Science Applications International Corp. (NYSE: SAIC) has invested $5 million in Morpheus Data, a Colorado cloud automation startup, with the intention of integrating that firm's technology into its own cloud platform to help improve service to its government and civilian clients.
The Reston technology and defense contractor is increasingly finding its government agency customers want to use multiple cloud service providers, and Morpheus Data’s software-as-a-service helps companies efficiently manage these disparate services through a dashboard that monitors things like power consumption, computer memory usage and overall cost. It also acts as a control console for cloud systems software that helps development teams, IT, finance and cybersecurity departments monitor cloud use without stepping on each other's toes.
“Nobody has, ‘how do we operate this well,’ figured out,” said Andy Henson, SAIC's vice president of digital innovation, said of managing multiple cloud environments. “It's like you built the whole car and left out the entire dash, so I have no idea if I'm running out of gas or if I'm over-revving my engine. That's what Morpheus is really providing, that dash [for] those individual cloud service providers.”
Giant contractors like SAIC are increasingly investing in tech startups with technologies they can use in serving government clients.Lockheed Martin Corp. (NYSE: LMT) plans to invest $200 million in startups to find companies that provide critical components to its supply chain. Booz Allen Hamilton (NYSE: BAH) launched Booz Allen Ventures LLC to invest $100 million over five years in firms developing artificial intelligence, machine learning, cybersecurity and defense technologies.
For the smaller firms, these partnerships with larger, publicly traded companies offer a way to get in on government contracts that may be too large to compete for on their own.
Based in Greenwood Village, Colorado, Morpheus Data was founded in 2015 and has to date raised nearly $31 million. It has around 85 employees according to LinkedIn.
SAIC’s cloud technology products garner roughly $1 billion in annual revenue for the company. Henson said SAIC will continue to eye investments in smaller companies that could help it better meet clients' needs while, at the same time, giving those smaller firms a leg up. He added that his SAIC is most interested in companies developing technologies around cloud computing, artificial intelligence and data.
“What we're doing [is] looking at those technologies that often can't make it in [the federal contracting space] by themselves," Henson said. “The investments, the acquisitions are all targeted towards what can we bring into a portfolio to build a solution."