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 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

Sighthound Transforms Into Enterprise AI Provider on Jun 14, 2019
Sighthound is now rapidly expanding its R&D team, building an enterprise AI service. This may come as a surprise given their origins 6 years...
ADT Eliminating Acquired Brands, Unifying Under 'Commercial' Brand on Jun 14, 2019
ADT is eliminating the brands of the many integrators it has acquired over the past few years, including Red Hawk, Aronson Security Group (ASG),...
Embattled $400 Million China Funded Philippines Surveillance System Proceeds on Jun 13, 2019
An embattled 12,000 camera surveillance system project that will cost ~$400 million will proceed.  The project contract was awarded, had its...
False Verkada 'Unrivaled' Low Light Performance Claim Removed on Jun 12, 2019
Verkada falsely claimed that it delivered 'UNRIVALED LOW LIGHT PERFORMANCE' until IPVM questioned. In fact, Verkada's low light performance is...
Carnegie Mellon AI Startup Zensors Profile on Jun 11, 2019
Zensors is a startup formed by Carnegie Mellon graduates from a Carnegie Mellon research project, offering customized models per camera that they...
Nortek and SDS Fight Over Failed Settlement on Jun 05, 2019
Distributor SDS said they reached a deal with Nortek but Nortek says no settlement was reached and the suit is still on. In this post, based on...
Startup Rhombus Systems Says Twice the Features, Half the Price of Verkada on Jun 04, 2019
Closed cloud systems may be the fastest growing segment of video surveillance with Meraki and Verkada. Now another California company is joining...
China / US Trade War Impact Splits Industry on Jun 04, 2019
As the trade war continues to heat up, 170+ integrators told us "What impact will the US / PRC China conflict have on the industry?" Respondents...
Panasonic Sells Off / Spins Out Security Business on Jun 02, 2019
Panasonic has sold off its security systems business to a private equity firm, after suffering years of challenges. The new company, which will...
Alibaba Makes Major Investment Into Uniview on May 30, 2019
China's e-commerce and cloud services giant Alibaba has bought 15% of the shares of Uniview's parent company, TransInfo, in a deal worth ~$500...

Most Recent Industry Reports

Sighthound Transforms Into Enterprise AI Provider on Jun 14, 2019
Sighthound is now rapidly expanding its R&D team, building an enterprise AI service. This may come as a surprise given their origins 6 years...
ADT Eliminating Acquired Brands, Unifying Under 'Commercial' Brand on Jun 14, 2019
ADT is eliminating the brands of the many integrators it has acquired over the past few years, including Red Hawk, Aronson Security Group (ASG),...
NSA Director Keynoting Dahua and Hikvision Sponsored Cybersecurity Conference on Jun 13, 2019
The technical director for the NSA’s Cybersecurity Threat Operations Center will be keynoting a physical security cybersecurity conference that is...
Farpointe Data Conekt Mobile Access Reader Tested on Jun 13, 2019
California based Farpointe Data has been a significant OEM supplier of conventional access readers for years to companies including DMP, RS2, DSX,...
Embattled $400 Million China Funded Philippines Surveillance System Proceeds on Jun 13, 2019
An embattled 12,000 camera surveillance system project that will cost ~$400 million will proceed.  The project contract was awarded, had its...
False Verkada 'Unrivaled' Low Light Performance Claim Removed on Jun 12, 2019
Verkada falsely claimed that it delivered 'UNRIVALED LOW LIGHT PERFORMANCE' until IPVM questioned. In fact, Verkada's low light performance is...
Manufacturer Favorability Guide 2019 on Jun 12, 2019
The 259 page PDF guide may be downloaded inside by all IPVM members. It includes our manufacturer favorability rankings and individual...
Camera Course Summer 2019 - Register Now on Jun 12, 2019
Register for the Summer 2019 Camera Course.  This is the only independent surveillance camera course, based on in-depth product and technology...
Favorite Wireless Manufacturers 2019 on Jun 12, 2019
Many wireless options exist for video surveillance but how are integrator's overall favorites? 170 integrators answered the question: What is...
Carnegie Mellon AI Startup Zensors Profile on Jun 11, 2019
Zensors is a startup formed by Carnegie Mellon graduates from a Carnegie Mellon research project, offering customized models per camera that they...

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