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Startups must protect intellectual property

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People will always pay more for things they can not do or do not understand, says Roelof Temmingh, MD of Paterva, developer of Maltego.
People will always pay more for things they can not do or do not understand, says Roelof Temmingh, MD of Paterva, developer of Maltego.

Startups must protect their investments so that they are not copied and make sure that customers are wowed and spread the word in order to succeed.

So said Roelof Temmingh, MD of Paterva - the developer of Maltego, a locally-developed open source intelligence and forensics application. Temmingh was addressing the ITWeb Security Summit at the Sandton Convention Centre this afternoon.

"You can spend years making sure your software can't be copied but legal documents are a lot cheaper. Legal action is a deterrent for big companies," he added.

Maltego is a local tech startup and, according to Temmingh, supplies its technology to 28% of the top companies worldwide; 36% of Alexa top 100 Web sites; and 21% of Fortune 500's top 100 companies. He also pointed out 65% of Maltego clients are in the US; 25% in Europe; 9.97% elsewhere; and 0.03% in SA.

"Our clients include law enforcement agencies like police, military as well as military contractors. IT security experts, investigative journalists, and hackers also make use of Maltego.

It's a kind of magic

When building and selling security software online, entrepreneurs should always bear in mind that magic is expensive and people will always pay more for things they can not do or do not understand, says Temmingh.

According to Temmingh, people spend money on technology either because they do not want to perform a service or do not want to make something. "They also buy because they are lazy or the service is not cost-effective."

"Any sufficiently advanced technology is indistinguishable from magic," Temmingh said, quoting Arthur C Clarke.

Describing the history of Paterva, Temmingh noted that the company was started in April 2007 with the showcasing of the first product - Evolution - at the CanSecWest conference.

However, Temmingh revealed that Evolution was discontinued in August of the same year after Novell argued it infringed its trademark as well as legal threats from Facebook to desist analysing people's information off the social networking site.

Nonetheless, this led to the birth of Maltego in September with some forced protocol changes though nothing was commercial at that stage, Temmingh said. He says the first commercial version of Maltego (version 2.0) went live in May 2008.

Word of mouth

Temmingh encouraged tech startups to get people to say good things about their product if they are to be successful in the market. "If you say something about your product, this is only worth one point; but if someone else says something about your product, it's worth 10 points," he said.

"If you are selling software online, you don't need fancy offices or meeting rooms; fancy cars; or fancy clothes. You do need software to sell; you need a functional Web site; payment workflow that can scale; reliable, mobile Internet connectivity; patience with people as well as flexible working hours."

Temmingh also commented that there is a misconception by tech startups that big companies do not deal with small companies.

"In fact, the big companies, actually want to do business with smaller companies because they do not have the bureaucracies found in larger enterprises. Some of our clients have even advised us to keep small or not to be bought out by a big company to avoid the complications of dealing with a large organisation."

The other misconceptions are that all governments buy from local companies; that you need to know finances; that contracts are a dark art; and that support is really hard work, he added.

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