Koolspan Secures WiFi, $750K

BETHESDA, Md. -- Koolspan, Inc. today announced Koolspan SecurEdge, a Wi-Fi solution that overcomes a key barrier that is still holding businesses back from adopting Wi-Fi: concerns about security. Koolspan's unique "pluggable" approach to Wi-Fi security makes obtaining secure anytime, anywhere Wi-Fi access with virtual private network (VPN)-like functionality as easy as turning on a personal computer.

The technology – which has already been evaluated by major government agencies, international banking and relief organizations as well as system integrators and VARs – finally makes secure data transmission and authentication on Wi-Fi/802.11 local area network (LAN) networks affordable for small to mid-size organizations and distributed enterprises.

Koolspan SecurEdge uses a lock-and-key approach to securing Wi-Fi transmissions and authentication that identifies the user, not the user's computer. Users simply plug a smartcard-based physical token, a 1-1/4" dongle called the Client Key, into a USB port on their laptop or other computing device. The Koolspan Client Key allows users to secure communications by connecting to a Koolspan "lock" located inside the network. This "lock" is installed behind the access point, regardless of standard and vendor, using a device called the Koolspan SecurEdge Unilock.

Using this connection, Koolspan SecurEdge can automatically verify and authenticate approved users who are accessing any Wi-Fi network, either public or private.

Using the Koolspan SecurEdge Unilock, businesses can secure their workers' Wi-Fi communications even if those users are accessing public network Wi-Fi access points that are not Koolspan-enabled.

Unlike many existing solutions on the market, which require a significant time and monetary investment by an enterprise's IT department, Koolspan makes providing secure Wi-Fi transmissions easy for network administrators. Administrators simply provide Koolspan Client Keys to users and manage these keys using the Koolspan SecurEdge Administrator, a Koolspan SecurEdge locked application that simplifies key distribution as well as adds, changes and deletes. There is no end-user configuration because the Koolspan solution does not require cumbersome encryption software to be loaded onto client devices.

"Mobile workers at small to mid-sized organizations and distributed enterprises are clamoring to use Wi-Fi networks, but businesses have been reluctant to install them due to the cost and complexity of securing Wi-Fi transmissions using VPN, RADIUS server and even 802.11x solutions," said Koolspan founder and CEO Tony Fascenda. "Koolspan removes the boundaries from Wi-Fi security by providing businesses with an affordable method of securing Wi-Fi communications everywhere, even as mobile workers travel and use Wi-Fi hotspots in airports, coffee houses and hotels."

Koolspan-secured Wi-Fi transmissions undergo high-speed 256-bit AES encryption. AES, the industry standard for data encryption, secures the connection between the Koolspan Client Key and lock. To establish the secure connection, a unique piece of information is stored on a Koolspan Key. The information stored on the key is never transferred over the network and is completely hidden from the user. The Koolspan system is based on the same technology used by wireless phones using global system for mobile (GSM) communications technology, which currently secures the wireless transmissions of more than 650 million devices in use worldwide.

"No other wireless security system combines the access provisioning, security, and roaming capabilities of the Koolspan system, "stated Dr. Ashok Agrawala, Director of the MIND (Maryland Information and Network Dynamics) Lab at the University of Maryland, one of Koolspan's beta sites and a center of expertise in wireless networking technologies and related issues. "The simplicity of the Koolspan solution will lead to wireless LANs that are as secure as the wired connections they are attached to, thus overcoming one of the final obstacles to full Wi-Fi acceptance and deployment."

Koolspan SecurEdge products as well as OEM and vertical market applications will be commercially available starting in the first quarter of 2004. Pricing is yet to be determined.

In a separate release:

Wi-Fi security and authentication solutions company, Koolspan Inc., has raised more than $750,000 in seed financing from Nobska Ventures; The Supper Club and other angel investors; the Challenge Fund of the State of Maryland's Department of Business and Economic Development (DBED); The State of Maryland's Technology Development Corporation (TEDCO); and the Maryland Industrial Partnerships (MIPs) program.

Frank Baitman, Nobska Ventures partner stated, "In addition to being the most secure Wi-Fi solution that we've seen, no other product combines the access provisioning, security, and roaming capabilities of the Koolspan system. We believe that Koolspan has the potential to be a major player in enabling accelerated deployment of Wi-Fi in business, government, healthcare, education, hospitality and public hotspots.”

"Our Supper Club members found Koolspan to be the most compelling technology investment opportunity they've reviewed in the past three years,” said Karim Rahemtulla, Club Director (). "Our members include business owners, executives, doctors and other professionals who understand the practical benefits of the technology for use in their businesses. The chance to invest in a successful serial entrepreneur, Koolspan founder Tony Fascenda, was particularly attractive.”

Koolspan's patent-pending solution employs the tamper-resistant, inexpensive, "smart ” token used in hundreds of millions of cell phones worldwide. Users simply insert a physical token, the Client Key, into a USB port on their laptop or other computing device. This gives them access to a Koolspan-enabled network "lock”, which is able to automatically authenticate and secure approved users who are logging onto the network from any location with 256-bit AES encryption. Combining authentication, security and remote access in a single solution, Koolspan technology works with every vendor's wireless access point in the market today and in the future, and is fully compatible with all current and emerging standards.

"Koolspan's solution is a major breakthrough in securing wireless LANs, providing the missing puzzle piece for Wi-Fi transmissions,” stated Dr. Ashok Agrawala, Director of the MIND Lab at the University of Maryland (www.mindlab.umd.edu), one of Koolspan's beta sites and a center of expertise in wireless networking technologies and related issues.

"This financing is a 'bridge' to a larger round with institutional and strategic investors, ” said Tony Fascenda, CEO of Koolspan."This capital will enable us to complete beta tests and build our sales and marketing alliances, maintaining momentum toward commercial introduction.”

Koolspan