Cylance, Internet-Security Developer, Gets First $15M Venture Capital

Cylance, a 7-month-old Internet security startup founded by a former executive VP of McAfee, said it had raised an initial $15 million in venture capital from Khosla Ventures and Fairhaven Capital, becoming the latest startup to pull in new cash.

The Irvine, Calif., company now has a payroll around 50, said CEO Stuart McClure, a computer scientist who previously had been at McAfee, now the security division of Intel Corp. (NASDAQ:INTC), the No. 1 chipmaker. Previously, he founded Foundstone, a security firm acquired by McAfee in 2004.

Intel acquired McAfee in 2010 for $7.68 billion.

“We are looking at prevention as a fundamental underpinning of the company,” said McClure, 43. Rather than developing security software that detects and prevents intruders, Cylance plans to devise software that moves to what he dubbed “the prevention model.”

The company has developed some early products under names including EnterpriseProtect and EnterpriseForensics, whose early versions are being tested by customers he declined to name.

McClure suggested a utility such as Consolidated Edison (NYSE:ED), the principal New York city electric company, might deploy the tools to “look for sabotage and detect infiltration,” as well as preventing them from happening.

President Barack Obama on Tuesday issued a new executive order specifically designed to improve critical infrastructure, which McClure said he welcomed. The order calls for a better government response to be developed to deal with all manner of cyber attacks.

Cylance’s investors are familiar tech financiers. Khosla Ventures, of Menlo Park, Callif., is the vehicle of Vinod Khosla, a co-founder of Sun Microsystems, now a unit of Oracle Corp. (NASDAQ:ORCL), the No. 1 database company. Other partners there include Pierre Lamond, a founder of National Semiconductor, now a part of Texas Instruments Inc. (NASDAQ:TXN), the No. 2 chipmaker.

Fairhaven Capital, of Cambridge, Mass., includes partner Mark Hatfield, who’d worked at Foundstone with McClure after working as a managing director for Motorola Ventures. One of its investments, Equal Logic, was acquired by Dell Inc. (NASDAQ:DELL), the No. 3 PC maker, and another, Softricity, by Microsoft Corp. (NASDAQ:MSFT), the No. 1 software company.

Typical for the sector, Cylance also elected some experienced outsiders to its board of directors including retired Adm. William J. Fallon, who was commander of the U.S. Central Command and commander of the U.S. Pacific Command for the Navy.

Others include Patrick Heim, now chief trust officer for Salesforce.com (NYSE:CRM) and Alex Doll, the former CEO of PGP Corp. before it was acquired by Symantec Corp. in 2010.

On Tuesday, Nok Nok Labs, of Palo Alto, Calif., announced it had also raised $15 million in venture capital from other firms. Its CEO, Phillip Dunkelberger, was also a CEO of PGP. Nok Nok is seeking to devise a united authentication infrastructure using an online secure transaction protocol to deal with problems dealing with passwords.

Cylance’s McClure said he saw no conflict with Nok Nok Labs.