How it got its start: Founders, who saw FMC technology as a "new step" for carrier voice services, spun the company out of Bell Canada to address the emerging market.

Management: The team includes CEO Neil Baimel, who is former CEO of Syndesis, maker of service-fulfillment software for service providers, and Lloyd Williams, vice president of engineering. Williams, formerly a researcher at Bell Canada, has authored more than 25 patents.

Funding: US$27 million from Vengrowth Private Equity Partners, Newbury Ventures, BDC Venture Capital, B.E.S.T Fund and Bell Canada.

Who uses the product: Embarq, BT and Bell Canada, plus the company says enterprise customers in Europe are in various testing phases.

Interesting fact: NewStep has filed for more than 16 patents for its Converged Services Node software.

Palo Alto Networks

Founded: June 2005

Headquarters: Alviso, California.

What it offers: A different kind of firewall. The PA-4000 Series network devices, introduced in June, use what the company calls an application-classification technology. This inspects about 450 applications traversing the PA-4000 hardware to apply security rules, regardless of port, protocol or SSL encryption.

Why we like it: The technology is interesting to enterprises frustrated with perimeter security. The PA-4000 works with traditional firewalls to enforce security rules to important applications. Plus, the founders have security and networking industry pedigrees. CTO Nir Zuk worked on some of the earliest firewalls at Check Point Software and later founded OneSecure, which was acquired by NetScreen Technologies (now Juniper Networks). The company has continued to create market buzz since our October profile, and is being looked at by increasing numbers of enterprise users. Here's one example of what's being said about it in the blogosphere: "Prediction: Fortinet will have SSL inspection on their Fortigate line of products within 12 months. Why? Because their new competition, Palo Alto Networks, has it and Fortinet will need to add it or get kicked to the curb," says Jon Robinson, security industry watcher, on Jon's Network.

How it got its start: Over time, CTO Zuk observed that the relationship between ports and applications was diminishing, and he devised a method to look at the content itself through a new type of firewall he had invented. He selected the company name for where he reportedly lives -- Palo Alto, Calif.

Management: In addition to Zuk, co-founders include Dave Stevens and Rajiv Batra. Stevens was venture partner at Foundation Capital and previously CEO of Rhapsody Networks (acquired by Brocade). Batra was previously an executive at Peribit (acquired by Juniper), co-founder of VitalSigns Software and an executive at Bay Networks.

Funding: US$28 million from Globespan Capital Partners, Greylock Partners and Sequoia Capital.

Who uses the product: Catholic Charities, Constellation Energy (a 2007 Enterprise All-Star Award winner), Mercy Hospital, the city of Seattle, the state of Pennsylvania, The Reserves Network, Nordson and others.

Interesting fact: Shlomo Kramer, one of the more famous founders of Check Point software, and currently co-founder and CEO of start-up Imperva, is on Palo Alto's board of directors.