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Speco woos integrators with IP savvy

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Thursday, July 31, 2014

Speco Technologies, a video surveillance manufacturer based in New York, may be best known for its analog solutions, but it is well into IP-based technology these days.

Today, Speco counts 25 of the largest and most sophisticated independent integrators in the U.S as its valued resellers, with Protection 1 as one of its marquee customers.

These are relationships the Speco management team has actively pursued. And, their pursuit of integrators has just begun, they say. The company’s sales, engineering, marketing, training and management are eager to talk about what they’re doing daily to increase the number of security systems integrators who turn to Speco for easy to use, innovative IP-based video technology.

I visited Speco this week, got a look at their headquarters in Amityville, the manufacturing and training operation and had a chance to hear Speco executives talk about their strategy.  

In business since the early 1960s. Speco is a privately held business owned by the Keller family. The company went private on Sept. 10, 2001, the day before the horrific events of September 11, 2001.  

Todd Keller, Speco president and owner, said the business employs about 100 people. In 2008 it broke $100 million in revenue, today it’s “headed back to about $85 million” in 2014 revenue. The company is selling more products, but prices for many products have come down.

All of its products are assembled here at its headquarters in New York and most everything is engineered here or “outsourced in America.” Keller and other management believe that being family-owned gives Speco an advantage over corporations. "We have the flexibility to pursue ideas, to engineer, innnovate, design," TJ Dickson, VP sales and marketing said, adding that Speco constantly tests and evaluates, and re-evalutates its products. It does the same with competitors' products, he said.

It has a warehouse in Amityville and a new warehouse in Reno, Nevada which it opened in April. This new warehouse houses $3 million in inventory and enables Speco to get products to distributors in the west much more quickly and inexpensively.

Corporations use "voice of the customer" Dickson said. "They hear the customer, but I'm not sure they listen to the customer." Because Speco is not a giant corporation, it is able to implement changes quickly, he said.

Speco is well known for some signature products: two way audio; Digital Deterrent; inventing (Keller says) the bullet camera; its wall-mounted DVR. It's also known for private labeling its products for customers large and small. Keller said he'd much rather have an installer's name on a product than Speco's name, saying that if they sell more "Speco wins."

Speco is also well known for its "Intensifier" technology, which several years ago made it possible for analog cameras to "see" in the dark and low light conditions. This September Speco is planning an "all out blitz" to launch its Intensifier technology built into HD IP cameras, according to Peter Botelho, EVP and GM at Speco Technologies.

"It will be a very aggressive launch aimed at a target group of integrators," he said. Botelho said Speco has taken its time and "worked to get it right." Some competitors have similar technology, he said, "but it doesn't perform like ours and when you add [Speco's lower] price point, this is a potential big win for us in IP," he said.

Speco also last week released its SecureGuard Plus, a VMS that "provides access to multiple DVRs, NVRs and IP cameras for remote viewing, playback and other functions." It does not have licensing fees. Botelho said that SecureGuard Plus is "all American programming, American processing, and an All-American idea" that was developed with input from the SecureGuard User Group, which consists of 15 to 20 integrators.  He called SecureGuard Plus "a VMS with some serious plans to take it way beyond [the traditional] VMS." Future versions of this software will "have special features and integrate with some things that we believe others haven't thought of."

Where's Speco heading in terms of software engineering? Developing software that "runs all peripheral devices and does something with the all the data that's collected," Botelho said. "We are well positioned to move into that space," he said. Why? "More than anything we have a management team that has the ability to understand what's really happening at the installer level. ... and that comes from listening," Botelho said.

Speco "listens" in many ways. Its Tech Support department takes between 300 and 500 calls per day. At the end of every month, Speco takes the top 10 issues its Tech Support department has dealt with, assesses those issues, solves them with other department input if necessary and "turns them into a positive," Keller said.

It does the same thing with the products themselves. Speco has a 2 percent rate of return and defective rate of less than a half a percent. All of the returned products are assessed as well. If, for example, a number of products have been returned because they've been damaged by a lightening strike, this may not be a defect, but this is good information for Speco engineers to have as they design a newer version of the product, Keller explained. 

Speco also "listens" to its customers during training sessions. It has invested significantly in bringing its dealers to its headquarters for training. This year it has done more than 100 trainings so far in 2014. It has had 10 different distributors, dozens of independent integrators and all of Protection 1's national account managers to its headquarters this year.

Trainings held at the headquarters are the most effective, Dickson said, because Speco has a chance to talk about the company as well as the products.

Botelho said he also sees the trainings as "built-in focus groups" where engineering, marketing or sales people can learn what Speco customers are looking for.

However, it's important, Dickson said, to be able to execute on what you learn from customers. He said Speco can do this and cited a recent example of an integrator who wanted a special feature on its wall-mounted DVRs, a button that would flash and alerting a local store manager to push the button to download video. "We had it done, designed and the software written within a week. They were blown away," Dickson said.

 

 

Integrator iTech goes with IQinVision

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07/03/2014

INDIANAPOLIS—Mark Nazarenus, president of iTech Digital, an Indianapolis-based integrator of video surveillance solutions, announced it will use IQinVision in its IP and hybrid surveillance packages.

Feenics: Led by industry vet, attracting integrators' attention

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Wednesday, June 18, 2014

Have you heard of Feenics? It’s a new cloud-based access control platform that’s being run by an industry vet and that attracted the attention of some integrators who are demoing, or getting ready to install “Keep” which is Feenics’ first product.

Paul DiPeso, who was most recently with Lenel, is running the show for Feenics as VP and GM, and this week he’s at the Feenics’ office in Ottawa conducting a “voice of the customer” meeting with some integrators, including Alpha Corp, GS Security, Contava, TRL Systems, Open Systems and Koorsen Security.  

I had a chance to speak to Di Peso as well as Skip Sampson and Shannon Martindale from Koorsen, and I’ll have a regular story on the whole Feenics offering next week.

Suffice it to say, Sampson and Martindale are excited about the offering. Sampson believes Keep will be an RMR generator for his company and a product that his customers will like.

Sampson installed Keep at the Koorsen office and tested it for six months. “We gave [developers] feedback and they were quick to acknowledge and implement [some changes],” he said.

He’s sold two systems and “has quite a few in the pipeline,” he said. Asked about hosted and managed services, Sampson said he’s dabbled in hosted video, but he believes that managed access control is "the most viable managed service. You don’t need a huge pipe, huge SAN or attached storage, a DSL works just great,” he said.

And with Keep, which works with standard Mercury panels “there’s comfort that if the customer for some reason doesn't like it, you can put in something else without replacing the infrastructure. I think Sam was wise in doing that. We play on that point.”

Sam is Sam Shalaby, former owner of FSC, who developed the product. Shalaby is still 100 percent owner of Feenics and sits on the board of advisors, but he is not involved in the day-to-day business.

Sampson acknowledged that there are “multiple other products that do similar things, but what’s different with Sam’s is that he didn’t take a product that’s been out there for 10 to 15 years and take the same GUI, and same layout and try to make it work as a hosted product. He started to build it with an integrator’s mindset. It’s not an access control panel-centric product.”

Sampson called it “fresh and new and relevant,” and said it has “kind of a Google look to it.”  

Working with DiPeso are Dave Charles who does business development, Ralph Shillington who is CTO and who developed the original software, and Anthony Shalaby who is running logistics.

Check back next week, for more details on Feenics’ and DiPeso’s go-to-market strategy.

Nemerofsky named CEO of Xentry Systems Integration

Acquisitions are in the pipeline
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06/11/2014

COLUMBUS, Ohio—Xentry Systems Integration, which was formed in January, today announced the appointment of John Nemerofsky as president and CEO.

Interface raises $115m

Installations for new retail customer with 8,000+ locations begin this month
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06/04/2014

ST. LOUIS—Interface Security Systems, an integrator that offers physical security with managed network solutions in a bundled service, has raised $115 million to fund growth that includes adding an important new retail customer.

Xentry acquires Acree Daily Integrated Systems

Tsourides: ‘We have the appetite to grow to be a very large super-regional’
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06/02/2014

COLUMBUS, Ohio—Systems integrator Xentry Systems expects to hit $25 million to $27 million in revenue in 2014, thanks in part to the acquisition, announced May 21, of Acree Daily Integrated Systems, an integrator based here.

David Sullivan named CEO of SDI

Former HID, IR executive calls SDI 'tremendous platform to build a national organization'
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05/21/2014

CHICAGO—Systems integration firm SDI today announced that David Sullivan, whose background includes leadership roles at IR and HID, has been named CEO. David Gupta, founder and former CEO of SDI, will now serve as vice chairman of the SDI Board of Directors.

NWOSS looks to build 'new school' network

Kostelac: More integrators should consider intrusion business
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03/05/2014

LIMA, Ohio-Northwestern Ohio Security Systems, a family owned systems integrator based here, values old-fashioned RMR generation, but it takes a “new school” approach to building its business, John Kostelac, NWOSS VP of sales, told Security Systems News.

Diebold adds three

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02/24/2014

CANTON, Ohio—Diebold in February added three new executives to its leadership team: Rob Raymond, as vice president, global financial sales; CJ Dailey, as VP of electronic security installation operations; and Michael Campbell, as VP, sales operations and development of E

Will Securadyne be the next Convergint?

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Wednesday, January 8, 2014

Will Securadyne be the next Convergint?

That’s a possibility, according to Bill Bozeman, CEO of PSA Security. Bozeman has experience building a systems integration firm and knows both of the players in the Securadyne/Intelligent Access Systems deal that was announced yesterday.

In case you missed it, Securadyne, a start-up integrator founded by Carey Boethel and Pamlico Capital in early 2012, yesterday announced that it has acquired Ron Oetjen’s company, Intelligent Access Systems, one of the most successful and fastest growing regional integrators in the country. Here’s the a link to the story.

I talked to Bozeman today about the deal. He offered his opinion of the union and also discussed the stages of growth for integration companies—and the new challenges that come along with those different stages.

“I know both guys [Carey and Ron] well very well. They’re both PSA Security equity partners and owners. The consolidation, from our perspective, appears to be a good solid one. Carey is building a hell of a company with Securadyne; it looks to be the next Convergint, [and] congratulations to him [for that],” Bozeman said. Convergint is not a member of the PSA Security flock, but Bozeman praised [Convergint Technologies' CEO Dan Moceri] for building a very solid company.

Bozeman identified three growth-stage milestones for integration companies and the specific challenges that arise when companies grow past a certain stage.  Those milestones occur when a company reaches: A.) $3 to $5 million in revenue; B.) $10 - $15 million in revenue, and C.) $50 million in revenue.  

To get to $3 to $5 million in revenues you need to be a strong, entrepreneurial company, but to become a larger company, “You can no longer do everything yourself. You have to have a management team to help you with sales, technical and finance decisions,” he said. “This is a stage that a lot of companies can’t or don’t want to get past,” he said. The reason? They may be happy making a nice living and being the entrepreneur in charge, Bozeman said.

The next stage of growth hits when a company is doing $10 to $15 million in revenue. “They normally have more than one office and they need infrastructure. To get to the next level you need to hire well paid management people, and that can put a strain on profits of a company unless they’re well financed, which is unusual for most integration companies, or if they have a solid RMR model,” Bozeman explained. He also noted that Ron Oetjen had already successfully moved IAS past this stage.  

The third stage of growth is at around $50 million. “That’s when you really start to need a CEO and a senior management team made up of VPs that are experienced and are well paid,” Bozeman said.   

“Carey has already been president of Netversant and Siemens. He’s the ideal guy [to shepherd this company along] because he already knows what it’s like to run a company that’s $70 to $100 million or $200 million and beyond [in revenues],” Bozeman said.

“Carey’s a polished, senior level business guy who’s experienced on the large corporate side as well as on the entrepreneurial side. … And with Ron he’s got a super field general  [who brings with him] a strong middle-management team. Put that with Carey’s existing team and you have a nice equation for further success.”

Bozeman said it’s very important that Securadyne has a financial partner that knows the security business. “That’s an advantage,” he said. Pamlico Capital is a $2 billion Charlotte, N.C.-based middle-market private equity group. Pamlico was an investor in Sonitrol, but exited when that company was sold to Stanley Works in 2008.
Not all capital partners understand the security integration business, Bozeman noted.

Of course, Bozeman said, growing a national integration company is not an easy thing to do. “The proof will be in the pudding.”