Arecont Monster Raise - $80 Million

By John Honovich, Published Dec 01, 2014, 12:00am EST

In the biggest private surveillance industry fundraising event, Arecont Vision has raised $80 million.

However, they have taken an extremely unconventional approach that will likely do more to hurt their future growth than empower it.

In this note, we examine the financial details and explain the pros and cons of the raise.

Debt *****

***** *** ****** *****, **** ** ** $80 ******* **** *****, not ******, *.*., ******* has ** *** **** off.

Payout ** ******** / ************

*** **** ** ***** used ** *** ************. According ** *** ******, $37.2 ******* ** ** is ***** **** *** to ********** / *********, most ******* *** ******* Kaplinsky [**** ** ****** available] *** ********* ******** Berezin [**** ** ****** available].

** ******* *** ******* of *** ******** ** being **** ** ***** investors ** **** ** employees / ****** ********* who **** ******.

Pay *** ******* *******

*** *** ****** ** Arecont ** **** **** get **** ******* ****** to **** *** *******. Many ******* **** ** that ******* ****** *** been ******** *** **** for * ****** ** years *** **** *** price ******* *** ***** high ****** ** ******** a ****.

***, *** *** *********** can ************* **** *** plus *** *** ****** of ******* *** ******* in *** ****** ** a **** ********* **** comes ******.

Downsides - ************ *** **** *******

*** ******** ** **** the *********** **** ********* have**** ************, **** ******, ****** debt ****** ************.

**** ***** ** $** to $** ******* ** annual **** ******** ******** a * - **-**** term *** *** ****. That ***** ******* ***** a *********** ****** ** cash ********* ** ****** back **** ****** **** growing *** *******.

** ********* *******, *** term **** ***** ** under ** '********* ****************' *** *** ** the *** ***** ** that ** *** "**** a ******* ** ***** on *****-**** ******** **** generate **** (** *** off *** **** *** interest ********), ***** ** turn ***** *** ******* to **** *** ********* focus."

Arecont's *********

*******'* ******** ******** ** their *****-****** ********* (*.*, *** ****), ***** ****** *** accounts *** *** ******** of ***** *******. ** also ******* ** ******** with *** ****** ***********. More ************* ****** ** be ******* ** *****-****** competitors (**** *** ** are ********** **** *****) but ** ******* *** now **** ******* ******* a *********** *********** ********* here.

Arecont's **********

*******'* * ******* ******** is ***** ********** *** poor ******* (*.*.,*,*,*) *** *** ******** market *** *** **** high ** *********. *********** *** ****, *** ******* ******** 71% ****** ******, ******** up **** ***** $** million ** **** $** million ** *******. *******, since ****, *** *******'* growth **** *** **** under **% (**** ****** was **% [**** ** longer *********] *** **** / **** ****** ****** them ** **** **** $100 ******* ****** *******, shown ** *** *** filing).

******* ******** **** ********* hurt ****. *** ****** problem, ***, ******, ** that **** ***-**** ************* offer **, *** *** 5MP ******* *** ************* less **** ******* (*.*., ACTi, *******, ***** *** Hikvision).

Overall *******

*** **** **** ** a *** *** *** Arecont's ******** *** ************ as **** *** ** significantly **** ***.

*******, *** ****** **** servicing **** ********* ******. And *******'* ********** *** never *** * ******** focused **********, ** ******* paid *** ******* ************ their ******* *****.

**********, ******, **** ** without **** ****, *******'* biggest ********* **** ** how ** **** *** flood ** ***-**** ********* who *** *********** ***** historical *********** ***********.

****: **** ******* *******'* management **** *** ******* on **** **** **** but *** *** ******** a ********. ** **** update ** **** ******* one.

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