Laura Mather is a worldwide expert in combating Internet fraud and was ranked 16th on FastCompany’s annual list of "The 100 Most Creative People in Business" for 2012. In 2008, after several years at the National Security Agency and later working on fraud prevention and anti-phishing at eBay, Laura co-founded Silver Tail Systems.  Today, Silver Tail is the leading provider of predictive analytics to detect and prevent fraud and abuse on websites.  In an interview with Start’HerUp’s Jill Fishbein, Laura talks about her unlikely path to computer engineering, her experience in the public sector and the rewards — and trials — of starting her own company.

Jill: Let’s start with your background.  What was your inspiration for studying math in college?

Laura: When I first applied to college, I wanted to study journalism. It was my Dad who said, “Wait a minute; what you really love is physics and math. Don’t you think you should go into engineering?”  To be honest, at the time I thought an engineer was the person who drove the train. It took me a little while to figure out what engineering was all about.  Then, when I went to Preview Day at the University of Colorado, I visited both the journalism school and the math department.  The math department was simply more fun and that’s how I ended up there.  Having a math background turned out to be fortuitous, because my career involves a lot of vector analysis, which is math-based.  

Jill:  What was responsible for your transition from math to computer science for your graduate studies?  While they are highly related fields, it’s not necessarily the transition that everyone makes.

Laura:  After finishing my undergraduate degree, I applied to a number of graduate schools in applied math. At the time, the kind of research that was getting government funding was called “partial differential equations (PDEs),” which happened to be my least favorite subject. Every time I went to a grad school campus to interview, people would ask me if I was excited about PDEs, and I knew then that I didn’t want to spend the next four to seven years doing PDEs.  On a bit of a whim, I had also applied to the University of Colorado Computer Science Graduate School Program, was accepted, and decided to pursue computer science. It was sort of a fluke just based on my not liking a certain subject, but I’m so thankful now that’s where I ended up.  In some ways, I feel like I’ve stumbled into certain experiences and I was able to harness the advantages of combining different kinds of training and practices.

Jill: How did your graduate experience in computer science lead you to the National Security Agency?

Laura: At the time, the NSA was looking to recruit more women.  I received a fellowship through the National Physics and Science Consortium sponsored by the Agency, a program set up for women and minorities in math and science. It was an incredible fellowship, and actually paid for my grad school. I also did two summer internships at the NSA.  After I graduated, my first job was with the NSA’s Applied Math Program. That three-year program brought in a bunch of Ph.D.s like me to spend six months in six different organizations to learn the basics of the Agency. 

Jill: You mentioned that the NSA was actively working to recruit more women. Were women relatively uncommon at the Agency while you were there?

Laura: It’s a very male-dominated organization; of the 30 or so participants, four were women.  Also, we frequently collaborated with the US military, which tends to not be the most female-friendly culture.

Jill:  As someone who has worked for both private Internet security companies and a government security agency, do you think that for-profit companies can combat fraud better than the government?

Laura:  I definitely think it should be a partnership. The government has certain resources and access that different private entities on their own don’t have. Meanwhile, private entities have innovation and agility that the government doesn’t have.  So together it’s the ideal marriage. Still, I don’t know how to make that partnership happen.  From my experience at the NSA, I know it was a huge bureaucracy, and very much an old boys’ network, so it can be a challenge for private companies, particularly smaller private companies, to work with them, although I understand that is changing.  While 9/11 was a terrible tragedy for our country, it also served as an eye-opener for a lot of people in security.  I hear that the government is hiring better people, and that they are trying to be more innovative and more accepting of newer technology. I’m just waiting to see the results of that. 

Jill: From the NSA, you took your experience to the private sector, and spent three years in fraud prevention and anti-phishing at eBay. What specific kind of fraud threats do e-commerce sites face?  

Laura:  With the sophisticated web sites and mobile applications that are being launched, a lot of vulnerabilities are being opened up to criminals.

For example, if I run an e-commerce site and I want to attract more customers, I might offer an incentive so that if a customer signs up and then refers up to 5 friends, I’ll give that customer $5 per friend.  That sounds pretty harmless, right? But I’ve seen many cases where cybercriminals take advantage of situations like that; they just keep creating accounts and signing up friends and suddenly they’ve made $50,000.  Any time you put access to money or data on-line, even when it seems harmless, criminals will find ways to take advantage of it.

In some ways, cybercriminals are able to be more agile than security firms, who need to run quality assurance testing on all of their programs. Cybercriminals don’t need to deal with QA, project planning, releases and meetings. When cybercriminals find new ways to steal money, it takes large corporations a long time to figure out what the heck the criminals are doing. Then it takes an even longer time, sometimes weeks or months, before a fix can be rolled out.

Jill: When did you decide to start your own company?

Laura:  After eBay, I worked for a year and a half at Mark Monitor. That break essentially gave me the time I needed to step back from eBay and look strategically at solving Internet fraud.  I saw so clearly the need for security tools that would be better able to identify attacks quickly and also enable site owners to make changes within minutes, without having to marshal a lot of development resources. I realized, holy cow, if I had just these couple of tools, I could have been so much better. And that’s how the idea of Silver Tail started.

Jill:  What was your biggest fear about starting your own company?

Laura:  I think a better question is, What wasn’t I afraid of?  I can’t think of anything I wasn’t afraid of.  It was very scary financially, because we went without salaries for nine months.  It was also scary professionally. To be honest, I had what I called my “professional judgement paranoia;” I worried that if I tried to start a company dedicated to selling a product or service, people would see me as less of a technology professional.  However, I also I feared that I didn’t know what the heck I was talking about technically.

Jill– What do you mean by that? Wasn’t technology your whole background?

Laura: Yes it was, but I had only done it at eBay.  Maybe out there in the world there was already something that did exactly what our newly developed tools did, but better.  I didn’t know. 

Raising money was tough, because it felt like venture capital investors validated all of those fears.  They tell you that you don’t know what you’re talking about, you don’t understand your market, you’re not going to be able to sell this thing, and you’re not going to be able to recruit the team you want.  They just say that because they need you to prove whether or not you can.  That was probably the toughest nine months of my life.  I had to stand in front of potential investors every day and tell them how much I believed in what I was doing, only to have them tell me I was crazy.  Then I had to get right back up and do it again.

Jill: Are you saying that you had to convince them that you so strongly believed in this company when you actually had your own doubts as well?

Laura: I did.  It’s funny because my co-founder, who is now my husband by the way, said all along that the world needed our product, and that we were moving forward.  I would say, okay if you say so.  I had moments of doubt.  I had never created a start-up, and didn’t know how to start a business or sell a product. I had a ton of insecurities. I just had to put on a good face, act like I knew what I was talking about, and hope that I’d figure it out along the way.

Jill: Did your co-founder put on a good face for your sake, or did he really believe you had something?

Laura:  No, he really believed it.

Jill: Do you think you would have been able do this without a partner or without that particular partner?

Laura: No way. There’s a zero percent chance that I could have.  I’ve been a professional for 15 years or so now, and I definitely feel that the stereotype of women having more insecurities than men rings true for a lot of my women friends. We all seem to have this professional insecurity that I don’t see with men. Even when I talk with men, heart to heart, I don’t sense that they share those professional self-doubts that so many women have.

Jill: How did you overcome your fears?  You clearly did a great job; you got funding, you got a team, and you have a great company now.

Laura:  To move forward, I recalled other times in my life that initially seemed scary to me.  For example, I thought back to when I was a freshman undergrad and my adviser signed me up for a graduate student lab, telling me that he wanted to see how a freshman would do in that lab.   I felt so unprepared and scared at the time.  Yet, I took the class and it turned out very well!  I got to know some grad students who mentored me and they even helped me find fellowships. When I doubt myself, I just think back to examples like that, where I felt scared and it turned out great.  You have to understand that it’s just a fear, and it doesn’t matter.

Another realization came to me while I was raising money. I felt that people would think I was a failure professionally if the company didn’t make it.  Then, one day I realized that I didn’t care what they think.  I’m going to get up every day and do the best darn job I can do, and I’m going to be proud of what I do every day.  I decided that was really all that matters.  It was a very liberating discovery.

Jill: Now that you have a company that is quite successful and will become more successful as time goes on, would you do it again?

Laura:  It’s so much work in the beginning. It takes every ounce of your being.  Let me just say that I’d love to be involved in the very early stages of a company for sure, but being the one or two people who put everything on the line and go without a paycheck for nine months is not easy.  It was very hard to go talk to potential investors and have them tell me my idea had no value.  But I don't have that fear anymore.  So, that is no longer a concern.   But anyone starting a company from the ground up also has her personal, life circumstances to think about as well. 

Dr. Arati Prabhakar has spent her career funding and managing world‐class engineers and scientists to create new technologies and businesses. Last month, she was named as the new Director for the Defense Advanced Research Projects Agency (DARPA).   Here, she sits down with  Jill Fishbein to talk about educating the next generation of technology thought leaders, her experience in private and public technology and lessons learned as a Silicon Valley venture capitalist. 

Jill : Am I correct in assuming that when you were in school getting your bachelors and masters degrees in engineering degrees in applied physics, there were not many women pursuing those degrees?

Arati:  Yes, although there are more now.  At the time, there were a couple of other women in my bachelor’s class at Texas Tech. At Cal Tech, which is a pretty small place,  I was the first woman to get a Ph.D. in applied physics.

Jill:  What led to your interest in electrical engineering? 

Arati:  I was the classic first generation immigrant kid. My mom would literally start every sentence with “when you get a Ph.D.”, and it wasn’t a joke, but I was fine with that. Although I was good in a variety of subjects, I found math and technical pursuits to be more fun.  However, halfway through graduate school I found that I wasn’t really happy with doing very narrow research, and I wondered if I should finish my graduate program, or stop and do something else. Then a friend of mine said, “a Ph.D. is a union card to do research and a calling card to do anything else you want,”  so I finished the program, and am glad I did. 

Jill:  After your academic programs, much of your professional career was spent in the public sector.  How was your transition from the public sector (DARPA and NIST) to corporate life in Silicon Valley, first as Senior Vice President and Chief Technology Officer at Raychem, and then as a venture capital investor? 

Arati:  Now I am at a point in my career where half of my professional life has been in Washington and half has been in Silicon Valley.  The thread that connects the two is a passion for technology and the impact that it has.  Of course, there are a lot of different ways to drive and pursue a deep interest in technology.  It’s so satisfying to be directly involved with technologies driven through business, and that’s the reason I came to Silicon Valley.  I’ve loved that piece of it.  On the other hand, I loved the ability to really think long term about the high-level impact technology can have, which is more of what I got from my Washington life.

The difference between pursuing technological advancement through the public sector and the private sector is the time horizon. I’ve heard what people in Washington say about corporate America and I’ve heard what people in corporate America or in the entrepreneurial community say about Washington.  One of the things we use to say when we were running government R&D programs was that we really have to make longer term research investments.  Then I moved to a publicly traded company and it turns out you can’t even think about next quarter, because you’re so focused on this quarter.  It was a really interesting lesson for me to learn how severely research investment is affected by business pressures that may have nothing to do with the actual research. This meant we had to pay attention to what financial analysts said.

As the technology leader in a company,  your job is to figure out a way to disrupt your own business model before someone does it to you.  Your job is to figure out new directions for your company to go that will create growth.  But analysts go crazy when you want to do something new, because they have your company in a specific category and question why you want to change.  The answer, or course, is If we don't change, we will die.

Jill: When you got your sea legs as a venture capital investor, what kind of companies appealed to you most?

Arati:  Companies using technology to change the ground rules are always very, very exciting to me.  However, it amazed me to really internalize how important the people at young technology companies are.

When I came in the door, everyone into the venture capital world at US Venture Partners, everyone in venture—especially early stage venture—said the people are what really matter. I heard that, and thought that made sense to me and was consistent with all my life experience.  As I got more experience working with young companies, I came to understand how all the stresses that happen in start-ups reveal people’s inner characteristics— who they really are as human beings.  Very quickly, I realized that this is not an intellectual thing.  You really feel in your heart how important these human relationships are when you’re trying to build these companies against all odds.   Everything in a start-up is going to change, the technology is going to change, the market for sure is going to change, the business model is going to have to evolve, and something is going to happen that you had no way to predict.  The only thing you’re left with are these human beings with whom you're trying to build something.  I left the venture world with a much deeper appreciation of having the right people in a young company.

Jill:  In your experience, have you noticed any differences in how successful women approach risk as versus their male counterparts?

Arati:  First and foremost I really hate to generalize; I think we are all victims of generalizations that turn into stereotypes, and I don’t like to go down that path.  The thing that I find that makes technical people super effective is having context for what they're developing and not getting lost in the weeds.  I’ve seen men who are very good at that but I’ve also frequently seen women who are particularly good at going deep into the details and also being able to pull up and see the big picture—see how everything knits together. That’s hugely valuable.

Jill: How do you think young people with deep technical training can acquire that skill?

Arati: As a member of the Engineering Advisory Committee of UC Berkeley, I see that something that people are actively talking about in engineering education.

To be a great researcher, you absolutely have to know how to go deep into the technology and build up at the fine grain level.  To educate engineering leaders or even just effective engineers who are going to function at organizations and be great contributors, they also need to have greater context for their research.  I think universities are struggling with how they can provide more of that, without losing the technical detail focus.  There are engineers who really are really fantastic at the details and are never going to come up out of that to see the big picture; they’re going work on their projects, and that’s great.  But the ones who have an aptitude and an interest in linking those details to the big picture are the ones who end up becoming engineering leaders, VPs of engineering, founders of companies—they might become technical visionaries.  You really need that dynamic range if you’re going to do all those other roles.

Jill: Plenty of college and graduate students dream of being that person in the dorm room who invents something that becomes a company before graduating or before getting an advanced degree.  Are there university programs in technology fields that assist students in creating new companies?

Arati:  There are students in universities who are driven to invent something, to start a company; that’s just what they want to do.  But for every Zuckerberg there are thousands who are not going to do that.  I think that kind of success is great if that happens.  Alternatively, if we give students in technical fields more context in their education, then whether they work in established companies or in start-ups, they’re just going to have a different frame for looking at the world.  I think that will make them more effective when they do decide to start a company 2 or 3 years later. 

However, who knows? When there are whole new industries that are being defined and shaped by radical new business models, and deep technology is not required because the deep technology is just widely available infrastructure—think the already-developed Internet infrastructure and the new business model put forth by social media— it creates an environment that lends itself to that kind of entrepreneurship. But, if you’re going to build something that is about really defining differentiated technology, you actually don’t build that in your college dorm room.  There’s just more technical meat to it.  Generalizing, I think what’s happening with social media doesn't easily extend to other kinds of enterprises.

Jill:  Do you have any advice to offer to women who want to take that step to start their own business?  

Arati:  I would say the same thing to a woman as I would say to a man that wants to start a company.  It’s the same thing regardless of gender.  These are huge life choices filled with the need to understand the trade-offs.  In addition to the business questions of your particular enterprise, there are the human being questions, the life questions.  Arguably when you’re young and you don’t have a mortgage and don’t have a person who is depending on you for stability or income, that’s a good time to take a flyer — but you do want to know as much as possible what you’re getting into.  You'll want to know what the upside is (in addition to the exhilaration and learning that can come from starting a new business) as well as the downside.  Maybe it’s going to be you don’t make it to your cousin's wedding, or maybe you’re not going to be a part of your family for awhile because you become consumed with your new company.  Anyone considering starting a new business must consider the trade-offs and the life choices; perhaps more so than the new technology.

Jill:  Do you think that the trade-offs that one has to make to start a company are different from that path that you took? 

Arati:  I think those questions apply to every fork in the road. These are the hardest, most interesting life decisions that are true about everything you do. A start-up is an extreme example of that, because you know it’s going to eat you alive if you’re going to do it well and the risks are huge, but if you’re truly an entrepreneur there’s no exhilaration like that particular kind.

Jill:  Do you think your girls look at their futures as if anything is possible, or do you think they feel renewed pressure to pick more traditionally acceptable female professional roles?

Arati:  My girls have been raised to believe that it’s important to make a contribution to the world. That may involve technical careers or very different careers, as I strongly believe there are many ways to contribute.  While technology paths are completely accessible to them, they have to feel their own ways through their futures.