Nice analysis, Julie. Agree with everything you wrote, especially the idea that these companies are positioned to address future MRR opportunities and given their common Hellman-umbrella it appears likely that they will work together with one other to pursue that goal.
COMMENT FROM: Lee Jones; Support Services Group; LeeSSG@att.net
#1.. We believe SimpliSafe has a weak-link in their powerful chain…. their remote monitoring. Hopefully they are now preparing to move all customers into their own next-gen monitoring facilities and technology. Contracting with a traditional, licensed, third-party monitoring firm, like Lydia/C.O.P.S., was a good place to start, however way too much “baggage” for the SimpliSafe business model. “Baggage” like credibility and liability. For example, promote high security, but deliver lower level security. Recent statewide legislation (including FL,TX,GA) targeted licensed monitoring firms (like C.O.P.S, ADT, Moni, EM24, etc), specifically prohibits a call to the police first for emergency response to private deterrent alarm systems. Must call customer first, serious downgrade from customer security expectations. Local police response to private property alarms is going away or already gone (but customers are unaware). Law enforcement will treat SimpliSafe same as other firms under contract and dispatched from C.O.P.S. Traditional, private monitoring firms have lots of nasty legacy liability.
#2… Verisure (another Hellman & Friedman investment) is a good example of a very large private security firm that delivers high end private security around the globe without the aid of public resources. Most countries do NOT offer public responders to private property alarm systems. Private response is the norm. For example, the entire country of France formally practices VR-Verified response. In parts of South Africa, TYCO responds in armored vehicles with a variety of weapons. Maybe the next-gen model in the US will blend SimliSafe and Verisure with highly profitable private911.