations can gain trust in sharing their data.
Joe Kosco [00:16:11] Yeah, it’s interesting, we need more security in our technologies than just about anything but security products never, just never really seem to be front burner issues until something happens. You know, like we saw on the East Coast with the pipeline hacking. How do we get over that? How do you get people to think more front and center about security just as important as the rest of their technology environment?
Bill Smith [00:16:38] Yeah, I think what’s good first off, the media helps, right? So I do think highlighting it at the level that we do when you see gas prices go up, there’s a personal involvement, you know, for what’s going on with Colonial. That’s a great example. I think the biggest thing is, is organizations identifying that it’s a competitive advantage to securely share sensitive data, in particular with their clients and with their partners. I think that is beginning to occur and we’re seeing that in some of our larger organizations. Clearly, the government and the compliance front is helpful, right? And so if you see through some of the newer compliance elements, like the Cybersecurity Maturity Model Certification, CMMC, that the Department of Defense has established. There’s an innovation element there that if you are going to be sharing data, you’re going to need to comply with that model. And so for folks that are exporting data, it’s a challenge right now. And so I think if you look at those two things, it becomes pretty apparent that an organization needs to be thoughtful, that security really should be thought of as part of your infrastructure. Especially if you look at the amount of data volumes or the growth and the increase in data volumes in complexity, it’s much, much harder to manage and maintain, it’s much more difficult to mine data. If you don’t have a strategy with regards to how you’re going to share sensitive data, your ability to expand globally, your ability to enhance your sales effectiveness, a lot of the things that are important to an organization start to fall down. So I think the bottom line answer is the bottom line. I think it’s competition. It’s being more competitive than the two or three larger organizations you might be competing with. And I think it’s a combination of that and just the compliance pieces that seem to be so prevalent today.
Joe Kosco [00:18:43] What in store for Virtru in the security market, what do you expect to see over the next five years? How will the landscape change? How will technology help that? What are your thoughts on what’s ahead?
Bill Smith [00:18:58] Yeah, you know, I mentioned the compliance piece. CMMC is relatively new. I see other compliance elements stepping in. I think because privacy itself is such an important element under the administration. In the US, for instance, you’re only going to see more sensitivities to it and I think more compliance that’s going to come into place. And so I mentioned the growth in the explosion and just data itself, that’s not going to stop. And so I think over the next four or five years, as it pertains to just being able to protect the data the way that you want, and to be able to share data with partners I mentioned, which is such a big one, to be able to share data for compliance reasons with the government itself, that the growth there is only going to, I think, ramp up a necessity for infrastructure plans that include, how do I manage my sensitive data? You know, and there’s many opportunities out there for other products to help support this in addition to ours. Honestly, we’re not everything to everyone. But at the end of the day, we feel like we’re really well-positioned as those adjustments and changes occur.
Joe Kosco [00:20:15] Tell us about Virtru’s special relationship with Google.
Bill Smith [00:20:19] Yeah, so I think the Google partnership is, give me a second. Let’s restart on that one. I want to get to the right talking points. Yeah, so the Google partnership was entered into, in December of, formally, December of 2020 last year and that was after three years of spending a lot of energy and time with them, in particular around the Google Workspace, the Gmail and privacy and compliance challenges that they had. So what we offer for Workspace and for G Suite is your ability to provide end-to-end encryption at a level that Google themselves cannot. And so we enable a persistent protection for email and attachments, allowing the organizations to maintain control past the Gmail to desktops, to drive, anywhere else that files are stored. We automatically enforce the Gmail encryption with data loss prevention. And so we partner with the DLP providers out there to support them on that. And the key piece here is maintaining the visibility of these protected emails or really anything that is created within our encryption system, being able to track it through the data lifecycle, if you will, and streamline and audit those workflows. And so that relationship has begun to blossom to the point where we were just put on the Google marketplace a few weeks ago, which is really exciting. And so we’ll look to continue that and expand upon that as we develop new technologies going forward.
Joe Kosco [00:22:06] Yeah, I know that Virtru’s extremely well known. We sell, SADA does, into lots of states and agencies, a little bit into the federal government. It’s very well known there for email encryption. But tell us about like data in general, databases in the cloud and data lakes, data warehouses, and how Virtru might play a role in securing that data in the future.
Bill Smith [00:22:35] Yeah, I would encourage you just to think about them as kind of sources and targets. And wherever there’s a source and a target, we have the capacity to encrypt that data, move it into a target, decrypt that that data, and allow whoever created the data to maintain the visibility onto where that’s going and to at any point during that process revoke that capability. And so that’s important because if you see someone get into have access to something you don’t want them to, you can pull it back, right? There are challenges getting into the cloud today, right? People, not everybody trusts Google with access to their data because in some areas, Google is even a competitor to them, right? And so how do you ensure that Google’s not going to have access to that data? There’s requirements tied to compliance with EAR and ITAR data, for instance, in the cloud. How do you comply with that? And those are all things that we can help with. There’s organizations that want exclusive control over their encryption keys to protect their emails and we give them that as well. And so there’s a number of use cases in particular as folks move to the cloud that we see as they migrate that they gain value from Virtru.
Joe Kosco [00:24:02] Excellent. So I’m curious, turning back to sales for just a minute, what are the key differences between selling traditional enterprise software like mainframes and databases and cloud technologies like Virtru?
Bill Smith [00:24:16] Yeah, I think there’s a little bit of everything is old is new again, right? The database was an innovative element that pulled in disparate systems and feeds into a central location. I think that’s similar with the cloud. But I think the concept of on-prem versus off-prem and control puts a huge emphasis on a few elements that are really critical. Obviously, reduced cost is one of them. The flexibility that you get with the cloud, the scalability. You know, there’s a lot of similarities, frankly, to mainframes and databases and where I came from with regards to that. But when you look at things like the lack of a need for a backup plan, which was so necessary with the database and the expense to take that into consideration, and data security itself actually can become much, much easier through the cloud and in the cloud. And the other thing I think just with regards to the cloud is you just have such a wide range of options in terms of how to host and where to host that those flexibilities, combined with the reduced cost is why everyone is going, you know, that direction. And so, you know, we feel like that Virtru is a nice consideration for once again, the sensitive elements that are going to be moved into the cloud. You know, people should be looking at a technology such as ours as they go to do that. And not every workload is that, as you know. But from our perspective, we think we’re a great solution to be able to have that conversation.
Joe Kosco [00:25:55] What does success look like for Virtru in the end?
Bill Smith [00:25:59] Yeah, I think we’ll continue to evolve in terms of that simple element, Joe, of the data itself. And wherever that data is stored, how can we ensure that anything sensitive can be protected? And I think for us, it could evolve outside of certain applications, as we do today. I mean, email is our biggest one between what we do with Google and with Microsoft. But it’s also clearly the applications that exist today, like Salesforce that has sensitive data that is automatically triggered throughout an organization that we can help control through our gateway. And so I think there will be continual other applications on the edge as we look IOT type of capabilities. There’s a lot of use cases that begin to open up that aren’t necessarily within the data center or within the cloud type of use cases. So these would be use cases such as the sensor data or sensor information that could be captured, rather it be in a battlefield for the army or it could be related to sensors off of a highway that organizations want to gather information on and understand, but at the same time can’t allow that to get into bad actors control. And so for us, we see a real growth curve associated with those other applications and other uses because we see the TDF once again being an open architecture, an open framework that can support that. So we’ve started to see some real interest in the last six months, in particular within the government space, as well as I think some very innovative, you know, satellite organizations that are looking for interesting use cases that they can leverage that data. So I think as you look at video and other things that could be tied into that, starts to open up a whole new potential for us outside of just traditional email applications or even custom applications that organizations today use us for. And so as we look to evolve that, as we look to develop that along the way, it comes back to just value. If we can continue to deliver value to our customers, provide value to our valued partners, then I think we’re going to you know, we’ll be a successful organization. I think it’s impossible to say, you know, five years from now, ten years from now, where we’re going to be. But we’re just going to look every single day, every week, every month to try to deliver value to our customers.
Joe Kosco [00:28:45] Bill Smith, chief sales offer – I’ll start again. Bill Smith, chief sales officer at Virtru, thank you so much for sharing your insights with us today. I know, speaking for SADA, that we truly appreciate your partnership and the collaboration that you have with us and with Google. And we look forward to a very bright future together with you.
Bill Smith [00:29:11] Thanks, Joe. It was a real pleasure speaking with you and I echo the partnership feeling with regards to SADA, with Google, really enjoying it and looking forward to continued success.
Joe Kosco [00:29:25] Thank you.
Bill Smith [00:29:25] Thanks.