We had a brief chat with Mikko Hyppönen, the Chief Research Officer of F-Secure, the Finland based online security company. As he’s one of the most vocal representatives of F-Secure online, we wanted to ask him how he feels about the startup potential in online security space. While there are a few really good and interesting companies around, he mentioned that overall there are surprisingly few companies working with online security.

You can follow him on twitter @mikkohypponen or through the F-Secure weblog.

ArcticStartup: What are some of the hottest/most potential startups currently in the area of online security globally and why?

Mikko Hyppönen: First companies that come to mind are Intego and Mylookout, providing Mac OSX and Android antivirus, respectively. However, even these aren’t real startups, as they’ve been in business for a while. However, I forecast that these will be acquired by some major player in the near future. I wouldn’t be surprised to see Apple buy Intego, for example.

Codenomicon, Clarified Networks, WOT and nSense are good examples of local succesful data security startups.

ArcticStartup: Are there any large trends taking place that startups should focus on?

Mikko Hyppönen: SCADA or factory automation security is now smoking hot. After Stuxnet scare last year, practically all power plants, factories and chemical plants are reviewing their security. And there are very few vendors providing consulting or solutions in this area. If I would want to start a new data security company right now, I would focus on this area. Problem is of course that expertise is very hard to find in this narrow sector.

ArcticStartup: Are there many startups in general taking advantages of the possibilities in the online security sector?

Mikko Hyppönen: We see surprisingly few new companies entering this sector.

Traditional antivirus is unusually hard for new startups to enter. This is because the massive backlog of existing malware. Current players have spent years in building detections for those and it’s hard for a newcomer to catch up. Also, automation for antivirus labs requires quite significant data center capability, and this is the kind of stuff you just can’t outsource to a cloud provider.

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