Westpac Group is increasing its stake in QuintessenceLabs to enable the homegrown quantum cyber security company to further expand its global reach.
The bank has upped its stake in the Canberra-based business from 11 to around 16 per cent for an undisclosed sum, an option offered as part of Westpac’s initial investment made in 2015.
QuintessenceLabs, founded a decade ago, offers an encryption key and policy management system backed by quantum generated true random numbers. Its product's highly secure data encryption capabilities are used extensively by Westpac to reduce the risk of identity theft and customer data breaches.
The technology was of increasing importance to Westpac Group's data security efforts, its CIO Dave Curran said in a statement.
“This increased commitment is a further signal of the importance of QuintessenceLabs technology to our capability with respect to data security,” Curran said. “As a major financial institution, data security and protecting our customers is of paramount importance.”
The deal was evidence of Westpac’s approval of the technology, QuintessenceLabs CEO Vikram Sharma said.
"The big thing that comes out of this is the best demonstration of Westpac's happiness with the relationship,” Sharma told Computerworld. “We are really pleased that having experienced us, not only at a board level, but also having used the tech and integrated it into several programmes and projects that they are running at the moment, they were happy to increase that stake."
The additional investment by Westpac would help his company further its global reach and establish new partnerships, Sharma said.
QuintessenceLabs currently has overseas offices in San Jose, California, and representatives on the east coast of the US and in the UK.
In September last year the company announced a partnership with PKWARE, incorporating its true random number generator into PKWare’s encryption platform Smartcrypt. In November it announced a partnership with VMWare to make its SDK qClient available on VMware’s virtualisation product vSphere.
“What we’re now looking to do, during the course of 2017, is really grow that global footprint and push ahead both with direct sales and further growing some of our important strategic partnerships,” Sharma said. “Our broader plan for this year really sees QuintessenceLabs positioned as a globally recognised, market relevant player.”
Westpac Group is connected to QuintessenceLabs beyond its stakeholding. Jon Nicholson, former Chief Strategy Officer for the Westpac Banking Corporation, is the company’s chairman, while Westpac Group’s current chief technology officer Robert Wilson serves as a director.
The ties provided QuintessenceLabs with great links to the wider banking sector, Sharma said.
“The relationship has three elements to it,” he said. “There’s of course the investment piece, there’s Westpac as a customer, but also Westpac as a facilitator to conversations with other banks and financial institutions.
“They’ve been quite forthcoming, as use cases mature and are deployed within the Westpac environment, in helping us take those and either replicate or implement similar solutions with other customers. That third piece will increasingly unfold during the current year.”
Despite being a local success story – referenced as an example “to be proud of” by Malcolm Turnbull in his address to the SINET61 conference last year – Sharma said global expansion could be tough as an Australian company.
“It is a bit of a journey being an Australian company and taking our tech to other countries! Australia has traditionally been recognised for other things than tech,” he said.
However, perceptions were changing, he added.
“We do see a shift. Well informed people in international markets are starting to see that, in certain niche tech areas, fantastic offerings do come out of Australia. That change in perception does open up more commercial opportunities and a greater willingness of international customers to look at, explore and deploy Australia based tech.
“We’re on that journey. We’ve been focused on building a global brand. From day one we recognised that cyber security has to be a global play.”