Established in 2003, SecureWrap provides a complete service for developers that want to protect their software through product activation but would prefer not to (or cannot afford to) build and manage the necessary infrastructure.
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The other part of the service is a business intelligence facility that collects information about attempts to reinstall the software (legitimate or fraudulent). Most clients suffer inappropriate sharing not as a result of commercial piracy, but a lack of understanding by "common citizens who don't understand what software licensing means".
SecureWrap also collects information about the user's software and hardware environment. This is important for developers, as it provides valuable insights into the minimum level of hardware that they need to support.
"As far as we understand, no one else is doing that as a service," Midler says.
The company is targeting the hundreds of thousands of smaller developers with "very cheap" pricing -- "about the cost of a cup of coffee per copy," according to Midler.
The idea started when Midler realised he could offer product activation as a service after he met a developer who was concerned about copying. That developer's program was used in a 10-month trial, resulting in a robust, strong, simple, and well working product, Midler says. After some further research, a decision was made in January 2003 to patent and commercialise it.
"There are definite challenges in getting a company up and running," Midler says. The five people who invested in and worked on the project support themselves through other business ventures -- their spare capacity was used to develop SecureWrap.
So far SecureWrap has relied on organic growth, but limited cash flow restricts the time the partners can afford to devote to the business, which in turn restricts growth. Their expertise is in the core technology, not deal making or sales and marketing. This seems to be a common problem for startups; it's rare for a business to start with a balanced spread of expertise.
SecureWrap has been told by some that venture capital is the only way to go, others have told the company it is the worst thing it could do. The company received a COMET grant during its first year, which went on legal fees, market research, and a strategic and marketing plan.
The company is investigating other government grants but that would probably involve matching the amount awarded, so some sort of capital injection would be required to boot. "At the end of the day, it still requires us to have cash flow -- which is OK," Midler says.
SecureWrap is also exploring the sweat equity route, with another organisation showing interest in providing certain things in return for a share in the company. The problem, Midler says, is establishing exactly what it will do for SecureWrap.
Consultants have also told the company to prove itself locally before moving offshore, but there aren't that many developers in Australia. "That's one of the contributing reasons for why we're still so small," Midler says.
But internationally there is definitely an issue with software protection, Midler adds, pointing to figures that show worldwide losses of around AU$34 billion a year. "The market for us is still very strong, [and] it's very big," he says.
An endorsement for the company came from winning the 2005 AIIA iAward in the security category -- where SecureWrap's technology, marketing, and business plans were all put up to scrutiny. Now the company is hoping for assistance from Multimedia Victoria to attend a related international award event.
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