After rebranding with an emphasis on providing home technology services rather than just security nearly two years ago, Utah-based Vivint, formerly known as APX Alarm, was recently acquired by New-York based investment firm Blackstone from its shareholders for more than $2 billion. Additionally, Blackstone will also be acquiring Vivint Solar, the company’s solar panel installation business, as well as security and automation equipment maker 2GIG Technologies.
According to Vivint co-founder and CEO Todd Pedersen, the acquisition by Blackstone will help expand their access to capital, which he said is critical for a company that is growing at their pace in as many different areas as they are.
“We do a lot of other things besides security and some of them are very capital intense,” Pedersen said. “You install a solar system and its $20,000 a system. Now we’re only installing like 20 systems a day, but it’s a lot of capital and we intend to get to hundreds of installs a day at some point. Really, the Blackstone move is partnering with a group that is right there at the top of ability to access the capital markets and the credit markets in an efficient way to help scale the company. For me, this is my first time running a $2 billion company, but we would like to go to $10 billion so having a partner that actually has managed companies that (are worth) $25 billion-plus we think that is a good strategic partnership.”
With this injection of capital, Pedersen said Vivint will be looking to improve and expand on its current technology and service offerings, while at the same time continuing to focus on what the company already does well. Pedersen added that the company will be entering the commercial space with a new panel that will serve as “hub” for a host of services including security. Vivint, which already covers most of North American with the exception of Quebec, also has plans to expand geographically into Australia.
“The commercial push is also going to be new and we’re not really in the commercial space at all (currently) to speak of, but that’s going to be a big focus of ours,” he said. “If you can’t tell, we’ve got pretty big dreams, but we never bite off more than we can chew so it’s one thing at a time.”
While Vivint may have gotten its start purely as an alarm company years ago, Pedersen said that it would have never been valued at $2 billion had they never branched out into other technology sectors, such as home automation and solar energy.
“Fifty-six percent of the customers we added to the platform this year, which will end up being about 190,000 new customers, will have added additional services to their home on top of security,” Pedersen explained. “We have phenomenal (market) penetration with additional services. We intend to have a home audio solution late next summer that we are going to be able to add to the portfolio of services we’re selling to the home. We love security, without question, but we’re definitely not defining ourselves as a security company. Just like when we sell solar, we’re not defining ourselves as an energy company.”
Pedersen said that this acquisition is proof in and of itself of the success of the company’s revamped strategy and rebranding efforts.
“We changed our name from APX Alarm because if you’re out there knocking on doors and you’re selling solar energy… it doesn’t resonate that well,” he said. “It was the right name for what we had been, the wrong name for what we had become or transformed into.”
The acquisition is expected to close before the end of the year. More info: www.securityinfowatch.com/10781870
U.S. Security Equipment Market to Reach Nearly $2B in 2016
While the sluggish economy may have put a damper on the demand for many goods and services over the last four years, a reinvigorated construction industry and an increase in capital investments are expected to push demand for security products in the U.S. to nearly $20 billion in 2016, according to new report from The Freedonia Group.
Among some of the growth drivers cited by the study include a perceived high risk of crime, as well as technological improvements enhancing the speed of operation and ease of use of security systems.
Products closely tied with construction trends are expected to see the most robust sales growth, specifically electronic access control systems and locks which are projected to post the fastest gains of any security product through 2016.
“Advances for electronic access control systems will be driven by technological innovations that allow these systems to employ an increasingly sophisticated array of clearance options that are both more difficult to forge and easier to operate,” the research firm wrote in a statement. “Additionally, falling prices for many types of access control are making these products more accessible to building owners looking to upgrade from conventional mechanical locks.” More info: www.securityinfowatch.com/10771557
Partner Conference Grabs Record Attendance
Distributor ScanSource Inc. based in Greenville, S.C., held its largest-ever Partner Conference, called “Next is Now,” in September. More than 1,000 reseller partners, vendors and employees attended the event. Here’s some of the breaking news from the conference:
ScanSource Security (www.securityinfowatch.com/ 10342338) has developed the industry’s first comprehensive Web-based product selection tool for its reseller and dealer partners. The product, SNAP, was designed by ScanSource Security’s technical team to help dealers find the right product for their end-user customers. ScanSource Inc. also reported at the conference that it had provided $60.7 million in incremental financing support to its partners from January to August 2012. The company expects that number to grow during the remainder of the year. The company’s portfolio of financial solutions includes credit, floor plan financing, leasing and working capital, whereas ScanSource Inc. is able to offer flexible financial solutions to its partners.
“The goal of our Reseller Financial Services team is to expand our reseller partners’ purchasing power through adaptable and flexible financial solutions,” said Tim Ramsey, vice president, Worldwide Reseller Financial Services. “We understand no two customers are alike, so we take a proactive approach that is relationship-driven by understanding the customer’s financial requirements.”