BRS Labs Financials and Future Examined 2013

By: 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 [link no longer available] 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 [link no longer available] 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 Notified of Video Surveillance Breaking News
Get Notified of Video Surveillance Breaking News

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 [link no longer available] 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) : Members only. Login. or Join.

Related Reports

Cybersecurity Insurance For Security Integrators on Nov 29, 2018
Most security industry professionals carry insurance to cover themselves in the event of a general loss. However, most are not carrying cyber...
UTC, Owner of Lenel, Acquires S2 on Sep 20, 2018
UTC now owns two of the biggest access control providers, one of integrator's most hated access control platforms, Lenel, and one of their...
Sunell Panda Cam Body Temperature Measurement Camera Tested on May 14, 2020
Sunell is far less well known than its gargantuan domestic competitors Dahua and Hikvision but the company's 'Panda Cam' is going head to head...
Hikvision DeepInMind Tested Terribly on Feb 15, 2018
While Hikvision is heavily marketing deep learning and 'AI' as their next big thing, new IPVM test results of their DeepInMind NVR shows their deep...
Integrator Profitability Bonuses - Statistics on Mar 13, 2019
While winning projects typically gets the most attention, how profitable those jobs turn out to be is key to the long-term success of integrators....
Fever Camera Sales From Integrators Surveyed on Jun 01, 2020
Fever cameras are the hottest trend in video surveillance currently but how much are integrators selling them? 220 integrators answered the...
FDA "Does Not Intend to Object" To Unapproved Fever Detection Cameras If No 'Undue Risk' on Apr 17, 2020
The US FDA has declared it will not go after the many companies marketing unapproved fever detection cameras during the coronavirus public health...
LifeSafety Power NetLink Vulnerabilities And Problematic Response on May 20, 2019
'Power supplies' are not devices that many think about when considering vulnerabilities but as more and more devices go 'online', the risks for...
Critiquing Carnegie's AI Surveillance Paper on Sep 25, 2019
The Carnegie Endowment has issued an ambitious paper on the Global Expansion of AI Surveillance. While its aim is applaudable, the paper has...
What Is the Importance of Revenue vs Profitability for Integrators? Statistics on Mar 01, 2019
A company can be highly profitable but if it is small, they will still not make much money. By contrast, a company can generate lots revenue, but...

Most Recent Industry Reports

Startup Duranc Presents AI VSaaS on Jul 06, 2020
Duranc presented its system at the May 2020 IPVM Startups show. A 30-minute video from Duranc including IPVM Q&A Background on the...
Low Voltage Nation Wants to "Help You Carve Out A Fulfilling Career" Interviewed on Jul 06, 2020
It is difficult to make your way in this industry as there is little formal schooling. However, one person, Blake Urmos, the Founder of Low Voltage...
The Next Hot Fever Detection Trend - $100 Wall-Mounted Units on Jul 06, 2020
The first wave of the booming fever detecting market was $10,000+ cameras, now interest for ~$2,000 tablets is high and the next big thing may be...
Cisco Meraki Unlocks IP Cameras With RTSP Tested on Jul 06, 2020
Meraki opened up its cameras to 3rd party NVRs/VMSes by offering RTSP streaming because of "the need to solve a business problem". We tested...
Verkada: "IPVM Should Never Be Your Source of News" on Jul 02, 2020
Verkada was unhappy with IPVM's recent coverage declaring that reading IPVM is 'not a good look' and that 'IPVM should never be your source of...
Vintra Presents FulcrumAI Face Recognition on Jul 02, 2020
Vintra presented its FulcrumAI face recognition and mask detection offering at the May 2020 IPVM Startups show. Inside this report: A...
Uniview Wrist Temperature Reader Tested on Jul 02, 2020
Uniview is promoting measuring wrist temperatures whereas most others are just offering forehead or inner canthus measurements. But how well does...
Dahua USA Admits Thermal Solutions "Qualify As Medical Devices" on Jul 02, 2020
Dahua USA has issued a press release admitting a controversial point in the industry but an obvious one to the US FDA, that the thermal temperature...
Access Control Online Show - July 2020 - With 40+ Manufacturers - Register Now on Jul 01, 2020
IPVM is excited to announce our July 2020 Access Control Show. With 40+ companies presenting across 4 days, this is a unique opportunity to hear...