Insider News & Business:October 2012
In this issue:
Datacard Group, Minnetonka, Minn., a provider of secure ID and card personalization solutions, donated more than $17,700 to the Pink Ribbon Foundation supporting the fight against breast cancer.
To help support the cause, Datacard Group developed a Limited Edition Pink Datacard®SD260™ card printer, sold from October 2011 to March 2012.
Datacard Group then donated a portion of the proceeds from each printer sold to the Pink Ribbon Foundation. The company also held an employee fundraising event.
Protection 1, Romeoville, Ill., made two nearly simultaneous announcements that indicate an interesting period of diversification for the company.
First was the news of the new P1 Life program, the company’s first foray into home automation integrated with security. While the company intends to keep security as its primary mission and focus, the new product suite sets out to enhance the customer experience by enabling users to control other household functions, and do it with a smartphone, tablet or computer.
P1 Life incorporates a color, two-way voice enabled touchscreen keypad from Honeywell, the Lynx 5100. Tim Whall, chief executive officer at Protection 1, noted that the panel’s capabilities were an important catalyst in the company’s decision to compete in the security and automation market. “We worked very closely with Honeywell in terms of what we thought the capabilities had to be,” Whall told SDM. “And we thought their new release gave us what we wanted, both in the security aspect as well as the home automation piece.”
Jamie Haenggi, chief marketing officer at Protection 1, added that verifying the company’s field capabilities was also a major piece of getting P1 Life ready. Whall said training technicians to handle new components that are not “one class fits all” such as thermostats, and ensuring they were prepared totrain the end user, was a significant undertaking. A key piece of making technicians comfortable with the new components was getting corporate leaders to understand all the new offering’s nuances. “We didn’t want to learn as we went,” he said.
Protection 1 already offered a mobile app that allowed customers to control their security system remotely, but the concept behind P1 Life is to further assimilate security into the home, adding lighting and thermostat control to that app.
P1 Life is currently being offered to new and existing customers, though Whall noted that the company’s sales force is focused on finding new clients.
Offerings start at $34.99 per month with $99 installation, and the most feature-laden package is $54.99 per month with $349 installation. Packages are customizable and customers are offered a list of products they can add or mix and match.
Hardly a week after announcing P1 Life, Protection 1 closed the acquisition of Newark, Del.-based Integration Logistics, adding new integrated systems capabilities to its commercial and national account security offerings.
Integration Logistics is certified in information technology and voice/telephony services. Its co-founders Ken Schafenberg and John Smolinski will lead the new Integrated Systems Division at Protection 1, bringing their 40 employees with them.
Haenggi explained how the new division fits into the company’s operations: “The Integrated Systems division is significantly more technical than traditional security systems integration,” Haenggi said. “They do a lot of designing, installation and maintaining actual networks. They have a laundry list of IT certifications, so they do much more sophisticated integrations.”
“Now — having a full enterprise integrated system serving the largest of the large — when we come to those opportunities, we already have a group now that understands how to do them, understands how to do the project management,” Whall said. “What we bring to them, of course, is now we have a larger footprint to service. They have no problem doing project management and going out and doing an installation on one of these [projects]. But after the fact, they don’t have an easy way to service it. So now we combine our branch footprint with them and they’re not limited anymore on where they can go. We have more things to offer to the growing base that they had. We expect we’ll probably get a 30 to 50 percent lift in sales in the first year. Meanwhile, we’re increasing the capabilities of what Protection 1 can do.”
Whall commented that the company strives to be the largest full-service security company in the country, bringing “three-door-one-motion resis” at one end of the spectrum together with high-end, complex network integration business and everything in between.
For information, visit www.Protection1.com. — By Sabrina Gasulla, Associate Editor
Securewatch 24, New York, a security company and enterprise level integrator, is entering into the residential intrusion market with a twist to conventional wisdom — no long-term monitoring contract.
Customers will not be asked to sign a long-term contract; instead, the company said customers can select from several lifestyle intrusion packages, own their wireless equipment outright and move it when they want to, as long as they pay a fee upfront that covers installation and other costs. Monitoring is month-to-month.
Jay Stuck, SW24 vice president of sales and chief marketing officer, said that proprietary research indicates that customers resent having to be tied to long-term contracts and to be responsible for the termination fees and other costs associated with relocation or dissatisfaction with alarm company service.
Stuck added, “For the past 25 years, residential security companies have gone to market in the same way — lose money up front to gain the customer and then break even via the monitoring contract months later. When you stop to think about it, the model is no longer sustainable in this economy. What other industry loses money up front on each sale and waits for years to break even — and then hopes to retain the customer for a few more years so they can begin to make a profit by nickel and diming the subscriber? We’ve looked at the future of the residential security business and decided to change the model — it’s a fresh take on the business that is good for SW24 and for our customers.”
SW24 said it realized that the move was not without considerable risk and that it believes the rest of the industry will be watching closely to see if SW24 is successful. The company also said it was not concerned that the new month-to-month monitoring model destroyed the intrinsic resale value of a customer contract that has driven the dealer channel over past decades.
Vince Raia, president of EMC Security, Suwanee, Ga., which offers month-to-month contracts to its monitored customers, concurred that going the no long-term contract route “is not without risks. There will be a cost in the valuation of your business in the event of a sale,” Raia observed. “You are held to a higher standard, since your customers can leave at any time. It can work, and your customers will appreciate the difference, if done correctly.”
SW24’s new marketing concept is being implemented in October of this year in the New York City metro area by SW24’s direct sales organization and will be followed later this fall by a major television advertising push, SW24 said. The company said it is also readying its website and related materials to reflect the strategy.
“The industry is already shedding its old skin without realizing it,” Stuck said. “The success of the ‘summer program’ companies, the rise of the telcos and cable providers and the foothold that do-it-yourself (DIY) Internet sales-based companies have established have all combined to shake up the industry. Inertia is ending. We believe that the security industry and our customers will look back on this move as a game changer for the better.” For information, visit www.sw24.com.
Convergint Technologies, Schaumburg, Ill., a commercial security and life safety systems integrators that is ranked No. 7 in SDM’s Top Systems Integrators Report, partnered with KRG Capital Partners, Denver. With its new partner, Convergint expects to increase its organic growth and pursue acquisitions that will bolster its geographic coverage and expand its high level enterprise integration business.
Convergint Technologies was founded in 2001 and has enjoyed uninterrupted growth for over 11 years with 21 percent year-over-year growth throughout the recession, the company stated. The company got its start installing cameras, card readers and smoke detectors and evolved to focus on deploying and servicing IP-based devices.
Convergint hired William Blair & Company to search for a capital partner that could assist in aggressively expanding the company’s North American footprint, growing its IT-based offerings and continue moving the company to delivering value-added services. KRG Capital Partners, a private equity firm, specializes in building best-in-class industry leaders through the combination of internal growth and selective strategic add-on acquisitions.
Linear, Carlsbad, Calif., a provider of residential and commercial access control, emergency response and security solutions, announced the consolidation of Secure Wireless Inc. All Secure Wireless operations will be integrated with those of Linear during the second half of 2012. Secure Wireless will remain an important product offering and brand in the Linear portfolio, the company stated.
Founded in 2002, Secure Wireless is a manufacturer of radio frequency (RF)-based transmitters and receivers, with a core emphasis on supplying RF devices to a growing number of OEM partners. The company’s products are used in both residential and commercial applications and wireless consumer products.
“The integration of Secure Wireless strengthens Linear’s RF development capabilities while giving us more flexibility to meet the demands of our commercial security and access control customers,” said Duane Paulson, senior vice president of product and market development for Linear. “Linear is already a leader in wireless security solutions but this consolidation gives us more resources to pursue other segments through innovation and product development.”
Secure Wireless customers will benefit from Linear’s training and technical support teams, and, will be unaffected by the consolidation, the company said. The Secure Wireless sales team remains the primary liaison for the product line. Technical and customer support functions, along with other business operations, will be combined at Linear’s headquarters in Carlsbad and at its manufacturing facility in Grand Rapids, Mich.
DICE Corp., Bay City, Mich., held its 9th annual Users Group Conference (DUG’12) in Frankenmuth, Mich., August 6-8. Among the usual array of product enhancements and updates, this year’s conference focused on a few hot industry topics, as well as peer-to-peer discussions.
Discussion topics at the conference this year included automated PSAP communications and mobile capabilities for central stations with DICE’s Matrix Monitoring portfolio. Last year, the ASAP to PSAP protocol used in Houston and Richmond, Va., was a big topic of discussion and that discussion continued at this year’s conference.
“A lot of talk surrounded the ASAP to PSAP program,” said John Williams, central station manager at Alarmco Inc., Las Vegas. The communications protocol allows for automated communications to first responders or public safety answering points (PSAPs) directly from the central station. CSAA and cities are working together to roll out similar programs across the U.S., but adoption is slower than many in the industry would like. Sessions at this year’s conference focused on DICE’s enhancements to its automated PSAP communication software module, as well as pilot program demonstration and experiences from central stations that have implemented the program. “So many of us would love to do this—it would be an enormous help to us as a company if we could blast out information electronically. It’s invaluable,” Williams added.
Mark McCall, director of information technology and facility security officer at United Central Control, San Antonio, Texas, said he spent quite a bit of time talking about ASAP to PSAP and his company’s pilot implementation in 2011. “Many of us in the industry are ready to go, but there are a lot of working parts to coordinate these programs with the PSAPs,” McCall explained. “For us, being live with this in Houston has been a very beneficial tool; it’s so good, it’s hard to measure. There was definitely a lot of discussion and a lot of interest about this again this year.”
In addition, DICE’s Matrix suite, which works with its OpenCore platform, was a buzz-worthy topic of discussion, and demonstrations were a big part of the agenda. Users and DICE employees showed off Matrix capabilities on an array of devices, such as Nooks, iPads, laptops and smartphones.
“Our clients really responded to the various training sessions that operated as an open forum,” said Melissa Courville, head of marketing and communications, DICE Corp. “This allowed attendees to obtain a detailed view of what their software can do. It was beneficial for users to be able to talk to those companies that have piloted the new programs to see how it was working for them with actual statistic pulls on efficiency boosting and ROI.”
Aside from demonstrations and educational sessions, helping fuel an atmosphere of collaboration was DICE’s structure of committees, subcommittees and peer presentations. Last year, the DICE Users Group was restructured from one larger group to form 11 smaller subcommittees. Committees have quarterly telephone conferences to discuss the products, as well as what enhancements and capabilities they would like to see. They vote on their priorities and upgrades are announced and demonstrated at the yearly conference.
The new structure has allowed for directed development work that was lacking in the past, according to Phil DuPont, director of operations at DICE Corp. “With the subcommittees, we’ve really been able to focus on specific aspects of products that people find important, and it provides a way for users to hone in on what they want to get out of the conferences by being able to follow the specific developments they’re interested in,” he said.
Williams, who is a member of three committees, said that the regular interaction with industry peers has been well worth the extra time. “I appreciate the opportunity to be on these committees, since as a smaller company, it’s so important to get our voice heard and also share ideas and help each other with the challenges that all of us in the industry are facing,” Williams said.
Another key focus this year was on best practices — something attendees cited as most beneficial to them. In the past, best practices were always a part of the last day of the conference, however, because of popular demand, they were spread out to include multiple sessions on each day so attendees could gain even more knowledge from their peers, according to Courville.
“Best practices have always been something users have pled with us to never remove, and so this year we did them all throughout the conference in several sessions,” Courville said. “Even if they don’t directly affect the software, these discussions cultivate an environment for solutions.”
According to McCall, being able to speak face-to-face with peers and vendors he deals with regularly over the phone is invaluable. “There was a good deal of best practices this year, which was really helpful, but the biggest benefit for me is the offline discussions with central stations that have similar issues that we have, and also the sponsors and manufacturers,” McCall said. “Being able to have one-on-one conversations with these people is so valuable, it just enhances what we learn in the educational sessions.”
Next year, DICE plans to take that atmosphere of collaboration one step further by rotating locations of its yearly conferences from close to its headquarters to user’s cities so attendees can visit pilot programs and get first-hand experience of how their peers have implemented different applications. DICE will kick off the new format with next year’s conference, which will be held August 5-7 in Grand Rapids, Mich., near Engineered Protection Systems Inc.’s headquarters, the peer host for DUG’13. — By Maggie McFadden Shein, Contributing Writer
Now in its second year, Security Week will once again bring four diverse, yet interrelated, security events together in NYC. The week opens on Tuesday, Oct. 30 with ISC East (Oct. 30-31) at the Javits Center and the Security Week Gala (Oct. 30) at The Lighthouse at Chelsea Piers, followed by the Security 500 (Nov. 1) and Securing New Ground (Nov. 1-2) conferences at the Conrad Hotel. The four events combined attract end users, C-level executives, manufacturers, dealers, distributors, integrators and investors.
ISC East will feature more than 200 exhibitors showcasing new products, technologies and services. For dealers, installers, integrators, and specifiers, the event will focus on retro-fitting and updating to increase profits. For end users, achieving business optimization is the main theme. Both concepts will be supported by key exhibitors and free education. SIA Education @ ISC East delivers high-quality, commercial-free information and insight into the most relevant new products, technologies and strategies in today’s evolving security market — and their application in commercial, residential, institutional and public settings.
The 2012 SIA Security Week Gala will recognize the achievements and contributions of security industry leaders. This year’s George R. Lippert Memorial Award will be presented to Bill Bozeman, president and chief executive officer of PSA Security Network. Rep. Peter King (R-NY), chairman of the House Homeland Security Committee, will receive the Fred V. Morrone 9/11 Memorial Award.
Securing New Ground will provide insightful presentations and discussions by industry thought leaders, productive sessions and networking opportunities where attendees can interact with their peers and with attendees of the Security 500. This event brings C-level security executives and end users of technology together in a dynamic environment. All attendees will receive the 2012 Securing New Ground Annual Report.
Attendees of the Security 500 will have the opportunity to share strategies, solutions and challenges on enterprise security issues with peers and participate in and discuss how security leaders are becoming involved in overall organizational performance. Presentations will be offered by Barry Nixon, executive director of the National Institute for the Prevention of Workplace Violence, and Mark McCourt, author of the Security 500, who will present for the first time the 2012 Security 500.
For information, visit www.securityweekonline.com.
ObjectVideo (OV), Reston, Va., appointed former Tyco executive Warren Brown as president of the company.
Brown commented, “I am excited to be taking the reins at this pivotal time. OV’s analytics software business for OEMs and solution providers is growing in the significant double digits, new patent licensing partnerships are added every month and our R&D Services group continues to expand rapidly. My focus will be on continuing and accelerating this growth, and ensuring OV remains at the forefront of new opportunities and innovations in the field.”
Most recently, Warren Brown was vice president for product management at Tyco Security Products where he oversaw product strategy, roadmap and requirements for that company’s intrusion, access control and video solutions brands.
Milestone Systems, Copenhagen, an open platform company for IP video management software (VMS), will heighten its focus on development by starting up a new international business unit, Incubation and Ventures, which will be based in Silicon Valley, Calif., and at the company’s Danish headquarters.
The goal is to develop new products and services with high potential for market superiority and differentiation and to achieve additional growth by cultivating new Milestone ventures. To steer the new initiatives, Milestone hired an experienced strategist, Lars Nordenlund Friis, as vice president for Incubation and Ventures.
“The Incubation and Ventures business unit will work with groundbreaking innovations that can extend Milestone’s leadership in the industry and accelerate our growth. The team will work with a portfolio process that covers new business areas where we see high potential and integrate these into our main business as they mature. This requires taking a broad view across new technologies and business segments that will continue to build the Milestone vision to enable business optimization through open platform IP video surveillance,” said Lars Thinggaard, chief executive officer and president, Milestone Systems.
The term “incubation” relates to organic product innovations that can be developed and taken to commercial success, and “ventures” signals the intention to build a portfolio of stand-alone businesses, joint partnership ventures or potential mergers and acquisitions, with or without external funding.
IdentiSys Inc., Eden Prairie, Minn., an integrator of identification, card issuance, emergency response and access control/CCTV, acquired the Identification, Security and Presentation Divisions of Mountainland Business Systems, Salt Lake City.
Mountainland Business Systems specializes in digital photo ID systems, embossed card personalization systems, loyalty or membership card systems, smart card/biometric applications, and secure access/access control/CCTV and patient identification solutions to the corporate, government, healthcare, education, membership/loyalty, first responder and emergency management markets in Utah, Idaho, Ore., Nev., Mont. and Wyo.
“This purchase is our 10th identification acquisition in the last seven years and our third acquisition in the past six months. These acquisitions support our constant, targeted, growth strategy to expand our geographic coverage,” stated Michael Shields, founder and chief executive officer of IdentiSys. “Our strategy in this case is targeted expansion further west of our headquarters in Minn. With the addition of the Mountainland Business Systems Divisions, we now offer sales and on-site services in more than 50 percent of the United States.”
Security Service Company Inc., Fleetwood, Pa., acquired the assets of Four Star Electronic Security, a residential and commercial security provider based in Hamburg, Pa.
The Hamburg firm has served hundreds of homeowners and businesses in Berks County and nearby counties for many years with alarm monitoring, service and installation.
Four Star President Merrill Arndt said in a statement to his customers that the new ownership “will maintain the excellent service and affordability we’ve always provided, while also bringing a range of new technological options.”
Among the new services that will be available to former Four Star customers:
• New-generation video security monitoring, with sophisticated home and business options.
• The Personal Emergency Response System, enhancing protection to those who need it.
• Mobile device access and control, enabling easy remote management of all security functions.
• VitalLink® radio solutions to eliminate phone lines.
Since 1973, Security Service Company has safeguarded its customers in eastern and central Pennsylvania and New Jersey. Its staff delivers 24-hour service, ensuring continuous, reliable operation and redundant backup of every security system under the company’s management, the company said in a press release. SSC owns and maintains its own UL listed, CSAA Five Diamond Central Station.
To provide greater redundancy and strengthen the reliability of its network, C.O.P.S. Monitoring, Williamstown, N.J., has opened its fifth central station.
Located in Lewisville, Texas, the new 8,000-square-foot facility is hot redundant and will share alarm traffic with C.O.P.S.’ facilities in New Jersey, Florida, Arizona and Tennessee.
At the helm of the new facility is Derek Kopko, a four-year C.O.P.S. veteran. Since transferring to Texas in December 2011, he has been hiring and training the dispatchers who staff the facility. Industry veteran Gene Reed will oversee sales in the region.
While technology behind the new facility is a main factor in providing reliability, the human element is equally important, said Jim McMullen, president and chief operating officer for C.O.P.S.
“We believe that reliability depends on more than a UL listing and fault-tolerant technology, it also relies on people,” he said. “We are very excited about the launch of our Texas facility and how it contributes to the reliability of our network of central stations. Not only is it equipped with the leading technology, our Texas staff strengthens our team of caring professionals who are committed to providing the highest quality alarm monitoring services.”
ASSA ABLOY acquired Alarm Controls Corporation, a Deer Park, N.Y.-based access control accessories manufacturer.
Founded in 1971, Alarm Controls joins ASSA ABLOY Group brands Securitron and HES to serve and provide greater penetration into the access control market.
“We are very pleased with the acquisition of Alarm Controls by ASSA ABLOY and know this will strengthen our relationships in the access control market,” said Scott Baker, president of ASSA ABLOY Electro-Mechanical Specialties and OEM Group.
Alarm Controls’ suite of products, including door control consoles, push plates, keypads, zone annunciators and magnetic locks, will strengthen ASSA ABLOY’s existing access control portfolio, the company said.
“Alarm Controls is a very exciting addition to the ASSA ABLOY Americas division. This acquisition will allow us to further enhance our ability to serve our customers in this very important market,” said Thanasis Molokotos, ASSA ABLOY vice president and head of its Americas Division.
For a second year in a row, Electric Guard Dog, Columbia, S.C., was named to the 2012 Inc. 500/5000 List of America’s Fastest Growing Private Companies.
The Inc. recognition highlights a year of growth at Electric Guard Dog. The company reported that monthly installations have generated a 74 percent increase in net recurring monthly revenue (RMR) over 2011, including seven consecutive months of new RMR additions that have exceeded any in the company’s 20-year history.
The company also saw a second year climb on the SDM 100, now standing at No. 28.
Chief executive officer Jack DeMao, commented, “We’ve grown tremendously in the last two years and our existing customers and national accounts are a major reason. We continue to support them with our ongoing commitment to providing the highest level of service in the business as well as the most effective theft deterrence system in the United States.”
Electric Guard Dog is a security partner for more than 3,000 commercial and industrial locations across the United States.
After months of speculation, the Blackstone Group, a U.S.-based private equity firm, reached an agreement to buy a majority stake in Vivint, Provo, Utah. The sale, which includes 2Gig Technologies and Vivint Solar, is expected to close later this fall for more than $2 billion.
Vivint’s management team, which is staying intact, has big plans for growth that will be enabled by this new financial partnership. Among them are an entrance into the commercial security space, an in-home healthcare offering and international expansion.
Todd Pedersen, chief executive officer of Vivint, joined SDM for an exclusive podcast to discuss the details of the acquisition. Listen to the interview at www.sdmmag.com.
SDM also reached out to Imperial Capital’s Jeff Kessler to discuss the details and implications of the transaction and valuation. According to Kessler, “The Vivint sale represents a confirmation that if you put together — even if it is from ground up — a company that takes advantage of the surge in new technological capabilities available to end users now can provide a customer value proposition that is highly competitive and highly desired by large players who want to invest in the market.”
As Kessler points out, in the three years that passed since APX Alarm became Vivint, the company made some radical, sweeping changes that led it to be named SDM’s Dealer of the Year in 2011 [Read the full profile in the December, 2011 issue of SDM]. That includes pushing the boundaries of traditional security to offer innovative home services and working to make them accessible and affordable, opening the mass market.
Along with rebranding and building out twin award-winning central stations, Vivint hasn’t stopped moving and creating new sales opportunities, changing its own face as well as the security industry’s.
“The fact that SDM recognized that we are attempting to maybe be part of creating a new definition of a different industry, which is a technology platform industry — that meant something to us,” said Pedersen regarding the company’s status as the most recent SDM Dealer of the Year. “And without question, I think Blackstone looked at the company and said, ‘Look, they have unique capabilities of getting into the home, installing a lot of different things.’”
Pedersen explained that the company will carry out its expansion plans by entering the light commercial space, which he views as an extension of its services, adding that the company already has a good infrastructure to handle national accounts.
Vivint is also working on an in-home healthcare service that would go far beyond what personal emergency response systems (PERS) currently do, Pedersen said. “Everyone in America knows there is a healthcare cost problem,” Pedersen related. “That’s front and center every day. So the contemplation is what can technology do inside a home to track and monitor [different things]… is it vitals? Or analytics around us and movement? We have a pretty broad through-process around the breadth of services that can be offered in that space. I hope we’ll have some form of an offering next year.”
A key feature of the Vivint sale is the company’s proven ability at customer creation while constantly diversifying: first with its home automation services and more recently with a solar energy offering. Pedersen continued, “I think [Blackstone is] looking at this not as a security investment — in fact, I know they’re not. It’s a platform play — a technology services into the home and business technology play. Security happens to be what we got into initially but not how we’re defining ourselves.”
Vivint’s management and Blackstone are currently in the process of ironing out the details of a new form of financing structure for the company. “The financing structure is super important to the growth of the company,” Pedersen noted. “It has to be right capital structure to continue to accelerate growth in all of the services we’re doing, not just the security side.”
Kessler added that in addition to providing capital necessary to sustain that growth, Blackstone will ensure the expansion plans don’t become overly ambitious. “The fact that the owners and founders are still owners but minority owners and that you have a very large private equity firm that has been involved in much larger companies than Vivint with the majority of ownership, it will probably keep Vivint management from exceeding both their man power as well as financial capabilities in expanding — whether it is geographically, vertically or horizontally.”
Regarding what the $2 billion number means to the company, Pedersen said, “It’s a validation of the fact that we’ve been trying to run a great company, provide excellent services and lead out in innovation. I’m very confident that if we were a ‘security only’ company we wouldn’t have gotten the valuation we have. And maybe Blackstone wouldn’t have even looked at us, to tell you the truth.”
To the rest of the security industry, that number supports a buyout trend that shows no signs of stopping. Kessler explained, “Over the past 18 to 24 months, we have seen a whole slew of transactions of larger companies, ranging from Tyco buying Broadview, GTCR buying Protection1, Oakhill Capital buying Security Networks, Summit Partners buying Central Security Group, Ascent Capital buying Monitronics, Bain Capital and Hellman & Friedman buying Securitas Direct, Norwest Ventures buying Alarm Capital Alliance and more recently Cinven buying Pronet, which is the largest alarm company in Turkey. All of these valuations on an RMR basis were in the 40 to 60 area. In the operating cash flow range, which is what we use as the most reliable and accurate measure of value because it takes out all of the accounting variances that alarm companies use (particularly around EBIDTA), that steady state cash flow range has been in the 10 to 13 area.
“Based on what [Vivint] has publicly announced, the [multiple of] RMR appears to be around 50 or the low 50s,” Kessler continued. “And this is just for the part of Vivint that is home services and monitoring; it does not include 2GIG or the solar business, which were part of the sale. If you subtract those two businesses out, we’re just valuating the remaining $1.7 or so billion of enterprise value. In terms of the 10 to13 range for operating cash flow, it’s probably towards the lower end of the range. So it’s not a crazy number. It’s a big number in terms of raw dollars, but the valuation is not insane.”
According to Kessler, a convergence of trends has created favorable conditions for this type of acquisition. These trends include a level of maturity among the top 20 in the SDM 100, opportunities to offer “value proposition that goes beyond traditional legacy monitoring” and the reluctance of some companies to jump on them, baby boomer retirement, and some of the best lenders’ advance rates in history — 30 and better times RMR. “The confluence of all of that means that Vivint is far from the last large, high-quality ticket deal you’ll see in the next year,” Kessler predicted. — By Sabrina Gasulla, Associate Editor
The development of a new UL standard is in the works, and some would say the surveillance industry has long needed it. Video camera performance specifications often are contentious because there is not a standard on which to base those specifications. A camera manufacturer could publish specs based on their own tests, which the camera may or may not live up to, and an integrator or end user would have to take them at their word — or not.
Underwriters Laboratories expects to launch UL 2802, the industry’s first digital video security camera standard, and begin initial certifications in December 2012. “It will be the first of many we’ll have in this digital space,” said Robert Jamieson, Ed.D., general manager, Life Safety & Security Industry, UL LLC, Northbrook, Ill. Related standards in the future could include things such as video analytics and video signal transmission, among others.
A way to think of UL 2802, Jamieson said, is that each camera will be tested to a category classification and a performance level, which offers a cumulative performance score as a result of the test score.
“It looks at the performance characteristics of digital video cameras — in this case just the capture of information at the source,” Jamieson emphasized. “You could have a fixed focus, variable focus, and zoom lens classification. Then a performance level is based on a scoring matrix. You could have a 5, 4, 3, 2 or 1. Your camera would fall into a category and then a performance level. The combination of the category classification and the performance level will indicate that the cameras meet a certain requirement.”
Some of the performance characteristics include: image sharpness, field-of-view, signal to noise ratio, TV distortion, relative illumination, color fidelity, dynamic range, maximum frame rate, gray level, sensitivity, bad (defective) pixel, veiling glare, and several other things such as housing, tamper protection and markings.
Some industry professionals may be familiar with UL 60950, a listing currently held by some cameras. Jamieson explained that UL 60950 is a fire/shock standard; while UL 2802 also includes the fire/shock hazard in its listing, the main purpose of UL 2802 is performance. “We so far have had a fairly warm reception from the community,” he commented. “We’re looking at a relatively inexpensive and quick turnaround time.”
Jamieson said that UL is in the process of forming a standards technical panel that will include members from manufacturing companies, academia, and government. One member, Steve Surfaro, security industry liaison at Axis Communications Inc., Chelmsford, Mass., gave further insight into the role that the standard will have in the industry.
“From the Security and Signaling division at UL LLC comes a new ‘Standard for Safety for Performance Characteristics for Camera Testing.’ This ANSI-approved (American National Standards Institute) standard covers the safety evaluation and performance level testing of digital video cameras relative to standard image-capture parameters. It has been developed out of an industry need for performance-based tiered ratings of surveillance device imaging,” Surfaro said.
He further explained how the standard will benefit systems integrators by guiding them as to the correct camera usage. “The standard will provide users and integrators guidance on approximate fit for a given user application and allow manufacturers to publish their camera image performance ratings on a tiered scale,” he said. — By Laura Stepanek, Editor
THRIVE Intelligence, Dallas, debuted at ASIS 2012. THRIVE’s video-security-as-a-service (VaaS) offering integrates event-based video monitoring, edge-based analytics, audio intervention, GPS tracking, and other alarm monitoring services. THRIVE 360, the company’s flagship combination of technologies, analytics, and real-time monitoring, comes together in THRIVE’S national central command center, located in the Dallas/Ft. Worth Metroplex.
Dean Wilson, chief executive officer of THRIVE, said, “We have created a single platform that combines islands of technology into a simple, intuitive interface for event management, providing quicker notification to first responders, reducing false alarms, and ultimately, increasing safety and security. That we can offer this as a cost-effective, turnkey solution enhances the value for both integrators and end users.”
Using edge-based analytics, THRIVE 360 is an end-to-end video surveillance solution that watches and proactively intervenes during an event. Security rules and protocols are determined and entered into the THRIVE Intelligence system according to each customer’s specifications.
When an alarm or event occurs, it is immediately reviewed by personnel at the company’s command center. The fully redundant facility, with full disaster recovery capabilities, provides monitoring 24 hours a day, 7 days per week.
Live footage of events can be streamed directly to customers and law enforcement officers en route via a smartphone, tablet or computer. In addition, incident reports and non-event footage in storage are provided with the service.
The company also introduced a partner program that provides integrators with dependable, predictable income streams. Integrators who sell THRIVE 360 will receive a monthly revenue split for the life of the contract.
Integrators who offer monitoring services to commercial customers at THRIVE’s top service level can receive up to a $15 per month, per camera commission for the life of the customer relationship, with no cap on the number of cameras. Monthly monitoring for commercial end users costs approximately $60 per month, per camera.
To serve customers with legacy camera installations, whether analog or IP, THRIVE offers an intelligent appliance that plugs into the customer’s network and sends the video signal back to THRIVE’S command center. THRIVE plans a similar residential video security offering in late 2012.
For information, visit www.thriveintelligence.com.
Diebold Inc., North Canton, Ohio, announced that Felix Gonzales was named vice president, strategic initiatives and business development, electronic security. In his new position, Gonzales supports the growth of Diebold’s electronic security business through initiatives and programs that improve the customer’s security and business operations, and enhance the customer experience in account management, project installation, support services, emergency monitoring and online hosted services, across all markets.
With more than 20 years of security and leadership experience, Gonzales comes to Diebold from Stanley Convergent Security Solutions (CSS), where he most recently served as vice president, strategic initiatives and business development. Prior to his work at Stanley, he held the position of vice president national accounts sales for HSM. Gonzales started his career with Honeywell’s security monitoring business where he held key leadership positions including regional director, director national accounts and business unit leader.
“We are very excited to have Felix join our team and I am confident in his ability to help lead the electronic security business,” said Tony Byerly, executive vice president, electronic security, Diebold. “Felix’s extensive security and leadership experience will be highly valuable and enable us to further build and strengthen our security competency in North America and expand the model globally.”
Leveraging a history that spans more than 70 years, Minnesota-based Larco continues to make waves in the security market. Larco, which specializes in automated door systems and other secured entry systems, recently began a collaboration with Datakey, a fellow Atek sister company specializing in keypad systems, on the Guardian II system.
Scott Gardeen, business development engineer of Larco, describes the system as a stand-alone access control system, powered by 9-12 volts. This low power functioning system means that it is capable of being administered to remote areas with the same success as a centralized security system.
Paul Plitzuweit, business development engineer, elaborated on this, stating, “Property management often wishes to control access to building entrances and shared areas such as laundry rooms, party rooms, exercise facilities and swimming pools. Due to the vast distances between these areas, online systems can be prohibitively expensive due to the wiring costs. With the Guardian II system, there are no network wires to run.”
Gardeen commented on the philosophy that drives the new Larco system stating, “We wanted to make a low-cost, full-featured product that didn’t require a software engineer to run. So we designed the software with a left to right approach, with very user friendly screens; simplfying the technical aspects of the program and putting it into a user friendly system. That is why we refer to this system as an IT-free system.”
While this system is streamlined to be user friendly, it certainly does not lack features. Plitzuweit elaborates, “If you want to automatically restrict access to the pool to published pool hours, the schedule feature can do that. If you want to temporarily keep users who are behind in their rent from using the pool, you can remove their name from the admit list until they are current. If you have a party room, you can issue an electronic key that will only give the tenant access for the specific dates/hours that they have reserved. If they lose or don’t return the key it won’t open the party room after that period.”
With three of the four models of controllers that Larco offers weighing in at under $400, and with a purchasing style that does not necessitate bulk shipments, Larco and the Guardian II system allow the user to implement the system in a way that meets their specific needs. — By Grant Gosizk, Contributing Writer
Red Hawk Fire & Security U.S., Boca Raton, Fla., a fire, life safety and security services company, announced the first steps in rebranding efforts and the launch of a new company website at www.redhawkus.com as the transition from Chubb continues moving forward. Comvest Investment Partners announced the purchase of the U.S. fire and security operations of UTC in April and the hiring of industry veterans to lead the company.
Building on its heritage and existing brand equity, the new Red Hawk Fire & Security logo distinguishes fire and security as the central focus of the company’s services and represents the team with a vision to see new technologies for securing businesses, Red Hawk Fire & Security said. The new website emphasizes that team’s expertise and breadth of capabilities in the commercial fire and security industry.
“Red Hawk has earned a solid reputation as a group of local and regional companies, so we wanted to hold on to the existing brand and provide the same great execution with leading technologies and applications across our platform,” said Mike Snyder, Red Hawk chief executive officer.
Part of the rebranding process includes a blending of the individual organizations that make up the new Red Hawk Fire & Security Company, fusing together different strengths and specialties to make up one unified service organization. Noteworthy among the companies now a part of Red Hawk Fire & Security include: National Network Services (NNSI), a single source provider of networking solutions supporting voice, data, video and special systems integration for businesses; Korden Manufacturing, a company manufacturing steel case access control lockers and bank equipment for the past 50 years; and MPA Systems, which offers quick set-up modular buildings for financial institutions and others that require replacement facilities during emergency or disaster situations.
Securadyne Systems, Dallas, and Pamlico Capital completed the acquisition of Surveillance Specialties Ltd. (SURV), a New England-based security systems integrator. The SURV acquisition is the second for Securadyne, which was founded in February 2012 in partnership with Pamlico.
“The acquisition of SURV, which enjoys a commanding market presence in New England, ideally complements our build-up strategy focusing on best-in-breed operating platforms,” explained Carey Boethel, president and chief executive officer of Securadyne Systems. “The addition of SURV considerably expands our geographic reach and our ability to deliver high-end, fully integrated solutions in a number of key vertical markets,” Boethel added.
SURV was founded in 1986 as a covert surveillance company by Arthur and Joan Bourque. The company changed its business model to a full-service systems integrator in 1999. Since then, the company achieved considerable and consistent growth, and emerged as the top independently-owned and operated security systems integrator in New England, Securadyne said. SURV currently has branch offices in Wilmington, Mass. and Portland, Maine.
Arthur Bourque, president and chief executive officer of SURV, stated, “We were fortunate to have a number of viable strategic alternatives for our business, but it was clear that Securadyne represents the future of our industry and is the best possible fit for SURV’s employees, customers and shareholders.”
Bourque joins Securadyne’s board of directors and be active in setting the business’s strategic direction and helping with future merger and acquisition activities. Justin Davis, chief operating officer for SURV, joins the Securadyne Systems executive team and is be responsible for leading the company’s Northeast Region.
Stuart Christhilf, principal at Pamlico, noted, “We are excited to be partnering with Arthur, Justin and the SURV team, as their passion for integrity, quality service, and industry-leading technologies represent exactly what we are trying to build with Securadyne. We expect them to be valuable contributors as we look to expand the combined business going forward.”
Security-Net announced recent new hires from within its 19 North American member companies.
CGL Electronic Security Inc., Norwood, Mass., hired Peter Nillson to fill the position of senior service technician. Nillson has more than 15 years of service and installation experience.
D/A Central Inc., Oak Park, Mich., added Aleksandr Malykh as a senior technician and Lee Womer as service technician.
Future Security Controls Inc., Ottawa, Canada, welcomed Carolyn Hayden as an account manager for the National Capital Region (NCR). Hayden is responsible for all sales-related activities in the Ottawa and NCR regions.
PASEK Corporation, South Boston, Mass., hired Kevin Driscoll to fill a position in safety and security sales. Driscoll is focused on mechanical and electrical security systems sales. He has more than 20 successful years of selling security solutions to commercial end users and brings broad security industry sales and marketing experience.
The Protection Bureau, Exton, Pa., welcomed Brian Bonilla as systems inspector. He has five years of experience in the security industry and is trained in EST Systems. Bonilla also attended Inspectors Camp and is Building Reports certified. The company also hired Joe Zoccolo to fill the position of inspector. He is NICET Level 3 certified and brings more than 40 years’ experience in the security industry.
VTI Security, Burnsville, Minn., added Jessica McCauliff joins VTI Security as a senior account manager. She is responsible for sales and is based in VTI Security’s Denver office.
Vector Security, Pittsburgh, Pa., announced the addition of Brian Van Ness as regional director of residential sales, reporting to Pam Petrow, president and CEO.
Viscount Systems Inc., Burnaby, B.C., opened an office in Washington, D.C. to support its growing U.S. Federal Government client base. The new D.C. office is be headed by Don Williams, national accounts manager for Viscount. The company held an open house at the City Club of Washington in September to introduce Williams and Viscount’s technology platforms to a select list of federal government agencies, system integrators and prime contractors.
PSA Security Network, Westminster, Colo., added Jamie Desmond as marketing coordinator. Desmond will be working closely with the marketing team and is responsible for increasing PSA’s brand awareness through many channels, focusing on social media. Krista Ferndelli previously held this position and has recently moved into the role of director of education. That position was vacated by Sharon Shaw after more than four years of service. Shaw will now fill the role of president for Integrator Support, a PSA Business Solutions partner.
Per Mar Security Services announced Julie Klaus joined the company as director of human resources at Per Mar Centre in Davenport, Iowa. She has more than 20 years of progressive HR experience. Brian Duffy also joined the company as general manager at its Cedar Rapids branch operation. He is responsible for overseeing the electronic security operations for this branch.
Vicon Industries Inc., Hauppauge, N.Y., appointed Dave Charles as director of sales, eastern region. He is responsible for management of Vicon’s sales team serving the eastern half of the United States and Canada.
Advanced Technology Video (ATV), Coppell, Texas, hired Robert Carrino to lead the northeast sales region. Carrino has more than 14 years of experience in the security CCTV market and more than 22 years of sales and business operations experience.
Pivot3, Austin, announced that Paul Kaeley was named the company’s vice president and general manager of services. A core member of the Pivot3 leadership team, Kaeley is responsible for designing, building and leading the services function, ensuring the success of Pivot3’s customers and the profitable growth of the company. Kaeley brings more than 25 years of senior leadership expertise on building and transforming organizations in order to achieve business objectives both on a regional and global basis.
Digital Monitoring Products (DMP) named Matthew Standiford as its dealer development manager for the Southern California region, covering San Bernardino, Riverside, San Diego and Imperial counties. He is responsible for developing new sales and providing on-going service to DMP authorized dealers throughout the region, helping them to grow their businesses.