Government cloud provider Vault Systems has issued a minority stake in its business to ASX-listed financial services group Moelis Australia.
In an initial undisclosed transaction, Moelis has acquired an initial 23 percent of the company through the issuance of new shares, with Vault Systems chief executive Rupert Taylor-Price retaining the remainder.
Taylor-Price told CRN the deal would see Moelis support Vault Systems on its plan to invest $350 million into cloud infrastructure in a staged investment through to July 2020. Vault will look to banks, including its current providers CBA and Westpac, and other lenders to join the investment.
Moelis, which has created a fund called the Moelis Australia Government Infrastructure Fund, will offer a balance sheet that supports the predicted growth.
“It's a deal we’ve been working on for about 18 months,” Taylor-Price told CRN. “One of the main requirements was for us to have the business owned, funded and managed within Australia because of the sensitivity of the data we hold, and, as you know, there are challenges in raising equity in the Australian tech space.”
Vault Systems is just one of three providers to have achieved Australian Signals Directorate protected status, allowing them to host highly sensitive government data.
The Sydney-based cloud provider, along with Canberra provider Sliced Tech, became the first companies to be awarded the status in March this year, with Macquarie Telecom gaining certification in September.
In another boon for Vault Systems, the provider has revealed it was selected as the platform for Govpass, the Government's digital identity solutution in development by the Digital Transformation Agency.
DTA chief executive Gavin Slater said: "Privacy and protection of personal information is at the heart of the DTA’s work on digital identity. Building trust in how the government stores personal data is not something we compromise on.
“Vault’s open standards cloud has been the perfect solution for Govpass, providing a level of security and sovereignty that is a critical to making the process of proving who you are to
government simple, safe and secure.”
Taylor-Price said the Moelis deal provides reassurance and validation of his company's strategy and plans for growth.
“Today, the government is spending less than one percent of their ICT budget on cloud, and by 2020 they’re predicting they’ll migrate 50 percent of their workloads to the cloud. The big question I always had is where is all the supply going to come from?” Taylor-Price said.
The Australian Signals Directorate, which is part of the Department of Defence, awards ASD certifications to cloud service providers for specified cloud services. The ASD Certified Cloud Services List (CCSL) also includes AWS, IBM, Microsoft, and Salesforce, but under the unclassified certification.
Microsoft, in a move to lure more government agencies into its cloud, revealed in August it would launch two Azure data centres in Canberra. The company will go live with the new regions, which are based in Canberra Data Centres' Hume and Fyshwick facilities, in the first half of 2018.
That same month, Sliced Tech and Vault Systems both told CRN they were unfazed by Microsoft’s move, with Taylor-Price at the time saying he was sceptical about Microsoft's ability to obtain the seal of approval for Protected data.
“It is my belief that large multinationals will find the challenge of meeting ASD's stringent security requirement insurmountable due to their legacy," he said.
“Using multinational companies to manage Australian data is in conflict with the views of the Australian public as demonstrated by the Information Commissioner's 2017 Australian Community Attitudes to Privacy Survey, which revealed that 93 percent of Australians do not want their data managed overseas.”
Editor's note: It was initially stated that Vault Systems had received a $350 million investment commitment from Moelis Australia. Instead, Moelis, through its fund, will support Vault Systems in a shared investment.