Parsing Trevor: how a boy from Blanch hockeyed the competition
Logentries is one of the most valuable companies ever to come out of an Irish university. Donal Lynch spoke to its Dublin-born co-founder
It's mid-October, the day of the Budget in Dublin - but Trevor Parsons, perhaps unique amongst Irish entrepreneurs, seems hardly aware it even happened.
That is because the announcement of the nation's financial roadmap for the year ahead coincided with Parsons' own big media splash -and there are photos of him beaming in most of the national newspapers.
He has good reason for smiling. Logentries, a company which Parsons and his business partner Dr Viliam Holub spun out of UCD in 2010, has been bought by US security analytics company Rapid7 for $68m (€63.6m). The price consisted of around $36m in cash and $32m in Rapid7 equity.
It's a notable success story for UCD - but most of all for Parsons and his team. The Dubliner, bleary-eyed after a long flight back from the company's Boston office, concedes that it's been "one of the biggest weeks of my life".
Logentries provides a cloud-based solution for collecting, searching, visualising and analysing machine data and logs. The architecture enables users to store and search data in real time.
"We've been described as CCTV for software systems. It's a cloud-based technology," Parsons explains. "Log entries are essentially data about what's happening in any of your systems.
"Log data is produced from every application or device, from large software to your computer or mobile phone. There can be tens of thousands of events per second, so in its raw form it's not very intuitive. Logentries collects all the data in one place and analyses it."
Exact figures on the size of the log-management market are hard to come by but Parsons puts them at "tens of billions". The market is thought to be nearly mature in the US, with key growth being seen in Europe and Asia.
The main driver at the low end of the market is thought to be compliance with regulatory mandates at lower price points. The biggest driver at the high end of the market is continuous security intelligence to protect against threats, intrusion detection and intrusion prevention systems, network behaviour analysis devices and firewall defences.
Parsons point out that the need for the kind of analysis his company provides will only increase as the internet of things becomes more common.
"A couple of years ago, only your laptop produced data. Now your phone is sending it, the lamppost on the street is sending it - and receiving it. Everything is producing log data - but the question then is what does this mean? It certainly raises security questions. Can someone hack into a lamppost and therefore hack into security information in your house?"
Rapid7, Logentries' new big brother, was named after New York's transit system (the company was founded in Manhattan) and brings more to the table than the obvious ton of money, says Parsons (admittedly he doesn't phrase it quite that way).
"If you look at Rapid7, their mission is to engineer simple innovative solutions for security challenges today. They're one of the leaders in the security challenge space. One of the biggest security challenges is to be able to collect, analyse and correlate data across your organisation. If you do that, you can understand threats and risks.
"One of the things we didn't provide was the security capability on top of this technology. That's what Rapid7 brings. One and one doesn't equal two here. The sum is greater than the parts."
Parsons describes Logentries as "a typical example of an overnight success that took about 10 to 15 years to bring to fruition". He's also quick to credit NovaUCD - the university's Centre for New Ventures and Entrepreneurs. Since its inception in 2003, companies supported by the centre have raised over €100m, with the nearest comparison in terms of sale price being 2008's sale of Barry Smyth's brainchild ChangingWorlds to US-based CRM software service company Amdocs for $60m (€55m). Logentries was the overall winner of the 2010 programme and won the NovaUCD 2010 Start-Up of the Year Award.
Parsons and Holub, who holds a doctorate from the University of Prague, were post-doctoral researchers in the university and worked with a team called the Performance Engineering Lab, a group that is led by two brothers, Professors John and Liam Murphy.
"It was a lab that aimed to work very closely with industry to solve real industry problems," Parsons recalls. "One of the problems that we looked at throughout that research was log management.
"We would have spent five, six, seven years researching and publishing in national journals and so that all played a huge part in enabling us to hit the ground running when we actually started the business.
"We were able to start building a technology without a huge capital investment - because by that point we really were the experts in the space."
He describes the Czech-born Holub as "really the brains behind the operation."
"Viliam was the architect of the technology and was very much the owner of the technology and how it was built and implemented. My role was very much building the business. I was charged with designing the product, shaping the product direction and making sure that the product was aligned with the market."
Parsons concedes that by the time Logentries came into being the marketplace was already crowded with big competitors tackling the security space - "the IBMs of this world" - but he and Holub had the advantage of a smaller, nimbler operation and a user-friendly approach, which itself was aided by advances in technology.
"We've always tried to be more innovative and simpler in terms of how we approach the problem. Over five years we've signed up over 50,000 users and they can start using the technology within minutes; there is no need for training. We've tried to bring time value in that people can quickly access the solutions.
"If you look at how things were done previously, it took a few months to train staff and you had this big piece of investment which you had to get big value out of because you'd spent so much money and time on it. We've taken a more nimble approach."
Initially Parsons and Holub put what the former calls "the little money we had" to try to get the venture off the ground and he says that advances in cloud technology were a huge help to begin with.
"When the business started we were post-doctoral researchers and we put everything on a credit card - that was the only way we could put money behind it. What's interesting nowadays is that that kind of thing is actually possible. Ten years ago, you would have needed a ton of money for 50 servers but now you can just spin up a few from Amazon for $50 a month or something like that. It was a lot more blood, sweat and tears and we've put our heart and soul into it."
They found angel funding easy to access - "that can enable you to take a wage for a year or two" Parsons says - but the real challenge was the step up to seed funding or series A funding, which would enable the company to grow to the next level. Logentries received some funding from Enterprise Ireland but it was the involvement in 2012 of Polaris, a venture capital company with offices in Dublin and which specialises in technology and healthcare companies, that really proved transformative.
"We followed that up the next year with a series A round. That is something that would have been very difficult to do in Ireland without going to the States. Having a partner like Polaris transformed our business, because they'd seen companies like us and could guide us to the next level."
A key element of this was establishing the right team.
"Our former CEO Andrew Burton (now on the board of Rapid7) had come on board and we built up a professional management team.
"Andrew has helped shape the company as much as myself and Viliam did. We met Noel Ruane, who was the lead investor in the company, and they were really the third and fourth founders.
"Human relationships are key and establishing these were some of the most important things we did. They knew what they were doing, we were first-time entrepreneurs."
Parsons' Dublin accent has been unbevelled by the transatlantic trips and although he is cagey enough that he won't say what his parents did for a living (that's "private life stuff", apparently) it might be safe to say his background is not what one might expect of the country's foremost entrepreneurs.
He grew up in Blanchardstown and went to Coolmine Community College. His business nous and academic bent weren't his only unlikely traits; he's also a keen field hockey player.
"Yeah, if you're from the northside of Dublin and go to Coolmine … well let's just say it's not the most common of sports amongst your peers.
"I do think there are great parallels between business and sport, however. I would have grown up with a group of lads from the time I was small to when I was 30 - and the amount I learned on that journey to do with hard work and perseverance, as well as how to be part of a team, and how great leaders lead was incredible. You see how to find where your skill set fits into a human hierarchy."
At DCU he did a degree in computer applications.
"I went on to do a PhD in UCD, where I went to work with John and Liam Murphy."
He likes to tell people he never had a real job. "I was a student for a long time and then I moved into academia and started a company. I kept the real world at bay."
That sounds like the modesty of the super confident. But does he have another trick in him? What the country needs is serial entrepreneurs. Given how well he's proven himself already, has the success with log entries whetted his appetite to do it all again?
The PR person from Rapid7, who has sat in on the interview quickly pipes up: "We're not letting him leave!" but before images of Tom Cruise in The Firm come to mind, Parsons pipes up in all seriousness.
"I'm committed to building up this company and a very strong offering with Logentries and Rapid7 - beyond that, in the future, who knows what will happen?"
'We sort of bet on the cloud - and we won'
The next big thing in my industry is going to be… "The cloud has been the biggest innovation in the last four or five years. We sort of bet on that - and we won. I think that will continue to grow at lightning pace
"Another thing that's going to be really good for us is the internet of thing. This changes the landscape. Nowadays everything is producing log data."
The most broke I've ever been was... "When I was starting the business, I was fairly low on cash and I'd exhausted every resource - whether it was parents, relatives or friends. I had to borrow. I had to borrow €50 from my missus at the time to get home from town. That was prior to the seed-funding round. It wasn't pretty - but it sticks out in my memory."
The best advice I was ever given was… "An old hockey coach told us, 'Anything that comes easy in life isn't worth a damn.' That kept us going through a lot of the long, dark, lonely nights."
My own favourite investments are… "Well, I had my head down and was focussed on building a business, rather than investing in other businesses."
The best trip I've taken recently was... "Coming back home from Boston after all the news broke."
Sunday Indo Business