Friday, December 4, 2020
In an interview with The Green Sheet, Gabe Moynagh, CEO of Sysnet, called the acquisition a perfect fit and key part of Sysnet's strategic growth strategy. He added that the acquisition will further cement Sysnet's leadership as compliance and security management service provider to nearly 4 million small and midsize businesses and payment processors worldwide.
“As the leading provider of cyber security and compliance solutions for SMBs, Sysnet has experienced exceptional growth in recent years with many of the world’s leading acquiring organizations using Sysnet’s solutions to keep their smaller merchants secure and compliant with PCI," Moynagh said. “Sysnet and ControlScan have worked alongside each other for a number of years. We share a similar culture and an uncompromising demand for excellence. We believe bringing ControlScan MCS under the Sysnet umbrella means we will be able to help more merchants than ever at a time they need it most.”
Matt Loos, chief revenue officer at Sysnet and former executive vice president, business development at ControlScan, affirmed that shared goals and combined expertise create an ideal environment for collaboration. "Incorporating ControlScan MCS into Sysnet will deliver high-impact results to merchant service providers and their SMBs, as well as to the payments industry as a whole," he said in a statement. "Our team is excited to join forces with Sysnet and [maximize] our innovative spirit."
Moynagh and Loos observed that cyberattacks had been escalating before COVID-19 pushed millions of merchants and consumers from physical to digital and mobile channels. For example, The 2019 Global State of Cybersecurity in Small and Medium-Sized Businesses, published by Ponemon Institute in October 2019, found a 21 percent increase in year-over-year attacks against U.S. merchants.
Ponemon researchers also found cyberattacks are becoming more targeted in nature, with 61 percent of respondents characterizing attacks perpetrated between 2017 and 2019, as "severe and sophisticated." These threats escalate as companies increasingly use laptops and mobile devices as entry points to business-critical applications and IT infrastructure, researchers stated.
Additional challenges facing SMBs are staffing and revenue, according to the Ponemon report. "The biggest problem is not having the personnel to mitigate cyber risks, vulnerabilities and attacks (77 percent of respondents), " researchers wrote. "The next biggest challenges are insufficient budget (55 percent of respondents) and no understanding of how to protect against cyberattacks (45 percent of respondents). Since 2017, the challenge of not having sufficient enabling security technologies has decreased from 43 percent of respondents to 36 percent of respondents."
In addition to improving access and affordability to millions of service providers and merchants, Sysnet's MCS offering will help stakeholders stay in sync with ever-changing security trends, Loos noted. This approach is especially critical, he stated, as information security shifts focus from point-in-time compliance to business-as-usual security.
“Our goal continues to be to simplify and streamline merchant user experiences while helping manage risk through the use of integrated security offerings," Loos said. "Sysnet shares this goal, which creates an ideal collaboration going forward.”
Loos added that ControlScan has consistently taken a partner-centric approach to security by helping service providers make security and compliance relatable to merchant customers.
“From a partnership perspective, we have helped payments industry players expertly guide merchants whose business is making money, not security and compliance," Loos said. "We’ve accomplished this by consistently seeking out and implementing new, streamlined methods for protecting SMBs as well as reducing risk on the partner’s behalf. At the same time, we’ve built PCI programs that fit the technologies our partners are deploying to their merchant portfolios, allowing for easy integration and rollout.”
Moynagh pointed out that Sysnet’s Proactive Data Security Service, used by thousands of SMBs in Europe and North America, has been a key growth driver in recent years. The company also raised an equity funding round in 2020 with FTV Capital and True Wind Capital, which has helped fuel growth in North America, he stated.
“As the leading provider of cyber security and compliance solutions for SMBs, Sysnet has experienced exceptional growth in recent years," Moynagh said. "Many of the world’s leading acquirers use Sysnet’s solutions to keep their smaller merchants secure and compliant with PCI."
Loos agreed that both companies are established security leaders. “ControlScan has long been a thought leader and innovator in the world of PCI compliance and data security," he stated. "We were one of the first service providers to focus on educating SMBs throughout the compliance process, and our partner- and customer-centric support is recognized throughout the industry.”
The companies thanked legal counsel for assistance with the transaction. Alvarez & Marsal and Willkie Farr & Gallagher represented Sysnet. Raymond James served as financial advisor, and Sidley Austin LLP served as legal advisor to ControlScan.
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