Envysion's Funding and Financial Progress Examined

In this note, we examine managed video provider Envysion's recent fund raising and financial progress, including details from a conversation with Envysion. Of particular interest is Envysion's atypical fund raising pace and revenue/business model.

Since starting in 2006, Envysion has raised approximately $17 Million USD. In the last investment announced on their website, Envysion disclosed $3 Million in new funding in 2008 [link no longer available]. Since then, SEC Form D filings document $2.3 Million raised in October 2009 and an additional $1 Million in November 2010.

Commenting on the pace of funding, Envysion noted, "We have always been a very conservative fund raiser, bringing in only what we think we need or can make good use of in the near future; Given our existing investors, who management has worked with across multiple companies, are all fully active and have participated 100% pro rata in every round we have a strong position in that we can self-fund our growth without having to seek external capital, adding cash to fund growth opportunities as we identify them."

Envysion reports that they are growing strongly, "doubling key metrics year over year and making very good headway in new verticals." Envysion noted examples including medium sized retailers, service providers (such as hair salons) and convenience stores. Additionally, Envysion notes that they are close to cash flow positive and are using the additional funding to accelerate sales expansion.

If Envysion is close to cash flow positive, this would be both impressive and notable. Envysion sells managed DVRs at a relatively low cost (usually under $2,000) plus ongoing monthly managed service charges. As such, Envysion's revenues are much less front weighted than traditional DVR/VMS offerings, making it more challenging to quickly reach cash flow positive position. Envysion's progress may be a milestone for the emerging cloud surveillance market. That noted, their approach (of providing managed video rather than hosted) is different than the overwhelming majority of VSaaS providers.