Fishtech Group could easily have reinvested when Haystax Technology Inc. was looking to raise more money. But instead, the Kansas City-based technology accelerator and cyber security startup saw a bigger opportunity: acquisition.
“It just made sense to bring them in under the Fishtech fold,” Fishtech CEO Gary Fish told the Kansas City Business Journal.
Fishtech initially invested $4 million in the data analytics company, which is based in the Washington, D.C., area, in 2016 — the same year Fishtech started business — to help Haystax’s technology go to market. But another key part of that investment was the opportunity to learn how Haystax built its software and ran its business, so Fishtech could incorporate some of the same techniques in its business, Fish said. The acquisition, which is slated to close in the next 30 days, brings more opportunity for both companies, he added.
“Haystax has a tremendous pipeline, tremendous people and a lot of momentum right now,” Fish said.
Fish declined to share financial details of the acquisition, but said Fishtech will retain Haystax’s McLean, Va., headquarters and its 68-member staff, bringing the headcount at Fishtech to about 150 employees. Moving forward, Haystax will be a wholly owned subsidiary.
Haystax analyzes a variety of data sources and uses mathematical models to predict cyber security threats. It’s a “tremendous intellectual property” that complements Fishtech’s data-driven security initiative, Fish said. Through the years, Haystax also has gleaned insight from user behavioral analysis, and Fishtech will be incorporating that information into its software-as-a-service cyber defense and response (CYDERES) division.
Haystax also gives Fishtech access to federal, state and local governments, where a number of Haystax’s contracts reside. It brings opportunity for cross-selling among both companies’ clients.
Once Haystax is assimilated into Fishtech, the acquisition will lead to new hires, including hiring Haystax employees that will be based in Kansas City.
This year, Fish plans to add 25 to 30 Fishtech employees to its Kansas City headquarters in roles such as security analysts, data scientists, threat hunters, sales and back office staff. Part of that growth is to sustain Fishtech’s 20,000-square-foot CYDERES facility, which is slated to be operational in late December or during the first quarter. The center will need to be staffed 24/7.
Also driving the growth is Fishtech’s technology offerings that are resonating in the marketplace, evidenced by its robust pipeline. The tech company ended 2017 with 790 percent revenue growth, and the first quarter is up 380 percent over the same quarter last year.
“High-growth companies are exciting, and it’s what I wanted to get back to,” he said. “The message we created just a few years ago is really resonating with our customers, so it’s nice to see what you conceptualize and build is something that customers want. And because of that, the company’s growing rapidly and thriving right now.”
Kansas City Business Journal