Verkada Lead Investor’s Fundamental Errors

By: John Honovich, Published on Feb 05, 2020

The man behind Verkada’s stunning $1.6 billion valuation, Aydin Senkut, has been talking up many fundamental errors he made in the investment.

From fundamentally misunderstanding Honeywell and Hikvision to even Verkada itself, he has made one daring bet.

But that does not mean he will wind up losing money on this risky deal. Inside this note, we examine his errors and, despite that, why his money may help himself and Verkada.

*** *** ****** *******’* stunning $*.* ******* *********,***** ******, *** **** ******* up **** *********** ****** he **** ** *** investment.

**** ************* **************** ********* and ********* ** **** Verkada ******, ** *** made *** ****** ***.

*** **** **** *** mean ** **** **** up ****** ***** ** this ***** ****. ****** this ****, ** ******* his ****** ***, ******* that, *** *** ***** may **** ******* *** Verkada.

[***************]

Please **** ** *****

****** ******** **** ******* did *** **** *** money ***** ***, ** he******** ** *** ********:

* **** ** **** one ***** *****: ******* was *** ** **** of ***** ***weren’t ******* *****. They had plenty of runway from their previous funding.

*** ***** **** *** or ******** ***** ******** ahead ** **** **** would **** **** ******* a *** *****.We ****’* **** ** **** and they didn’t want to go through a formal process. [emphasis added]

** ********* **** ** giving **** **** **** high *********. ******* *** not ******. ** **** can *** *** ***** sooner ** *** **** valuation **** ******** *****, take ** ***.

*** **** ** * thing ** ******* ****** 2020, *.*., *** *** Information's ****** ******:******* *******’* *** ******: Outsized ****** *** *********** Offers.

Marketing *** *** ** *******

** *** **** *********, Senkut ******** ****:

*** **** ****** ***** anything ** *********. *** this ** ********* ******* the *******-****** *** ** really, ****** *****.

** ***** ** *** thing ******* ** ************ the **** ** ** physical ********, ** ** spending ***** ** *********. Not **** ** **** give **** **** ** thousands ** **** ******** at * **** ** a ******* *******, *** they **** *** ************** on ****:

*** **** **** ***** millions ** ****** *********. For *******, *** ** their ********* ******** ********* spending * *******-******* ******* per ******* **** ** Google:

******, *********, ******* *** 50+************** ******* ** ********:

***, ** ******,****** **** $*** *** referrals*** ****** ****** *** Verkada:

*** ******** ** ********* plus ******* *** *** returning **** ***** *******:

******* ** ******* ***** they *** ******* **** are ******** ** ************* amount ** **** ***** and *********.

Hikvision *** *********

**** *** ***** ***** at * *******, *** want ** ******* **. Senkut *** **** **********, *********:

*** ***** ****** ************* is *** *** **** market **. ********* ** valued ** $*** *******-****. There’s * ******* ******* that’s **** $** *******. The *********** ** ** the ********* ****** *** all ********* ** *** world? ****** **** **** market ******’* ** ******.

********* ** ********* ****************** '********' *******. **** a ******** ** ********* does *********, **** **** of *********'* ******** ** aerospace, *** *** *** industry, *** ***** *******. People *** *** *************** what *** ****** **, they ****** ********** **** Honeywell ** * ************ that **** **** ******, most ** ***** **** nothing ** ** **** Verkada's **** ******* ****** 'building' ********.

*** *** ******* ******* he ** ********* ** is *********, ***** ** currently ****** ** ~$** billion ***. ********* *** this ******* ********* *** 3 *******:

  • *** *** ********** ******* it
  • *** *** ********** ****** or ******* ******* ***********
  • *** ***** ****** ********** are ********* ********, ***** driven ** *** **********.

*********'* ********* ** ** fundamentally ********* **** ******* that ***** ** ** sense ** ******* **********.

***, *** ***** *** are ********* ***** ********* inflated *** ***** ****** valuations,**** *******, * ******* in ******, ***** ******* *******, founder *** **** ******* and ** ***** ****. They ***** **** * half-billion-dollar **** *********. ** the ****, **** ***** be ***** ** **** 1/10th **** *********.

Investor ******

********* ** *******, ******'* vision ** '*** *** buildings ** *** *****':

**** *** ** ******* is ****'* **** ** only ***** *********. **'* just *** ****'** ******* started. ****'** ***** ** start ****** ** **** and **** *** ***** to ****** *** ********* system *** *** *** buildings ** *** *****

Still *** ***

***** ** ** ****** that ******* **** "****** the ********* ****** *** all *** ********* ** the *****" ** **** half, ** * *******, or * ***** ** the *****. *** ******* and ***** ********* ** not **** ****.

********* *** ***** ****** notwithstanding, *******'* **** ******** still *** **** * good ******.

** ******* ***** ***, e.g., **** $* *******, it ***** ** ************* for (***-*****) ***** ************ / ******** ********. *******, Verkada ** ******** ** unprecedented ******-**, ****-********** *******. Virtually ***** ************ ****** control *** ***** ************ business ** ***** ********* on ****** ***** (**** a ***** ** *****, sell * ***** ** more ***** **** ****, etc.), ******* ** *********.

********* ** *******'* *********, to *** ******** ** Verkada's **** ********, ******** the **** *** ** that ***** ** ** get *** ***** *** marketing ****** ** *** as ******** ** **** as ********.

**********, *** ****** **** fully ********** *** ********* of ******* ****** **** this ***** ***, ** the ********, *** ********** of **** ***********, *** power ** *******'* ***** machine *** ***** ******* Valley's ***** *** ***** to ********, **** *** them * *** ** customers.

*** **** ********* **** can *** ***, *** more **** *** *** them ** *** ****** control ** **** ** whatever **** ******* **** next, *** **** ****** these ********* **** ** with ******* ** **** and ****** ** *** cost *** ********** ** moving *** ** ***-**-*** Verkada ****** **** ** practically ***********.

*******'* *** *** **** knows **** ******* **** **** ****:

******* ** ************* ******. That’s *** ****** ** the ****** ** *** system. **** ******** **************, there’s *significant ******* ********** from the customer: she has invested both in the hardware and the labor to physically install a system throughout her buildings. [emphasis added]

******, ******* **** *** need ** ******** ******** of ******* ** ** worth ******** ** *******. The *********** ********** **** flow **** *** ******-** Verkada ***** *** *** potential ** ** *** most ********** ***** / access ******* ****.

*** ** **** ***** helps ******* ** ***** up *** ******* ******, Verkada's **** ******** *** very **** **** **** times *** ***** ****.

Comments (34)

*** ******* *** ** Mr. ******'* ***** ******* please? * **** **** swampland ** ******* **** he ***** **** ** invest **. ** ***** not ** ***** **** now, *** **** ** drain ** *** *** up * ******** **** it **** ** ***** millions. ******* ** *** is *** ***** *****, and ** ***** **** this **** ** ********** might ** ** *** alley.

**** *** **** *** product?

*'* **** ******** **** the *******, **'* ***********. I **** ***'* ***** they **** * **** term ******** ***** ** this ********.

**** *** **** *** product?

*** ******* *********?

* ***’* **** ** again, *** **** ******* I *** ******** **** someone ******** ********** **** low *** ************* *** installed * *** ****** Verkada ****.

***. ** ** ***** to ** *** *********** people *** ******** ***** on ****** **** ***'* come ***** ** *************. I ***** **** ** fundamentally *** ******** ** venture *********** ****** *****?

**** ***'* **** ***** to *************

** ********, ******* ********* is ***** ****** **** on *** ****** ***** you *** ***** ****** be ******* **** **** happen. **** *********** **** out ****** *** *** few **** *** **** runs **** **. **** Verkada ** * '***** slam'? ** *****. **'* bought ******* * ***** ticket *** *** **** of ** **** ***.

*** *******, *** ********* comparison ** **** ***********. On *** ***** ****, he **** ** ** TechCrunch, ***** *** **** interest ** ***** *** diligence ** ****** ******* questions. '******** **** *** *****'. ******** **** *********. Maybe ******* **** *********. Or ***** ***.

******* **** *********

*'* **** ** *** the ********* ******** *** that ***

**** **** *********** ****.

*** **** ******* ****** have **** * ***** booth ** *** *****.. you *** ****** **** it...lol

*** ***** ***** ******** is ***********.

* ***** **** *** right ***** ****. *** wait * *** ***** a **** ** ***** hundreds ** ********* ** dollars ** **** **** to ****** ** *****? Verkada ** *********** ******* a ***-**** ***** **** online ** *** ********** heavy ****** ***** *********** campaigns.

*** **** ***** ** you **** ** **** 2 ***** **** ******* out ****** **** *****?

:)

* ****** *** ***** lead ********** ** *****, throwing **** ** ***** into ********* *** ** very ********* **** ***** are **** * *** qualified ***** ****** **** to *****. * **** wonder **** ************ **** have **** ********** *** integrators...

**** ***** *** **** a *** ********* ***** handed **** ** *****

* ***** *****'* ***** reason ** ******* **** have * *** ** leads. **** ***********, ******* can ****** ********* ******* spending *** **** *** lead **** ************ *********. Let's *** **** *** a **** - ****'* a ***-**** ****** ****, with ***** *** *** certain *********** ** ******* some **** ******* ** the ******. **** ******* that's * ****** **** + * **** **** probability ** ** ******* in ****** ******** *** years ** **** **** expansion ***** ** **** cameras *** **** ********* licenses.

* **** ****** **** relationship **** **** **** installers *** ***********...

**** **** ** ****** to *******? ** *******'* CEO**** ****:

***** ****** *** *** relationship **** *** *********

*****'* *** *********** **** love ******* *** **** does *** ******. ******* is ************** ********* ***** deals ********** *** ***** are ********* ********* *** there **** *** ***** to ** ****** *** install / ***** ******* work.

**** ** **** ****!

* **** ****, ** wife ***** ****, ** brother ** *** ***** his........ **** *** *** too ************** ** *** they ***** ** ***********.

** ***** ** *** thing ******* ** ************ the **** ** ** physical ********, ** ** spending ***** ** *********.

"******** *****" ** "******** money***********" ** *********?

******* ******** - *** implying ** ** ** isn't *********.

***********" ** *********?

***’* *** **** ***** twice ** **** ** acquire * ******** ** the **** ******* ******* in *** ********. ** be *****, * ***’* know *** ** * thought **********.

**** ****** *** ****** it ******* **** ****, unlike ***** *********** ***********, that **** *** *********** locking ** * **** long **** ****** ** profits. *** *** ********* at ******* *** ***** up ** **** **********.

***/***, * ***** ***** customer *********** ********* *** sound ***** ** *** long **** ******* ********** expected, **** ** **** are ****** **** ******** a ******* * **** -**** * ******* ** 2020, ****** * ******* Salesperson

* ** ********* ** Verkada's *** ******** ** like **** ** ***** companies - **** **** the ******** *** **** on *** ***. ***** Verkada ****** ***** **** their *******, **** **** you ** **** *** promise ** *** *** exciting ******** *** *********** hardware.

***** *** ************ ****** Verkada’s ***** *** ****** recurring ******* ******* **** do *** **** ** provide ********** *** *** video ** ****** **-****.

****, *** ***** ** virtually ******* ** ** much ***** **** *** residential ***** ********, ********** if **** *** ********** to *** ***** *** access.

**** ** * ***** article ** **** ******* to ** * ******* situation ******** **** *******..*** saying **** **** *** the ********* ****** **** WeWork *** ** **** point *** **** ****** profitable, *** **** ****** profitable *** ****** **********.

*** ***** *** *** Enabled **** ******* *** the ****** ******* - WSJ

**** **** ***** *** some ** *** ****** most ********* ****** ***** were ***** **** * risky ********** *****...

**** ****** *** ******* are ********* ********* ***, from **** ******* ************* I **** ** ******'* business *****, *******'* ***** is ******.

*** ********** ** ******** markets **** ***** ** hyper-scale ******. ****** ** an ******* ** ** failing, ****** ***** *** many ****** ***** ** works.

* ***** ******* **** because ** ***** ** grab **** ****** ****** else ** ***** *****, knowing **** **** *** land ** *****, ** will ** **** *** it ** ** ****.

***, ****** ***** ******* Verkada ***** ***** *** cameras, ** ***** ******* OEMed?

******, **** ******* ***** own ******** / ******** and *** ******** ************ by *******, ******* ********* ******* *****.

***, **** *** *******'* most ****** ****** *******. They ****** *** *** importing **** **** ******* which ****** ********* ** how **** **** *** actually *******:

***** *** **** * fair ****** ** ********** here ***** *** ************* of *******'* *********.

************,* *********** ***-**** ** this ****** *** ********* evaluating *******("** ******* ******* ** for *** *******, *** all-in ** **** ** 272 ******* ** *** end ** **** ****"). *** ***-**** ******* not ** ** **** Verkada *** **'* ***** an ********** ***** ** how ******* **** *** a **** **** **** end-user:

* *** *** ** the ******** **** * Facebook **. * *** I ******* ***** ********* cameras *** **** **** a *****

****'* * **** ******* of ***** ****** ** action: ****** ***** ** -> **** ******* -> inside ***** ****** -> free ***** *******. ******* did *** *** **** one *** * ** sure **** *** **** others ***** * ****** very *** ******** ************* use.

** ***** ** ********* they *** ***** * great ***, ******** ***** digital ********* ****** *** paid ****** ****.

********** *** * ******* talking ***** *** ********** where*** ***** ***** ** the ********(**** ***********):

***** ******** *** ** be **** ******* ** mil ** * *.* they ****** ** **** percent, *** ******** ****** up *%. *** **** 5% ** * *******? Like *** ****'* **** put **** *******? *** why ** ** ** slim **** *** ***** just **** ** **** when * **** ****?
****, * ****, **'* it's **** *****, **'* something ** ***'* *** that *****. * ****, so *** ******** **, is **** *** ** the ***** ************, ** might ** ********, **** speculating **** *** ***** anything. *** **** *** option ** ***** **** have ******* ** ******* available **** *** ******* can **** ** *** same ***** ** ***** to *** ******, *****?

*** **** ***** ***** putting ** **** ******* is - **** ***** Verkada ** **** **** money? **** ****** ** only ** *** *** only ***** ** ****. But ** **** ***** an *********** *****. **** if ******* ****** ******* $100 ** $*** ******* in *** **** * years? **** **** **** do **** **?

*** ******** ** **** similar *********** *** ******** automation.

*** *****:

*******'* ***** ** ********* this:

****** *******, **** * sh*t **** ** ***** reps **** ****** ****-*** end-user *****.

**** ***'* *** *** firms ** ************ *** their **** ***** *** deals ** *** *********** they **** ** **** with (** ***** ** switching ***** ********)

***** ***** **** *** by *** *** *****, poorly ******** ** *********** and *** ******** ****** in *******. **** **** come **** ****, ****** sales, *** - **** from *** *********** ******** market (****** ****, ****** supply *****, ***). *** end ******? **** ** as **** *** ** fast ** ******** *** sell.

***** ***** **** *** by *** *** *****, poorly ******** ** *********** and *** ******** ****** in *******.

****'* **** *** **** are **** ***** ********* and ********. * *** of ****** *** ** on ****, ********** ** the ****** **** *** poorly ******** ** *** details ** *** ******* / ********.

*** * ******* ******** about *** ** *********** or ******** *** * assure ** **** *********** dismiss **, ** * manner, **** ** ********* end **** **** ******. Leaving ****** *** ******** aside, ** ** ** effective *** ** ***** deals.

***** ***** **** *** by *** *** *****, poorly ******** ** *********** and *** ******** ****** in *******. **** **** come **** ****, ****** sales, ***

***... ***! **** * minute! **** ** ********'* sales **** ***** ** the **** *** ***** come **** *****, *****, etc. *******, *** ****** path ** ***** ************ sales ** *** ******* printer ********.

*******. *** *'** **** told **** ******** *** a ***** **** ******* employees ****** ** ****. If **, ***** ****'* why ****'** ******* **** that ***** *** ****** representatives - ** ******* hiring **** **** ***** is ***** **** **** they'll **** *** "******" that **** ***** *** 60-80 **** ***** * day *** ** ****** before ******* ********** *** as ****.

* ***'* **** **** kind ** ******** ******** puts *** ****** *******, and * **** **** the ******** ** *** revolving **** ** ***** people ******* *****. *******, I **** ***** ***** anyone *** **** ** Avigilon ***** *** *****'* know **** **'* ******* about. **** ** **********, and **** **** *'** heard, *** ******** **** are *** ****** **** trained ** *** **** their *******, *** **** also *** ***** ** what's ***** ** ** the ******.

*** ******** **** *** all ****** **** ******* on *** **** ***** product, *** **** **** are ***** ** ****'* going ** ** *** market.

****: **** ** ******** from ** ******** **********. At *****, * ******** if **** *** ** Avigilon ******** ******* ********** on *** **** *** no.

Login to read this IPVM report.
Why do I need to log in?
IPVM conducts unique testing and research funded by member's payments enabling us to offer the most independent, accurate and in-depth information.

Related Reports

PSIM CNL Acquired By Everbridge on Mar 09, 2020
The end has finally come for CNL. Despite for years saying they would revolutionize the industry, they have been taken over in a footnote of a...
Verkada Raises $80 Million, Triples Valuation To $1.6 Billion on Jan 30, 2020
Verkada's rocketing valuation continues. 9 months ago, they got a half-billion valuation and now they have announced more than triple that, at $1.6...
Verkada Paying $100 For Referrals Just To Demo on Jan 22, 2020
Some companies pay for referrals when the referral becomes a customer. Verkada is taking it to the next level - paying $100 referrals fees simply...
Verkada Salesman Falsely Alleges Competitor Bankruptcy on Jan 02, 2020
A Verkada salesman falsely told a large end-user that the user's VMS provider faced bankruptcy. Verkada management acknowledged the error to...
How To Quickly Research An Unknown Company on Jul 23, 2019
There are hundreds of companies in the physical security markets, ranging from a flood of new startups to small companies that may or may not be...
Avigilon President Henderson Is Out on Jul 09, 2019
Avigilon's President and COO James Henderson is out, abruptly, after a remarkable ascension over the past 8 years, Motorola VP Jack Molloy has...
2019 Mid-Year Video Surveillance Guide on Jul 01, 2019
IPVM's new 400+ page Mid-Year Industry Guide brings all of these issues and events together in a single resource to read and review. It can be...
The Fastest Growing Video Surveillance Sales Organization Ever - Verkada on Apr 17, 2019
Verkada has the fastest growing video surveillance sales organization ever. In less than 2 years, they already have more salespeople in the US...
Securadyne CEO: IPVM 'Entertaining For An Ignorant Few' on Apr 16, 2019
Securadyne's CEO Carey Boethel is unhappy with IPVM's report - Failed Integrator Rollup, Securadyne Sells to Guard Giant Allied. Indeed, he...
Failed Integrator Rollup, Securadyne Sells to Guard Giant Allied on Apr 10, 2019
One of the most ambitious integrator rollups of the decade has reached its conclusion—selling to a mega guard company. Allied Universal has...

Most Recent Industry Reports

Viakoo Presents Cyber Hygiene for Cameras on May 28, 2020
Viakoo presented its 'Cyber Hygiene' and 'Service Assurance' products at the April 2020 IPVM New Products show. Inside this report: A...
Seek Scan Thermal Temperature Screening System ReTested on May 28, 2020
Now that IPVM has tested Dahua, Hikvision, and Sunell, we are returning to Seek, the first blackbody system we tested and retested it with our...
Directory of 106 "Fever" Camera Suppliers on May 28, 2020
This directory provides a list of "Fever" scanning thermal camera providers to help you see and research what options are available. There are...
Fever Cameras Are Medical Devices, Per The FDA, Dahua, Feevr, Hikvision, InVid Contrary Claims Are False on May 28, 2020
Fever cameras are medical devices, despite what euphemisms various sellers use. The US FDA clearly categorizes them as medical devices and...
Wyze Raises $10 Million And Seeks Services Expansion on May 27, 2020
Wyze has raised $10 million, the company's first disclosed raise since the $20 million announced at the beginning of 2019. Inside this note,...
Startup Videoloft Presents Cloud Storage on May 27, 2020
Videoloft presented offsite cloud storage at the May 2020 IPVM Startups show. A 30-minute video from Videoloft including IPVM...
Directory of 300+ Fever Camera News Reports Globally on May 27, 2020
This global directory tracks 300+ articles about thermal cameras used to detect fevers in response to the coronavirus pandemic. Articles are...
Integrators Rising Against Coronavirus on May 27, 2020
IPVM integrator statistics make it clear - Coronavirus's impact on business is lessening and many are anticipating even better news in weeks...
Netposa Stock Surges 46% After US Human Rights Abuse Sanctions on May 27, 2020
Last Friday, the US government announced it would sanction PRC video management provider NetPosa for being "complicit in human rights violations...
LILIN Presents NDAA-Compliant P2 Cameras on May 26, 2020
Merit LILIN presented its NDAA-compliant P2 camera series at the April 2020 IPVM New Products show. Inside this report: A 30-minute video...