Deloitte Indy 100: E-mail virus prevention proves a lot more profitable than cure

SurfControl helps consumers to protect their PCs

Unless you are hoping to enlarge your body parts, buy fake Viagra pills, or ogle at porn then the burgeoning amount of spam e-mail landing in the average inbox is becoming a real nuisance.

Unless you are hoping to enlarge your body parts, buy fake Viagra pills, or ogle at porn then the burgeoning amount of spam e-mail landing in the average inbox is becoming a real nuisance.

No so for SurfControl. The company, which is listed on the London Stock Exchange's TechMark index, specialises in filtering unwanted content on the internet. The proliferation of spam, viruses, Trojan horses and internet worms has helped SurfControl become one of the country's fastest-growing companies, with more than 20,000 mainly corporate customers relying it for safe surfing.

Steve Purdham, chief executive, says: "Internet security is like a Russian doll. First we had porn, then the virus, then spam. You open one doll and there's another underneath. But we are benefiting from this as we provide rich filters for companies." Last month the company reported a 78 per cent rise in pre-tax profits to £2.2m, which was at the top-end of City analysts' expectations.

SurfControl stared life as a division of software company JSB. Purdham and his colleague, Rob Barrow, came up with the idea of developing software to filter unwanted internet content after a trip to California. Both were software engineers and wanted to find a new market for JSB to expand into, so in the mid-Nineties they jetted off to Silicon Valley for inspiration. "We spent many weeks in the coffee shops of Los Gatos searching for ways of getting out of mediocrity. There were two growth stories: one was biotech and the other was the internet. We knew nothing about biotech, so we went for the internet," says Purdham.

The pair developed SurfControl as a division of JSB. But the company really took off when in June 2000 Purdham was promoted as JSB chief executive and Barrow as executive chairman. A few weeks later JSB changed its name to SurfControl.

Although SurfControl was starting life as a stand-alone company just three months after the peak of the internet boom, it managed to keep its head above water through the downturn. Today it is worth just under £190m based on its market capitalisation.

"We are no longer a small company, but we are not big either. We have moved from the second division to the first. Now want promotion into the premier league," says Purdham.

To do this, SurfControl is honing in on the latest internet threats. Purdham identifies "phishing" as one of the biggest. This is where a fraudster sends out an e-mail purporting to be from a respected company or organisation. The e-mail will often contain a link to a genuine website - say a bank or building society - but when the user clicks on it, a fake box will often appear requesting the customer's personal details.

Purdam says it's crucial for SurfControl and its future as a fast-growing company to quickly develop software solutions to prevent threats like this becoming widespread. "We have to go hunting for the big fish." Or should that be phish?