From the January 2011 issue of Entrepreneur
Lookout: Arad Rostampour, left, and Noah Kindler.
Lookout: Arad Rostampour, left, and Noah Kindler.
Photo© Eva Kolenko

A disturbing event inspired Arad Rostampour and Noah Kindler to go into business. In 2009, a friend posted vacation photos on Facebook, including one of his 13-year-old daughter in a bathing suit. More than 80 strangers downloaded the photo, and many of them contacted her.

Rostampour and Kindler realized that just tracking of kids' online histories wasn't enough to keep them safe. So that year, the duo left their jobs in the tech sector (Rostampour was a technical director at HP and Kindler was a consultant at McKinsey & Co.) and launched SocialShield. The San Bruno, Calif.-based company produces a cloud-based application that monitors online activity on social media and other websites for signs of bullying, stalking and other dangers.

SocialShield doesn't prohibit users from engaging in any behavior online and doesn't restrict access to websites. Rather, it acts as watchdog, monitoring children's contacts online, comparing friends and others interacting with the child to names and photos on sexual predator databases. Parents are alerted if there is a match or if there is a contact unrelated to other connections in the child's network, which can be a sign of stalking. The application also analyzes keywords in comments and posts and notifies parents if there are references to drugs, violence and suicide and words commonly used in cyberbullying.

SocialShield's cloud-based approach and its monitoring of nearly 100 sites quickly caught investor attention. Venrock in Cambridge, Mass., led a $10 million Series A round that included U.S. Venture Partners and several Silicon Valley angel investors. SocialShield closed the deal in early October.

Ted Maidenberg, principal of U.S. Venture Partners in Menlo Park, Calif., says that for parents who don't check up on their kids every day, SocialShield is "a powerful tool to help them keep track of what's going on with their kids online."

"One thing that was a surprise to us," Kindler says, "is that many more of our customers' children are bullies than are being bullied, by ganging up on one kid." The parents are usually relieved to learn about it so they can stop it, he says.

The service requires no software download--parents access the application online to monitor their children's activity. After a free 30-day trial, the service costs $10 per month, or $96 prepaid for a year.

In addition to funding expanded marketing, sales and customer service efforts, Kindler says the $10 million investment will be used to develop deeper analytics and more features, including tools to detect malicious fake sites that often are created as part of cyberbullying campaigns.

"When we talk to a parent and explain what we do, they just get it," Rostampour says. "It's obvious to them why they need this service."