Software Veteran John Mutch Moves IT Security Specialist BeyondTrust to San Diego, on Path to Build “Freemium” Business Model

When Agoura Hills, CA-based Symark acquired Portsmouth, NH-based BeyondTrust for a little over $20 million a year ago, the deal was viewed as a complementary combination of similar IT security technologies for fundamentally different markets.

BeyondTrust specialized in providing IT security for Windows-based networks by managing the access privileges granted to both system administrators and ordinary users. Symark, founded in 1985, addressed the IT security requirements of Unix/Linux-based networks.

But the combined company, which took the BeyondTrust name, is aiming its IT security technology more specifically at the regulatory requirements that top public companies have to maintain and protect their internal financial controls. This became apparent when I sat down with CEO John Mutch, who recently moved the company’s headquarters from Agoura Hills, CA, near Los Angeles, to Carlsbad, CA, about 44 miles north of San Diego. Mutch, a San Diego enterprise software veteran, joined Symark at the end of 2008 as CEO and investor.

Mutch told me he now owns 10 percent of the company, after he partnered with Insight Capital, a private equity firm in New York that purchased Symark in December of 2006. “They saw the potential with the core product that they acquired at Symark,” Mutch said, “but then they really hired me to come in and execute a transition into a ‘freemium’ model software company.”

Freemium is a Web-based software business model that offers customers a basic software program or service for free, and coaxes them to pay to upgrade to a premium version with more features. It is a low-cost model that enables a software company to avoid establishing its own sales force or creating a network of sales partners. “So our whole thing is driving traffic to our website, getting people to download the free version of the product, and then converting them to buy the pay-for version,” Mutch said.

“We’re in a whole new innovation cycle in the [software] industry,” Mutch said, due in part to widely available access to online information and the “instant on” capability of mobile devices like the Apple iPad. “The way people buy things now, the way they consider purchases, and the way they research purchases has changed dramatically.”

How Mutch and BeyondTrust plan to ride this wave was less clear to me, however, especially since Mutch is targeting what he calls the “global 2000” market of the top public companies around the world, rather than a mass market of small-business and home consumers. In addition to offering such corporations security software for delegating user privileges on their networks (technology categorized as “identity and access management”), Mutch says BeyondTrust is ideally suited to help public companies address matters of corporate governance, risk, and compliance.

I told Mutch it’s hard to see a stodgy public company downloading a … Next Page »

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Bruce V. Bigelow was the editor of Xconomy San Diego from 2008 to 2018. Read more about his life and work here. Follow @bvbigelow

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4 responses to “Software Veteran John Mutch Moves IT Security Specialist BeyondTrust to San Diego, on Path to Build “Freemium” Business Model”

  1. Jay Sheehan says:

    Freemium. What a deal. Customers try the product. Have a chance to see it’s minimal potential then realize they’ll need to upgrade to truly meet their needs. No sales force. I get it, no commissions on sales. John has a way of making this make good sense. I can’t help but think of the ‘drug dealer’ analogy. “First one’s free.” I’m glad I read this just to keep up with matters of business. Now I’ll be slightly more careful of what I download as I get swallowed up by the “try this” concept. Honestly, I’m impressed to hear that a CEO like John Mutch is honest and up front about all of this. He’s quite a “straight shooter”. I like that.