Investors scrutinize emerging security firms at event

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Thursday, May 1, 2003

SANTA MONICA, Calif. - In an innovative event, more than 35 security firms pitched their business plans to middle market investment firms looking to place funding in one of the thriving sectors of the U.S. economy.

The two-day event, held March 3-4, brought together companies as varied as Aeris.net, which markets a proprietary micro burst cellular technology, to Vigilos Inc., maker of a web based software platform that manages security devices, such as intrusion, CCTV and access control from a diverse group of manufacturer. The companies met with investment firms such as the Carlyle Group, Vulcan Ventures and Brentwood Associates.

“It was a wonderful networking event for both public and private companies in the security field to meet with the broader financial community,” said Irv Witcosky, executive vice president of Diversified Security Systems in Saddlebrook, N. J. “Because it was an exclusive, closed event, people were much more open about sharing some very ambitious plans.” Diversified has a marquee security integration contract with the Port Authority of New York and New Jersey for LaGuardia, Newark Liberty International and John F. Kennedy International airports.

The event was sponsored by USBX, an investment banking firm specializing in the security market and Mitchell, Silberberg & Knupp LLP, a law firm with a major practice in M&A in the security market and the firm leading legal action against Los Angeles’ non-response ordinance. The conference was also sponsored by Security Systems News.

Speakers included Leo A. Guthart, the former chairman of Honeywell’s Security and Fire Solutions Group and chief executive officer of Topspin Partners, an investor in the security industry; James Q. Wilson, Ronald Reagan Professor of Public Policy at Pepperdine University; and Peter Michel, chairman of the Security Industry Association’s Homeland Security Advisory Council and former chief executive officer of Brink’s Home Security.

In one of the most cogent remarks during the event, Michel cautioned the assembled guests not to think of Homeland Security as a market, but as a funding source that will take much longer than many pundits believe to affect the marketplace and in a much more limited way.