Businessmodel of Lookout

Customer Segments

Lookout has a segmented market business model, with customer segments that have slightly different needs. The company targets its offerings at consumer, enterprise, and government sectors.

Value Proposition

Lookout offers four primary value propositions: innovation, risk reduction, performance, and brand/status.

The company began with innovation. It bills itself as the first mobile-first security firm, and was the first to uncover a number of major threats. In 2014 alone, it provided the first evidence of malware and spam in Android smartphones as well as proof of the MalApp.D, a VoIP software-based malware.

The company reduces risk by preventing security threats. It utilizes data from all users of its app. This information has enabled it to establish a network of over 100 million mobile device sensors. The sensors provide threat data that, when analyzed by predictive machine intelligence, allows the company to identify patterns and connections that might otherwise go unseen by human analysts. This benefit enables it to predict mobile attacks with a high level of accuracy, and this accuracy only increases as more sensors are added. The company also reduces risk by maintaining high safety and security standards. All information obtained from users through its app is transmitted securely using 128-bit SSL encryption and stored in secure data centers overseen by 24/7 security.

The company has demonstrated strong performance through tangible results. A high-profile example is healthcare provider Buurtzorg, which used Lookout’s solution to protect 8,000 iPads from malware and man-in-the-middle attacks and achieve 100% employee self-remediation of detected threats.

The company has established a strong brand due to its success. With a network of 100 million mobile sensors, it maintains the world’s largest mobile dataset. It has analyzed more than 30 million apps and analyzes as many as 90,000 new apps daily. It is used by the world’s top mobile network operators, including Sprint, Deutsche Telekom, AT&T, and T-Mobile. Lastly, it has won many honors, including an Editor’s Choice Award from PC Magazine, placement on the Forbes 2016 Cloud 100 list, and placement on VentureWire’s 2011 FASTech 50 list of “Most Innovative Technology Startups.“

Channels

Lookout’s main channels for consumers are mobile app stores, while it connects with enterprises and government agencies through its direct sales team. The company promotes its offering through its social media pages and participation in webinars, summits, and conferences.

Customer Relationships

Lookout’s customer relationship is primarily of a self-service, automated nature. Customers utilize the service through the main platform while having limited interaction with employees. The company’s website features an “Insights” section that includes self-help resources such as white papers, case studies, analyst reports, data sheets, and videos. The site also provides a blog with informative articles and answers to frequently asked questions.

Despite this orientation, there is a personal assistance component. Lookout offers e-mail support for consumers. For enterprises, it offers two support plans:

• Standard Support – Clients can obtain e-mail support from technical support engineers during local business hours, and also receive access to the company’s Enterprise Support Portal.
• Premium Support – Clients can obtain phone and e-mail support on a 24x7 basis from a dedicated support employee. They can also receive free advanced training. ### Key Activities

Lookout’s business model entails developing security software and maintaining a cloud-based platform (Lookout Security Cloud) for its clients.

Key Partners

Lookout maintains the following types of partnerships:

• Technology Partners – Leading firms in mobile technology that work with the company to co-develop security solutions in order to provide enhanced offerings for customers. Specific partners include Microsoft, MobileIron, and VMware.
• Enterprise Channel Partners – Value-added resellers, systems integrators, and distributors that promote and sell the company’s solutions to their customers in order to extend its reach. Specific partners include Dimension Data, Optiv, Honeywell, Ingram Micro, Technica, and Emergent.
• Carrier Channel Partners – Mobile carriers, original equipment manufacturers, retailers, and payment gateways that offer the company’s solution to their customers. Specific partners include T-Mobile, AT&T, Sprint, KDDI, Orange, Deutsche Telecom, and Qualcomm. ### Key Resources

Lookout’s main resource is its proprietary software platform, which analyzes data from over 100 million mobile sensors.

It depends on human resources in the form of engineers to maintain and update the platform, sales personnel to promote it, and customer service employees to provide support. The company places a high priority on intellectual property, and has been awarded 75 patents.

Lastly, as a startup it has relied heavily on funding from outside parties, raising $282.34 million from 19 investors as of February 2015.

Cost Structure

Lookout has a cost-driven structure, aiming to minimize expenses through significant automation. Its biggest cost driver is likely research and development, a fixed cost. Other major drivers are in the areas of sales/marketing and customer support/operations, both also fixed expenses.

Revenue Streams

Lookout has two revenue streams:

• Subscription Revenues – Revenues generated from subscription fees charged for access to the company’s cloud-based security platform. Clients can pay $2.99 per month or $29.99 per year.
• Service Revenues – Revenues generated from fees charged to enterprises for access to premium support services, which include 24x7 phone assistance.