How did the company experience such explosive growth? “Work hard,” laughs Dan Holt, general manager for HEIT, which stands for Holt Edington Information Technology, though the company uses only the acronym.
Now one of the largest providers of computer security services in the so-called cloud, HEIT handles the data of nearly 600 banks nationwide and protects their networks from intruders.
The company also stores some banks’ data on its servers, while other banks store their own information. Many of its bank and credit union customers employ few information technology staffers and so rely on HEIT to get bigger jobs done.
HEIT staffers resolve security breaches every day, Holt said.
They once stopped attacks on a bank coming from China, Romania and the United States. Hackers routed traffic from the bank’s website to another website that they created. HEIT stopped the attacks and eliminated the phony site.
It’s a common occurrence, the sort that experts believe will only grow in frequency and sophistication.
Banking and financial service institutions currently spend an average of only 5.6 percent of their information technology budgets on security, according to research and advisory firm Gartner Inc. But information security represents an important component of banking as attacks against financial institutions proliferate.
In September alone, the FBI was examining more than 400 cases of account takeovers by cyber criminals, Gordon Snow, assistant director of the FBI’s Cyber Division, told a U.S. House committee. Those reported cases involved unauthorized wire transfers from bank accounts of U.S. businesses that resulted in attempted theft of more than $255 million and $85 million in actual losses.
“The number and sophistication of malicious incidents has increased dramatically over the past five years and is expected to continue to grow,” Snow told the Financial Services Committee.
Responding to the security need, Holt and Troy Edington incorporated HEIT in Silicon Valley in 2003 and started work in 2004. Holt, who earlier in his career worked in IT security for the U.S. Air Force’s nuclear operations, heard from friends in the banking industry that it needed security services.
He and Edington hired their first employee in 2005, the year they moved to Fort Collins, in part because of its lower cost of living.
Within five years, the company had matured to the point where it could afford to really grow. HEIT bought another company, Simpler-Webb, in 2010 and more than doubled revenue.
Last year, it was HEIT’s turn to be acquired.
Paducah, Ky.-based Computer Services Inc., which posted $164 million in revenue in 2011, bought the company. However, it left Holt in Fort Collins and in charge of its Managed Services division. Among other things, that means HEIT creates most of the division’s jobs in Fort Collins.
Although the number of banks is shrinking at the moment, the market for HEIT’s services remains huge.
The largest banks in the nation employ their own IT departments, but many of the thousands of community banks and credit unions cannot afford to do so, Holt said. Rather than investing in entire IT departments, they can spend less using companies like HEIT.
Moreover, Holt said, “they get much higher-level skill sets than they could ever hire internally.”
That’s not an empty boast.
Every year, information security grows in complexity as banks face numerous regulations from several government agencies. Most recently, those regulations have accompanied the arrival of the Consumer Financial Protection Bureau, formed with the passage of Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.
“You can’t get that knowledge in one person anymore, or two people, or three people,” Holt said. “You need a team, and so that’s what we do.”
HEIT’s team consists of about 60 people who possess proficiency in multiple areas of information security and work in shifts day and night. Even on Christmas morning, HEIT employees can be seen working at the company’s headquarters on East Harmony Road.
Looking ahead, one of the challenges HEIT faces is a dearth of employees with information security training, Holt said. Universities nationwide offer few information security courses and even fewer degrees. Meanwhile, unemployment in the field remains lower than other professions.
Despite the difficulty of finding trained employees, Holt has faith that HEIT will continue to grow in Fort Collins.
“We believe in this area,” he said.