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Hotspot Shield

Hotspot Shield is the most utilized consumer VPN service developed by AnchorFree, Inc., a company headquartered in Mountain View, California. Hotspot Shield provides secure, private and anonymous web browsing by encrypting all internet communications. All domains visited via Hotspot Shield are secured and turned from HTTP into HTTPS. Hotspot Shield also protects user identity online, by making each user private as they surf the web. Hotspot Shield runs a malware detection engine in its cloud, protecting its users from 3.5 million malware websites (including malware, phishing, and spam). Hotspot Shield is also used to bypass firewall restrictions on many sites and content that is not available from certain regions or corporate environments. Hotspot Shield acts as an enabler for social networks, news sites, search engines, and other forms of content that are often restricted, blocked or censored. With over 60 million downloads and 10 million monthly active users, Hotspot Shield is the most popular VPN service for desktop computers and mobile phones. Hotspot Shield encrypts and protects 100 million monthly user sessions and more than two billion page views per month. Unlike Antivirus (AV) software, which is used to protect the user’s computers, Hotspot Shield protects each user’s Internet browsing session against online threats currently outside the realm of most consumer AV solutions. It encrypts otherwise unencrypted web pages, protects passwords, personal data, and sited browsed, secures users in Wi-Fi networks, detects and prevents malware, and enables secure and private access to Internet content. Hotspot Shield encourages the use of its product as a complementary solution to users existing antivirus software, while antivirus protects computers, Hotspot Shield protects all Internet browsing and communications.

Company

AnchorFree, Inc. was founded in Sunnyvale, California but is now headquartered in Mountain View, California, with an office in Switzerland. Its location in the heart of Silicon Valley has helped Hotspot Shield with its strategic growth, including partnerships and investments. Its board of advisors includes many notable names from the Valley, and partnerships with prominent technology companies located in the region. AnchorFree was established in 2005 by David Gorodyansky and Eugene Malobrodsky. Gorodyansky and Malobrodsky were childhood friends who went to the same school. Before AnchorFree, the two started another successful start-up, as a college project. AnchorFree was originally focused on developing a system for propagating free and secure Wi-Fi, through a proprietary Wi-Fi ad platform. The company partnered with ISPs and Wi-Fi service providers to offer users free access to their hotspots. The company enjoyed some success, creating free Wi-Fi hotspots in downtown Palo Alto and parts of San Francisco. Then San Francisco Mayor Gavin Newsom promoted AnchorFree, saying “This new service will benefit citizens, visitors, and business and further encourage technology innovation in San Francisco.” Gorodyansky and Malobrodsky were later invited to serve on the Technology Expert Council for Mayor Newsom. Eventually, the Company evolved to provide secure browsing beyond Wi-Fi networks and became a main stream secure browsing solution. The Hotspot Shield software and brand name was first launched in 2007, bringing security and protection to Wi-Fi hotspot, and later to all Internet networks (wired and wireless) and to users on PC’s, Mac’s, iPhones, Android, and tablets. Hotspot Shield’s popularity soon exploded. By 2012 ranking Hotspot Shield as #52 as the most trafficked online destination in the world (according to Quantcast). AnchorFree’s rapid growth has necessitated several changes in office locations. Their original office was “just a little hole-in-the-wall” characterized by bright orange walls and an employee’s domesticated wolf, according to CEO David Gorodyansky. Currently AnchorFree has about 50 employees, headquartered in a large modern office in Mountain View, CA. The walls are still painted bright orange, green and blue. In 2011 AnchorFree released Hotspot Shield Elite, a paid version for PC and Mac which offers more security features. Later that year, Hotspot Shield VPN for iOS (iPhone and iPad) was released. In 2012 Hotspot Shield VPN for Android (phones and tablets) was also released.

Technology

Hotspot Shield encrypts incoming and outgoing network traffic, creating a tunnel between the user’s devices and AnchorFree servers. This tunnel protects user IP addresses and secures all web pages as HTTPS. This allows for safe access to the Internet for users on home, business, and public Wi-Fi networks, including; users surfing from home, business travelers and others from public Wi-Fi in hotels, Internet cafes, airports, corporate offices, and schools. The Hotspot Shield technology may be used to access video content while travelling abroad. There are two Hotspot Shield editions, one free and one paid. The free Hotspot Shield version is ad supported. The premium version, Hotspot Shield Elite, comes with dedicated support, extended malware protection (Malware Protection Plus), faster browsing, and no ads. Hotspot Shield Elite offers Monthly and Yearly subscriptions. Hotspot Shield runs on PC, Mac, iPhone, iPad and Android devices. AnchorFree’s Expat Shield is a service similar to Hotspot Shield, but is intended for use by UK expats, Expat Shield gives users a United Kingdom IP address. This service is very popular with many UK expats, allowing them to access their home content from abroad.

Releases

• Hotspot Shield –Ad-supported freeware for PC and Mac.
• Hotspot Shield Elite – Paid version for PC and Mac. No ads, malware protection, faster browsing, dedicated support.
• Hotspot Shield VPN for iOS – Paid solution for iOS devices (iPhone, iPad, iPod touch)
• Hotspot Shield VPN for Android – Free and paid solution for Android devices (phones and tablets)
• Expat Shield – Ad-supported freeware for PC using a United Kingdom IP address

Reception

Hotspot Shield has received recognition from well-known news sources including The Wall Street Journal, The New York Times, Financial Times, New York Post, BusinessWeek, CNN, MSNBC, Fox, Yahoo, and Fast Company for its commitment to Internet privacy, security and freedom. It has achieved an outstanding rating on CNET and won an Editor’s pick award. It continues to enjoy high ratings and reviews on various sites, including PCMag.com, Softonic.com, Chip.de, Software Informer, brothersoft.com, download3000.com, pcwelt.de, and the Apple App Store. CEO David Gorodyansky has been featured in Fortune magazine and on Forbes, where he also runs a blog on entrepreneurship. He has also been named among the Top CEO’s Under 30 winning the INC magazine 30 Under 30 Award in 2011. Red Herring Magazine, CEOUnder30.com, FastCompany, have also featured David among the top young CEOs. CNN and Fox News have run episodes on national television recommending Hotspot Shield as a solution for preventing credit card and identity theft. Recently popular Youtube channel “Household Hacker” dedicated a video to Hotspot Shield and how the service can improve user security and privacy on mobile platforms. Other Youtube videos related to Hotspot Shield have generated millions of views.

Financials

AnchorFree, Inc. received raised a $6M Series A financing round in 2006 and a $5M Series B financing round in 2008. In 2012, AnchorFree completed its Series C financing round, raising $52 million from Goldman Sachs at an undisclosed valuation. In addition to Goldman Sachs AnchorFree investors and current Advisory Board members include; RENN Capital Group, Bert Roberts (former CEO and chairman of MCI), Esther Dyson, Doug Maine (former CFO of IBM), Subrah Iyar (founder of Webex), Rick Roth (former CEO of OgilvyAction), Greg Coleman (former SVP at Yahoo and president Huffington Post), Kevin Cook (head of Corporate Development at Barracuda Networks.

Business model

Hotspot Shield uses a Freemium business model with both a free and a premium (Elite) version. The free version is ad-supported, while the Elite version has no ads, faster browsing speed, and includes additional security features and dedicated support. Both versions offer unlimited VPN bandwidth. AnchorFree has also opened up its platform for third party partners to distribute Hotspot Shield, using AnchorFree’s global server infrastructure. Partners include consumer software, consumer security, and Internet services companies.

Availability

Users who find the main Hotspot Shield or AnchorFree websites unavailable in certain countries must resort to third party download websites and file-sharing services to download Hotspot Shield. Users from countries where hotspotshield.com or anchorfree.com is blocked can also email one of the following addresses win@afshield.com mac@afshield.com, and will receive the installation file automatically. Android users who cannot access Hotspot Shield on the Google Play store can email android@afshield.com for the APK.

Social Impact

Hotspot Shield enables access to content and information, addressing 600 million users that live in regions with Internet restrictions. Hotspot Shield enables freedom online, by making all information and content available globally. Along with Facebook and Twitter, Hotspot Shield played an important role during the 2011 Arab Spring uprisings around the Middle East and North Africa. When mobile and Internet communication was shut down by regimes, many protesters downloaded Hotspot Shield to access critical services necessary to sustaining the movement. Hotspot Shield users in Egypt jumped from 100,000 to over a million virtually overnight as citizens used it to get on Google, Twitter, and Facebook. It continues to be used by pro-democracy forces in a variety of countries. The many languages that Hotspot Shield is translated into is a testament to its popularity in these regions.