By Eli Groner
From The Jerusalem Post
ROSH HA'AYIN, April 3, 2000
Rosh Ha'ayin-based Whale Communications said yesterday it raised $23 million in a second-stage round of financing last week.
The round was led by The Goldman Sachs Group, investment affiliates of Soros Private Equity Partners LLC, and the BRM Group, which last year also provided seed-stage funding for the company, which is headquartered in New Jersey.
Although Whale did not disclose the percentage of the company allocated to the investors, an insider familiar with the transaction said that the company valuation is roughly $90m. In addition, Network Associates, a supplier of security and availability solutions for e-business, has made a strategic investment in the company.
Whale Communications specializes in security solutions - built on existing security technologies - for electronic business applications. Whale's "e-Gap" technology enables on-line transactions to occur while maintaining a physical disconnection between the external, unsafe network (the Internet), and the internal, highly secured corporate back office.
Whale's security system is based on technology whereby an impenetrable, physical "air gap" is maintained between the untrusted Internet and the trusted internal network. This air-gap technology enables e-Gap to keep a physical disconnection between networks yet provide selective on-line data transfer between the two.
Instead of physically connecting networks, e-Gap provides a device that switches a memory bank between two computers which are each connected to a different network.
"It's different than a firewall in that it doesn't allow a person access to the system, while firewall allows access after determining who the person is," said a BRM spokesman.
The spokesman added that the company's product costs $43,000 and that Whale already has "satisfied customers," although he declined to provide revenue figures.
The BRM spokesman also said that the alliance with Network Associates would be key. "Whale is a hot company in a hot industry - Internet security - and you can't get much better than Network Associates with Internet security," he said.
"We see this agreement as a first step in a strategic relationship," said Network Associates president Peter Watkins in a statement.