Startup Of The Week: Oversight Systems' Software Helps Spot Mistakes -- And Nefarious ActivityStartup Of The Week: Oversight Systems' Software Helps Spot Mistakes -- And Nefarious Activity

Financial irregularities, from simple errors to outright fraud, have a direct cost to the business. Oversight Systems' software sifts through business transactions to spot common mistakes as well as anomalies that may indicate nefarious activity. The software is available for on-premises deployment or as a service.
--Andrew Conry-Murray OVERSIGHT SYSTEMS PRODUCT: Oversight Audit Data Warehouse, Oversight On-Demand

FUNDING: $7.6 million Series A

PRINCIPALS: Patrick Taylor, CEO and founder; H. Keith Cooley, VP of engineering

INVESTORS: Sigma Partners, Granite Ventures, Adobe Ventures

CUSTOMERS: American Electric Power, Shaw Industries Group

WHY WILL YOU BE AROUND IN FOUR QUARTERS? Taylor expects strong growth because the software promises a substantial return. "Error identification and remediation drive an amazing ROI," he says. "If you are a billion-dollar company and we find one-tenth of a percent of errors and nip them in the bud, that's a million dollars. We haven't found a customer yet that doesn't have errors." BUSINESS MODEL Oversight offers on-premises software and a service. The premises software sits behind the corporate firewall and extracts data from multiple financial systems, including Oracle, SAP, and custom applications. Users of the service, introduced this month, transfer files to Oversight's data center for analysis. The product flags suspect transactions and provides a workflow for problem resolution. Companies can save money by detecting common errors such as duplicate payments. OPPORTUNITY Oversight targets CFOs and internal auditors pressured by Sarbanes-Oxley and other regulations that mandate the integrity of financial reports. Repercussions for failing to meet such mandates can be severe. "You'd never think of running a data center without an exceptions resolution process," says Taylor. He applies the same logic to financial business processes, which require a lot of human-driven data entry and processing. This increases the chance of error--intentional or otherwise. THE BRAINS Founder and CEO Taylor comes from Internet Security Systems and Symantec, where he held product management positions. Cooley was VP of engineering at Internet Security Systems. TIMELINE Read information's Startup City blog