Credit crunch, new players, stats: What's it all mean?
PALM BEACH, Fla.--Owners and executives of alarm companies and capital providers will gather here at The Breakers hotel Feb. 7 through 9 for the 13th annual Barnes Buchanan Conference to explore issues affecting the debt and equity markets that support the alarm industry, the new interesting players in the industry, and the latest industry statistics.
"Owners and executives of alarm companies gain valuable insight into changes affecting critical operating metrics, acquisition valuations, and the requirements of lenders and investors," said Michael Barnes, a partner in Barnes Associates, an investment banking and consulting firm that specializes in the security alarm industry. "Capital providers are able to learn more about the industry, its players and structure, and to rub elbows with the best operators."
In the early 1990s, "after a number of tough years for the industry in terms of attracting capital," Barnes and folks from the law firm of Buchanan, Ingersoll & Rooney "saw other market segments gearing up for major growth, and wanted to make sure the security alarm industry addressed certain lingering issues that were causing friction in the flow of capital."
A number of those issues related to financial reporting, and how value is expressed, such as the "use of multiples of RMR ... that were not being articulated accurately to the capital markets or strategic players in other industries that were interested in the space.
"Additionally, we noted that many stakeholders in security alarm companies were frustrated by the lack of clear framework for understanding what drives values in the industry, how to measure its creation, and how to efficiently communicate with lenders and investors," Barnes explained.
The conference was conceived as a way to bring players from the industry together with capital providers to communicate about these issues. On Feb. 8, Barnes will present a two-hour industry overview, which will include analyses of new Barnes Associates' data on of the "growth rates, the structure of the industry, operating performance metrics, and market values."
Bill Polk of Capital Source Finance, will lead a segment on the debt markets. "Bill is a leading authority on the subject, having been a lender to the industry for almost 20 years," Barnes said. His presentation will focus on changes in the debt markets, including a discussion of how the current credit crunch is, and will affect the industry. "This is a critical topic," Barnes said.
A panel discussion featuring industry investors Mark Ein of Venturehouse Holdings and owner of Kastle System International, Steve Lebowitz of Topspin Partners and Chris Needham of Seguin Partners will "bring to light the thought processes and needs affecting the private equity markets, and help anticipate their effect on the industry moving forward," Barnes said.
Over the years, conference attendees have enjoyed hearing about interesting players in the industry, Barnes said. "This year, we have Alex Dunn of ApxAlarm discussing their innovative sales programs, which in a single summer generated an astounding several million dollars in new RMR. We also will hear from Richard Ginsburg, CEO of Protection One, the third largest alarm company in the U.S., and Louis Stilp of InGrid, an early stage company with an intriguing new product platform and business model."
Jim McMullen of C.O.P.S. Monitoring and Pat Egan of Select Security will participate in a panel on alarm communications and John Koch, president of ADT, will deliver the industry keynote address.
For more information and to register, visit www.barnesbuchanan.com.