End of the line for cyber security firm as ‘time runs out’

Edinburgh-based Payfont was founded 14 years ago by its chief exec David Lanc

Payfont, the Edinburgh-based cyber-security firm that was last year said to be worth as much as £180 million, has collapsed into administration.

Administrator Donald Mcnaught, restructuring partner at accountancy and business advisory firm Johnston Carmichael, said yesterday that the move will see all 12 of the company’s staff made redundant.

He said Payfont, founded by chief executive David Lanc – a former senior executive at Royal Bank of Scotland’s cards business – had been trying to raise extra funds to continue trading, but “time ran out”.

Lanc, the company’s main shareholder, said he was “deeply disappointed” about the firm going into voluntary administration, adding: “We are doing this before we run out of working capital.

“My sincere thanks go to the incredible Payfont team who have worked tirelessly to build our world-leading technology. Unfortunately, Payfont, as we know it today, will no longer exist.

“We had assembled a highly talented and specialist computer engineering team with sought-after skills. I wish the team well and hope to work with this fantastic band of brothers and sisters again.”

In 2015, the firm secured a £1.2m cash injection, and last year Martin Brassell, the boss of Inngot, a company that specialises in valuing IP, said it could be worth between £107m and £180m.

Payfont was founded 14 years ago and was developing technology designed to protect users’ digital identities and online data.

Mcnaught said: “The difficult decision to enter administration was made by the directors when it became clear that ongoing commitments could not be met from available working capital.

“Efforts had been made in the months leading up to administration to raise sufficient capital to allow trading to continue but unfortunately time ran out for that fundraising exercise to be completed successfully.

“Our objective now is to maximise value for creditors and, ultimately, shareholders.”

Lanc added: “We wanted to build this exciting technology business here in Scotland and we have received incredible support from world-class cyber security specialists at several UK and overseas universities as far away as China.

“I’d particularly like to thank Edinburgh Napier University and Prof Bill Buchanan who has been a fabulous advocate and supporter of our technology. Thanks also to Scottish Enterprise for their support.”

Credit monitoring company Equifax has been ordered by a UK regulator to alert UK customers affected by a cyber attack that saw the data of 143 million people breached.

The request from the Information Commissioner’s Office comes after the US firm said that “criminals” exploited a website application to access its files. The information accessed includes names, credit card numbers, social security numbers, birth dates and driver’s licence numbers.

gareth.mackie@scotsman.com