In 2012, more than $1 billion in venture financing poured into security start-ups, more than double the amount in 2010, according to the National Venture Capital Association. http://www.nytimes.com/2013/08/23/technology/the-pentagon-as-start-up-incubator.html?src=recg  For years, the Pentagon has knocked on Silicon Valley’s door in search of programmers to work on its spying technologies. But these days, it’s the Pentagon that is being scouted for expertise. Entrepreneurs and venture capitalists are finding it valuable to have an insider’s perspective on the national security apparatus when trying to mine large troves of data.
“They have unique insights because they’ve been on the front line,” said Matthew Howard, a former intelligence analyst in the Navy and now a managing partner at Norwest Venture Partners, referring to former military and intelligence operatives who have hatched start-ups. He has invested in several such companies. “Now they’ve got commercial desires. The lines are blurring.”
One of the start-ups is Synack, which promises to vet an army of hackers. The company’s co-founders, Jay Kaplan and Mark Kuhr, met in Fort Meade, Md., in the counterterrorism division of the National Security Agency. They left the agency in February after four years there, and later decamped to Silicon Valley. Within weeks, they had raised $1.5 million in seed money.
Mr. Kaplan said. “The government is doing a lot of interesting things they don’t disclose. You have a unique perspective on what the adversary is doing and the state of computer security at a whole other level.”
Both men’s college educations were paid for by N.S.A. scholarships — Mr. Kaplan at George Washington University, Mr. Kuhr at West Point Military Academy and then at Auburn University. With that came an obligation to work at the agency, which they did, each for four years.
Morta Security, another of the start-ups, was founded by Raj Shah, a former F-16 fighter pilot for the Air Force in Iraq. He described himself as “a policy adviser” to the N.S.A. Morta’s work is in such “stealth mode,” in valley parlance, that the company has said nothing about what it is working on. Nor would Mr. Shah describe fully what his two co-founders were doing at the agency before they formed the company.
“Both sides like to maintain a myth of distant relations. The ties have been in place for a long time.”  said Marc Rotenberg, executive director at the Electronic Privacy Information Center in Washington.
The National Security Agency is among the few organizations in the world, along with companies like Facebook and Google, with a cadre of engineers trained in mining big data.

More of interest:

http://www.newsmax.com/Newsfront/ellsberg-obama-police-state/2013/08/22/id/521757