AeroFS lets users share files but keep data on-premise. Its a safer Dropbox, says the company CEO

A startup headed by two Canadian university graduates says it has cloud service that allows staff of organizations to safely share data across wide area networks while keeping data on premise.

Their service, called AeroFS, lets people synchronize and share files behind corporate firewalls.

“Imagine DropBox running on your infrastructure,” says co-founder and CEO Yuri Sagalov – we don’t see data, we don’t store data we don’t touch data.”

Sharing large files without clogging email boxes is something staff at a number of organizations are demanding.

Last month the company released an iOS application.

With or without IT permission they are signing up for services like Dropbox or SkyDrive whose security doesn’t meet compliance standards. In response these services are creating business versions that cost a little more but offer more security and audit features.

Coming at a time when there are increasing revelations about breakins to corporate networks and the seeming ability of the U.S. National Security Agency (NSA) to get at all sorts of information, the company’s launch six months ago was well-timed.

A lot of foreign organizations don’t want to have data stored in the U.S. Sagalov agreed, particularly companies based in Canada, the United Kingdom and German. “Especially post-NSA (revelations) it’s becoming incredibly common as a request. We’re seeing a lot of companies saying ‘We don’t trust American servers, we want to keep our data completely locally.’”

AeroFS offers two services,: Hybrid Cloud, which is administrative services managed by the provider and costs US$10 a user per month; and Private Cloud, which is completely on premise and on costs $15 a month per user. There are volume discounts.

Both involve the installation of a virtual machine on a customer server which integrates with an LDAP or Microsoft ActiveDirectory, and a client for each user. An AreoFS folder on the desktop is used for sharing files.

Sagalov and fellow AeroFS co-founder and CTOWeihan Wang are University of Toronto computer engineering grads. Both were doing post-graduate work in 2010 when they started to work after hours on a file syncing tool. “We didn’t even intend for it to be for businesses at the time,” says Sagalov. “We wanted it something to synch large amounts of data between us. But when starting talked to businesses it became apparent to us there was a need to keep data in sync between people within an organization.”

He applied for the Y Combinator program in Silicon Valley that helps entrepreneurs start companies (including DropBox). It gives a qualifying startup US$20,000 to come to Palo Alto and hone on a project for three months, then pitch it to investors.

Sagalov and Wang ended up raising US$1 million, so decided to stay and open an office and began hiring. The founders raised US$4.5 million in series A funding, have a staff of 13 and a number of customers – the largest of which has 1,000 seats.

Despite taking several years to bring the service to market, Sagalov admits “we’ve been very fortunate.”

In next 12 months AeroFS will add more features, including opening an API so developers can link their apps to it, and an auditing capability so system administrators can better oversee AeroFS traffic.

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