BRS Labs Financials and Future Examined 2013

Author: Ben Wood, Published on Jun 26, 2013

BRS Labs is one of the most ambitious companies in the surveillance market. While the company has aggressively touted its achievements, IPVM's review of BRS Labs financial documents demonstrates that actual performance lags that significantly. However, BRS Labs is also now touting major new growth opportunities. In this note, we examine BRS Labs financials and future.

[NOTE: BRS Labs sent a letter to IPVM, declining to comment on specific financial details from the document save for emphasizing that, "the majority of which has not been reviewed by its auditors and is not to be relied upon." (emphasis added)]

Claims vs. Numbers

2010

In an 2009 interview with the Houston Chronicle, BRS Labs CEO said he expected to close $10 million in contracts through September 2010, noting projects with a hotel chain in India, the Dubai Airport, "a Southern U.S. Port" and a nuclear power plant.

However, the BRS Labs financial document reports audited 2010 sales at $324,000 vs. $10.6 million in operating expenses.

2011

In April 2011, BRS Labs issued a press release reporting “exponential growth,” boasting that they were "engaged in over $200 million in sales", 20 times what they foreshadowed to the Chronicle.

However, the same BRS Labs document reports audited 2011 sales under $800,000 vs. $15.6 million in operating expenses.

By the end of 2011, total accumulated losses, since inception, of $65+ million were reported.

2012

A “confidential” presentation available online says the company in 2012 had projects "underway" with Amtrak, Massachusetts Bay Transit Authority, Los Angeles County Metropolitan Transportation Authority, Illinois Regional Transportation Authority and Washington Metropolitan Area Transit Authority. Also in 2012, it penned a $2 million contract with the San Francisco Municipal Transportation Agency and possibly a contract with Tampa.

Get Video Surveillance News In Your Inbox
Get Video Surveillance News In Your Inbox

A 2012 Investor letter we obtained claimed that through the first 5 months of 2012 they had "well over $12 million in closed deals already that will hit the books this year."

The BRS Labs document reports unaudited results for 2012 that BRS Labs says are "not to be relied upon." However, they did show substantial increase of revenue over 2011 with similar expenses. However, even the unaudited numbers stated were significantly below the levels mentioned in the previous investor letter.

2013 Strategy Shift to Channel

BRS Labs says its 2013 growth strategy is “primarily focused on marketing and commercialization of AISight 3.0 [its surveillance analytics product].” What’s changed since 2012, according to BRS Labs, is its sales strategy, which moved from direct sales to marketing through resellers. In the documents reviewed by IPVM, the company said it originally charged a set price for the product and additional fees for implementation and support, but the strategy was “no longer sustainable as it was becoming increasingly difficult and expensive” due the number of international customers. The company says going forward it will market its product through resellers on short-term, fixed price agreements. If the strategy is not successful, BRS Labs says it plans to shift its focus to new product offerings.

Expansion to SONAR, RADAR, Biometrics and the Internet

Those new offerings would hopefully expand AISight outside of surveillance.

The company wants to develop AISight where it can be used to learn what is normal/abnormal regarding any kind of incoming electrical signals from radar readings to suspicious Internet activity. "Any signal that can be run through a computer can be applicable," the company says. Some of the stronger claims BRS Labs makes include sonar (detecting abnormalities in sound waves), radar (find abnormal situations based on radar readings), "learning" behavior of a targeted individual based on biometrics and Internet traffic. For the Internet, they note, "This same encoding could be used for searching the Internet for particular patterns based on analytics observations." 

In May 2013, they announced a “preferred” round of funding for development of a new line of products scheduled for release in early 2014 that will “expand outside of video surveillance” to include airspace and cybersecurity.

High G&A Costs, Low R&D Expenditures

The company’s goal to expand its technology seem especially ambitious considering its relatively low expenditures on research and development (~$2 million annually).

                R&D         General and Administrative     Sales and Marketing

2010      $1.8 million             $3.7 million                    $5.1 million

2011      $1.9 million             $6.3 million                    $7.3 million 

With a current round of funding it hopes to raise ~$10 million more to “meet working capital needs through April 30, 2016.”  In April, we reported on BRS Labs' efforts that led to another $25 million from investors, the company’s biggest round of funding yet (That makes a total of around $87 million since 2006).

BRS Labs Potential?

The biggest advantages BRS Labs has is that:

  • They address a great need for deep pocketed customers, as reinforced by the recent Boston bombings (that's not to say that they can or cannot 'stop' such events but clearly users are looking for solutions that might alert them to those incidents).
  • No one, certainly in the US, is marketing a similar solution for video based, behavioral triggered alerts, giving them a fairly unique position in the market.

However, the continued losses, the far weaker revenue compared to public proclamations, especially despite sizeable SGA expenditures, raises questions about market acceptance. The potential to shift / expand into speculative new markets like RADAR, biometrics and the Internet introduces risks of its own. That said, the company has built name recognition and crafted a marketing message that appeals to customers who can easily spent hundreds of millions on BRS products. 

BRS has the cash now to execute for, at least, a few more years to prove its ultimate success.

2 reports cite this report:

BRS Labs Raises $18 Million on May 14, 2015
Let the money flow. After a few years of relative quiet, BRS Labs is back fund raising in a big way, with ~$18 million coming in. We break down...
The BRS Labs IPO on Aug 06, 2014
BRS Labs is IPOing. Maybe. Probably Not. [premium_content] The TV Interview This started with a Fox Business News TV segment with BRS Lab's...
Comments (10) : PRO Members only. Login. or Join.

Related Reports

IFSEC 2018 Final Show Report on Jun 20, 2018
IPVM attended the IFSEC show for the first time this year. The Chinese took over the show, centered on Hikvision, flanked by Dahua, Huawei and a...
Cybersecurity Startup VDOO Disclosing 10 Manufacturer Vulnerabilities Starting With Axis And Foscam on Jun 20, 2018
Cybersecurity startup VDOO has uncovered significant vulnerabilities in Axis cameras along with many others not yet disclosed. In this report, we...
Hikvision Corrects False Cybersecurity Announcement on Jun 18, 2018
Hikvision has corrected a false cybersecurity announcement that claimed a British government-sponsored program endorsed the cybersecurity of...
Security Sales Course Summer 2018 on Jun 14, 2018
Based on member's interest, IPVM is offering a security sales course this summer. Register Now - IPVM Security Sales Course Summer...
IPVM For PR / Marketing People on Jun 13, 2018
This post helps PR and Marketing people understand and productively work with IPVM (as much as possible given our independent, often critical,...
ReconaSense - The AI / Access Control / Analytics / IoT / Video Company Profile on Jun 12, 2018
One company's ISC West booth stood out for displaying a light-up tower of buzzwords. The company, ReconaSense, pledged to be 'making sense of it...
Dahua's Terrible Cybersecurity, Buys Credibility From PSA And SIA on Jun 04, 2018
Dahua has a terrible cybersecurity track record. But American organizations, like the Security Industry Association (SIA) and the PSA Security...
Ambitious Mobile Access Startup: Openpath on May 24, 2018
This team sold their last startup for hundreds of millions of dollars, now they have started Openpath to become a rare access control small...
Buy Arecont: Top Bid $10 Million Cash on May 22, 2018
Last year, Arecont had a deal for a purchase price of $170 million (see Failed Arecont China Acquisition). This year, Arecont has a deal for a...
Stealth / UCIT - Remote Video Monitoring Provider Profile on May 18, 2018
Can 2 remote video monitoring companies, Stealth Monitoring from the US and UCIT from Canada combine to impact the market and compete in a changing...

Most Recent Industry Reports

July 2018 IP Networking Course on Jun 22, 2018
  This is the only networking course designed specifically for video surveillance professionals. Register now. Lots of network training exists...
Installation Hardware for Video Surveillance - Indoor Fasteners on Jun 22, 2018
As part of our Installation for Video Surveillance series, in this note, we cover drywall anchors. A key part of installing security hardware is...
Hikvision ColorVu Integrated Visible Light Cameras Examined on Jun 22, 2018
When it comes to low light, infrared light has become the defacto standard in surveillance. But IR is limited to monochrome images, making colors...
'Secure Channel' OSDP Access Control Examined on Jun 21, 2018
Despite claiming to be better than Wiegand, OSDP's initial releases did not address the lack of encryption between reader and controller, leaving...
Most Wanted Improvements In Manufacturer Technical Support (Statistics) on Jun 21, 2018
5 key areas of improvement and 1 clear wanted support feature were voiced by 140+ integrator responses to: What improvement in manufacturer...
GDPR / ICO Complaint Filed Against IFSEC Show Facial Recognition on Jun 20, 2018
IPVM has filed a complaint against IFSEC’s parent company UBM based on our concern that the conference violates core GDPR principles on...
IFSEC 2018 Final Show Report on Jun 20, 2018
IPVM attended the IFSEC show for the first time this year. The Chinese took over the show, centered on Hikvision, flanked by Dahua, Huawei and a...
Mobotix Releases 'Move' Into 21st Century on Jun 20, 2018
For years, Mobotix stood resolutely against, well, every other manufacturer, selling it as a virtue: MOBOTIX equipment is designed with no...
Cybersecurity Startup VDOO Disclosing 10 Manufacturer Vulnerabilities Starting With Axis And Foscam on Jun 20, 2018
Cybersecurity startup VDOO has uncovered significant vulnerabilities in Axis cameras along with many others not yet disclosed. In this report, we...
Axis Guardian - Cloud VMS And Alarm Monitoring - Released on Jun 19, 2018
Axis has struggled to deliver a cloud-based managed service video platform. Video service providers have utilized AVHS for over a decade, and have...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact