Security Systems News

JAN 2016

Security Systems News is a monthly business newspaper that reaches 25,100 security installers, product distributors, central stations, engineers & architects, and security consultants. Our editorial coverage focuses on breaking news in all major se

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NEWS industry," said one reader. Nathan Leaphart, CFO for private-equity owned Electric Guard Dog, said being owned by private equity is a "benefit to management as it forces man- agement to continue to innovate and seek ways to benefit share- h o l d e r s . " The PE own- ers "are also able to pro- vide resourc- e s f r o m a financial and o p e r a t i o n a l expertise perspective that might not be available to a private company otherwise," he said. Tom Gambon, CFO at Isonas, described the place of private equity in the industry this way: "Private equity firms provide much needed growth capital to many companies. Yes, they want to turn a profit on their invest- ment, but they are essential part of small business growth." Nick McAmis, president and CEO and Sentry Security Solu- tions, said, "Private equity gives Industry approves of private equity Only 12 percent of SSN News Poll respondents were pessimistic a small company the opportu- nity to grow, staff, and market at a faster pace allowing them to have a more noticeable pres- ence in the industry and mar- ketplace. "In addition, they can gener- ally offer sound business advice and guidance, which can give y o u r c o r e e x e c u t i v e s t a ff a d i f - f e re n t p e r- spective for b u s i n e s s m a n a g e - ment," McA- mis said. S o m e r e s p o n d e n t s w e r e less enthusiastic about PE in the industry. "Profit is a good thing, and investment is a good thing too, but security compa- nies aren't all in a position to be leveraged for profitability. Market position or footprint does not equate to overall suc- cess," Daved Levine, owner of SCI, said. "[It] depends on their strat- egies, longer term intentions and whether they are playing a straight bat or they are using one play to achieve another," said another reader. Twelve percent of respon- dents believe that PE negative- ly impacts the industry. "These groups inherently are about turning a profit at the expense of both the client and employ- ees," one respondent said. Forty-three percent said they would sell their business to pri- vate equity, and an additional 37 percent said they would sell to a private equity group for the right price. Twenty percent said they would have concerns about how private equity would run the business. "I would vet them the same w a y I w o u l d a n y p o t e n t i a l buyer," Tracy Hendrix, presi- dent and CEO of Femac, wrote in. F o r t y - s e v e n p e r c e n t o f respondents said that they have worked with private equity com- panies in some capacity—49 percent said they haven't yet. Four percent refused to work with PE companies. SSN Have you previously dealt with private equity frms? News Poll based on answers provided by respondents in November and December Would you consider selling your company to private equity? Is private equity interest positive or negative for the industry? Vivint's Matt Mahar discusses home security A s Vivint's VP of consumer expe- r i e n c e , M a t - thew Mahar said he is "obsessed with making sure that any consumer of smart home products gets the best experience that they can, in terms of usability, readability, enjoyment using the system, and … solving real problems." He's involved with both software and hardware design. Prior to starting at Vivint a year-and-a- half ago, Mahar worked with video game company EA Sports and at Nike. Security Systems News talked with him about his home system. What kind of security system do you have? I have the Vivint Sky Control system. I have the smart complete pack- age that we offer with a couple extras thrown in. I have a few extra door/window sensors and a few extra cameras. It's a comprehensive system. … It's got security and monitoring, it's got a smart thermostat, it also has the doorbell camera, [and] the garage door controller. Why this particular setup? It kind of covers all the bases of how I always thought about the smart home. … Having a mobile app that's easy to use is [great]. … My wife loves it; she uses it all the time. For her to say 'hey, this is really simple and easy to use' validates that I'm doing a good job and that it's actually good for a lot of consumers. What is one aspect of your security system that you wouldn't want to live without? If I had to choose one, I think it's the Vivint doorbell camera. … When things get delivered, when I get notifed that someone's been there and dropped something off—I love it. Where do you see security going next? What are some big trends? I see security evolving into something that … every house has. I think it's part of everyday living. I think the way we look at it now is that it's … only for, maybe, a certain category of consumers, but I actually think that [eventually] you'll see it in every single home. One of the reasons why I think that'll happen is because of the mobile phone. I think it's going to be much easier for a homeowner to be aware of what has happened—or what is happening—because you now have a mobile phone. —Spencer Ives How I Use My systeM Mahar uses a Vivint Sky Control at home "I would vet them the same way I would any potential buyer." —Tracy Hendrix, Femac Continued from page cloud-based business model." Customers are taking to the cloud for a number of reasons, he said. End users on the cloud have lower costs, paying per- month versus paying thousands for hardware on their own sites. For dealers and integrators, cloud-based services—hosted video, hosted access, or a combi- nation of the two—can be a prof- itable portion of their business. By Amy Canfeld FOSTER CITY, Calif.— The cloud's benefts to end users, dealers and integrators will lead to more funding for M&A;, according to John Mack EVP, co-head of invest- ment banking and head of mergers and acquisi- tions, Imperial Capital. Cloud is an important theme Like the alarm model, dealers will have to invest up front and get customers to sign a three- to fve-year contract, but there are a number of fnancing options.In some cases, manufacturers may help with fnancing, Mack said. Putting information in the cloud and managed services "go hand in hand," he said. "All physical security systems will be a managed service offering," a m o n g m a n y 2 0 1 5 deals, Mack said, not- i n g , a m o n g o t h e r s , FLIR's recent purchase of DVTEL. Mack was speaking at the Cloud+ confer- ence, held here. Dur- ing "The cloud enables a new security dealer" session, Mack said that "private equity is very interested in the Mack predicted. Manufacturers and integrators are adopting cloud-based busi- ness models. Also, "there are a bunch of startups that are cloud- based." The market opportunity is huge with small- and medi- um-sized businesses, and "the same opportunity applies in the national accounts marketplace," he said. SSN Speaker John Mack, of Imperial Capital, says the cloud could lead to a 'new' security dealer Cloud+: The cloud will enhance M&A; activity John Mack SECURITY SYSTEMS NEWS JaNUaRY 2016 www.securitysystemsnews.com NEWS 3

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