Name: Red Cell Associates

Location: Annapolis. The company is part of the Chesapeake Innovation Center.

Funding: It is self-funded and supported by contract revenue.

Big idea: Red Cell brings a military approach to critical infrastructure protection for the civilian marketplace. Co-founders James G. Liddy and J. Michael Barrett, both Navy veterans, work with companies in the water, chemical, transportation, power and other industries to identify security vulnerabilities and figure out how best to address them. Red Cell employs industry engineers to identify areas of vulnerability that could cause "cascading events" that can ripple through a region or an industry. Red Cell makes recommendations for a combination of physical and cyber security measures to mitigate the vulnerabilities.

Where the idea was hatched: "We decided our effort and expertise might be better suited in the homeland," Liddy said. He is a former Navy SEAL commander and Barrett was a naval intelligence officer. "A lot of it is recognizing that the critical infrastructure is in the hands of the private sector," Barrett said. "You have to be able to work with the industry in a way the government is not always able to do. We're trying to bridge that gap."

Example of use: When performing a risk assessment of a chemical plant, Red Cell would start by looking at where the plant is located and asking questions, Liddy said. What is its regional importance? If there were a major event, what would its effect be on the industry? How could it change policies? What surveillance products are in use? How could they be better organized? The answers to these questions guide Red Cell's security recommendations.

Big-name customers: Army National Guard, Mitsubishi Chemical, Deutsche Bank, Sun Valley Rice.

Founded: 2004

Who's in charge: Liddy, president and chief executive; and Barrett, vice president, business development.

Employees: Two -- Liddy and Barrett. They also work with a few dozen subcontractors. Liddy's father, convicted Watergate conspirator turned radio talk show host G. Gordon Liddy, is an active member of Red Cell's board of directors.

Web site:

Partners: Destineer, Hawkeye Systems, Regal Decision Systems, Trident Global Partners, Verrico Associates.

What the name means: " 'Red cell' in the Department of Defense vernacular is the team that thinks like the enemy so you can come up with defenses or offenses to defeat the enemy," Liddy said.

Where will they be in five years? "I think we will broaden out and merge with other security service providers so that we can take our strategic approach down to the ground level to be putting in the services and products we need to build those defenses," Liddy said.

Quote: "The key ingredient to risk management is you have to accept some risk," Barrett said. "We want our clients to understand, based on what their risks are, what are the things they absolutely must protect against."

-- Andrea Caumont

J. Michael Barrett, left, and James G. Liddy started Red Cell Associates to protect companies' systems.