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LDSR: Growth of Digital Data Drives Need for Cyber-Security Solutions

By M. Marin

OTC:LDSR

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Data443 Risk Mitigation, a wholly owned subsidiary of LandStar, Inc. (LDSR), is a technology company that is developing an ambitious portfolio of cyber-security products and service offerings. In addition to products and services the company develops on its own, Data443 is also conducting an aggressive M&A campaign to complement its internally developed technologies. It has accessed the expertise of several advisors to help conduct this strategy in a timely and cost sensitive way.

Data443 aims to provide a broad range of data security offerings, services and solutions. The company is pursuing a roll-up strategy within the cyber-security space and has announced several completed or pending transactions. 2018 has been a transformational year, in our view, as the company has completed two significant acquisitions, with others in the near- and medium-term pipeline. Management expects that its overall M&A pipeline will produce a combined annual revenue run-rate of roughly $8-$10 million.

The company believes that the need for external cyber-security services is sizable and growing. According to AT&T Cybersecurity Insights, “Small businesses don't usually have access to the resources they need to create and maintain a cohesive cybersecurity strategy. Instead, they should rely on a provider that can plan and roll out the strategy affordably and efficiently.”

Moreover, as enterprise and individuals rely increasingly on digital data, the opportunities for security breaches multiply. There are myriad examples of high-profile cybersecurity breaches, such as the Equifax breach that impacted an estimated upwards of 143 million consumers. Sensitive data that was stolen included Social Security numbers and driver’s license numbers, among other metrics.

According to IDC (International Data Corporation) predictions, “by 2025 the global datasphere – the amount of data created in the world – will grow to 163 zettabytes (that is a trillion gigabytes). That’s ten times the 16.1ZB of data generated in 2016.” The growth in the amount of critical data that needs to be stored, shared and used will drive demand for maintaining the privacy of sensitive information. At the same time, it will lead corporate entities to become more and more vulnerable to data breaches. Industry insiders believe that there is substantially more sensitive data being produced and stored currently than the amount of sensitive data that is being secured. Importantly, this gap is expected to widen. In fact, IDC estimates that nearly 90% of all data created in the global datasphere will require some level of security by 2025, but not even half will be secured.

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