7 hot security companies to watch

There's a rush in security startups looking to tackle everything from identity management to encrypting cloud data. Here are some of the latest companies worth keeping an eye on.

OneID

Headquarters: San Jose, Calif.
Founded: March 2011
Funding: Not disclosed
Leader: Steve Kirsch, co-founder and CEO
Fun fact: Kirsch is a wealthy serial entrepreneur whose lineup of startups have included Mouse Systems, Frame Technology, Infoseek and other firms.
Why we're following it: This week Kirsch is launching OneID for what he calls the "next-generation PayPal" for digital identities. Kirsch says the basic technology, developed with engineers Jim Fenton, Adam Back and Bobby Beckman, is integrated into websites to let users create their own digital identities and hold payment information securely and use it as a form-filling capability. Kirsch also says the firm in the future intends to tackle hard identity issues such as proving age, citizenship and residency. It's a change-the-world infrastructure play, and OneID wouldn't be the first to find out it's hard to change the world. But one company, Salsa Labs, which handles payments and marketing services for about 2,000 nonprofit organizations, says it's integrating the identity and payment technology into its platform and OneID says to expect to hear from other companies supporting it in the future.

IN PICTURES: Hot security upstarts 

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Pwnie Express

Headquarters: Barre, Vt.
Founded: 2010
Funding: No venture-capital funding
Leader: Dave Porcello, CEO and technical lead
Fun fact: Pwnie Express may be a one-man band, but it's profitable.
Why we're watching it: Mark Hughes, director of marketing and sales for the startup, admits it can be hard to get a good phone connection in this rural area of Vermont. But that didn't stop company founder Dave Porcello from coming up with vulnerability-assessment penetrating tools, including one called PwnPlug, that range in price from about $570 to $800. The network penetration tools, largely based on open source, compete with those from Core Security and Rapid7, among others. Pwnie Express is tiny, but with about $300,000 in revenues last year, was profitable.

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