Westec secures $20m
DALLAS--Westec Intelligent Surveillance, a provider of video as a service, announced in February it had secured an additional $20 million in equity funding. The investment was co-led by Argonaut Private Equity and Egis Capital Partners (which also recently invested in Alarm.com, see related story on page 27) with support from existing investors.
Additionally, president Kelby Hagar will now assume the responsibilities of chief executive officer.
Hagar said Westec was able to find capital in this difficult environment because its solution solves three major problems currently being faced by its core customer base: small-box retail, quick service and casual restaurants, and its version of financial services, including check-cashing and pay-day-loan facilities.
“Revenues are flat or down,” Hagar said, “so they have to focus on their expenses more ... There are increased security threats, so while they can’t spend more, the need for enhanced security has never been as great ... And the capital budgets have been removed or eliminated. One analyst said that capital budgets have been reduced by 80 percent in commercial America over the last 12 months.”
Through VaaS, he said, you can eliminate most or all of the security guard force, as the system uses two-way audio; businesses can improve their auditing and reduce expenses related to shrink and waste; and because the system is delivered as a service, it is not a capital expenditure.
Hagar said he can save the typical business $8,000-$10,000 a month.
Currently, Westec does 80 percent of its installations with internal staff, and as much as 90 percent of service calls. The company now has staff in the top 30 metropolitan areas in the United States. All of its nearly 10,000 accounts are monitored at its Des Moines central command center.
Westec also uses proprietary DVRs and analog cameras, with a video codec it developed independently of the security industry. The compression algorithm allows Westec to stream eight cameras on a fully live basis with only a 256K upload capacity on site, and records evidentiary-quality footage on the DVR. “And later this year,” Hagar said, “we’ll improve that by 50 percent.”
Hagar doesn’t see the company moving to IP or HD cameras anytime soon: “We understand the limits of the U.S. bandwidth infrastructure.”