Locking Up Your E-mail: A New Approach to Encryption

By Jeremy Caplan

Having helped Sergey Brin and Larry Page edit their initial business plan, which turned into some company called Google, Guido Appenzeller knows a fair amount about start-ups. Although he passed on an opportunity to join his Stanford buddies in taking their venture public--what's a couple of billion dollars between friends?--Appenzeller, 34, has followed their lead, co-founding Voltage Security, a fast-growing firm that has more than 150 clients.

Voltage provides encryption software to banks and health-care providers to safeguard financial and medical records. The company also works with government agencies and ran trials with the Department of Homeland Security and Department of Defense to develop secure methods of transmitting and storing government information more quickly and cheaply than current encryption systems allow.

With clients that include California's department of health services, the privately held Voltage is increasing its revenues some 30% every quarter. One advantage the small company has is speed. It takes just days to deploy Voltage software, compared with months for older encryption systems.

To protect data, Voltage uses an identity-based encryption developed by one of Appenzeller's Stanford professors, Dan Boneh. The prof also taught Rishi Kacker and Matt Pauker, both of whom helped found Voltage--stop us if you've heard this one--while working out of their Stanford dorm rooms in 2002.

Voltage isn't fail-safe, nor does it claim to be. "If attackers spend a million dollars to break into a hospital, we can't prevent records from being stolen," says Appenzeller. But, he says, "we make it much harder for them to access private information digitally." E-mail and data protection is just a start. With growing concern about identity theft, Voltage is developing new methods for securing instant messaging and voice-over-Internet-protocol telephone calls.