Summary
If you’ve ever worked at a large corporate building you have probably seen the security team at work keeping an eye on the day-to-day visitors of the building.
When you start to think about the cost of security and frankly the importance of it, you would think that companies would do everything in their power to ensure that they get the right level of protection and security needed in the event anything should happen.
But frankly, this market is antiquated and out-of-date. While most of us store our own personal photos on the cloud, most corporations still store all of their security camera data in on premise hardware that is easy to hack and is often out of date. Thus, the first line of defense loses a great deal of its actual value.
Rick Bentley, an experienced Silicon Valley entrepreneur with years of entrepreneurial tech experience under his belt is out to solve this problem.
He and his team at Cloudastructure are building an impressive tech stack to reinvent the way corporations secure their assets by moving security footage to the cloud while providing value add tools like AI to better enable face recognition and more powerful security surveillance.
Check out our in-depth discussion below…
Funding Round Details
- Company: Cloudastructure
- Security Type: SAFE
- Valuation: $7,000,000
- Min Investment: $100
- Platform: Republic
- Deadline: Jul 15, 2019
Rick, you have deep experience in the tech center of the world. How did you stumble upon this problem and why are you the right person to solve it?
In the early 2000’s I was the founder/CEO of a venture backed startup (Televoke). We had offices South of Market in SF, with an alarm, access control system and guy at the front desk. Around lunchtime someone dressed like the rest of us, walked in, picked a notebook up off a desk, and walked out without anyone really noticing.
When we went to see the video from the cameras on the building we found out that the whole system had been down for weeks and nobody knew it was down.
The system was unmonitored, wasn’t online, was all very low tech. I asked the landlord why he bought such a crappy system and he said he had bought the best one on the market. I said “someday I’m going to fix that industry”.
For those that don’t know what problem are you solving with Cloudastructure?
Legacy systems are completely on premises. Nothing is backed up to the cloud, they’re not monitored (they might send you an e-mail if their disk gets full but they can’t e-mail you if they get unplugged) and they’re dumb — no Computer Vision, no AI, no Machine Learning.
Why do large corporations in this space not develop cloud based secure storage solutions like Cloudastructure?
Our biggest competitors have only relatively recently gone from shipping software on CD to the download-our-Windows-app model. Hosting something in the cloud is far outside their area of understanding.
How much will large security conglomerates push back on this type of solution and how will you defend against that in the selling process?
We see the push back all the time, everything from self-promoting white-papers on “best practices for enterprise video surveillance”, or whatever, that basically say you should buy their product.
The good news for us is that there is a new purchaser in town: the IT department. The facilities department is giving up, or being forced to give up, and hand over anything on the network to IT. IT understands the Cloud.
Outside of these challenges, what is the go-to-market plan?
We’re on the market now and making low 5-figures per month. We’re taking time, however, to add the higher level Computer Vision / AI and ML features before we resume our market push.
We like selling direct to IT departments, some of whom have only recently been given control of the camera and door systems, but we believe we will need the right channel partners to really scale.
How is the solution monetized and what does the typical price point look like?
It’s an Enterprise SaaS model. We charge per year per camera and door.
Can you talk about the AI tech you plan to build out and how you will monetize these as upsells?
We already have Computer Vision in production. Tagger™ tags all the objects in the video and then we let you search by object (e.g. instead of watching branches blow or vehicles drive by you can just search for “person” and see videos with people in them).
Face recognition is working in development and tailgating/piggyback detection is up next. As we start to perform the work of the person at the front desk we believe we can start to charge more for these higher level AI features.
Do you have a sense of how large the problem is that you are solving for with your AI tech (i.e., how often are companies searching through tapings to find someone stealing or whatever it may be)?
Think of it this way, every large company has someone in the front lobby of every building. They are doing two basic things:
1) Making sure your face matches your badge, and
2) Making sure when you badge in that someone isn’t tailgating / piggybacking in behind you.
They need two of them at every door (so one can go to the bathroom), three 8hr shifts per day, 7 days per week, just to monitor one door. We can monitor every door (side door, back door, IT closet, document room…) and we can do it 24/7.
How many business have doors? How many relevant doors does each one have? It’s a massive opportunity.
What does your current sales pipeline look like?
We’ve been heads down on the Computer Vision / AI / ML tech lately and not pushing sales, but we still have dozens of customers. We’re going to go after Enterprises with multiple locations and Universities next, as that’s where some of our best traction to date is.
Do you see this as an acquisition or standalone business?
I always build to be standalone. That said, the security industry is full of huge public companies whose R&D department is their M&A department. They don’t build stuff, they buy stuff. We expect to get some juicy offers along the way.
Where do you see the business in five years and who else do you need to outcompete between now and then to be a market leader?
IPO or acquisition in 5 years is the plan. Outcompeting the incumbents on technology is easy for us, its harder to beat them on market share as they were here first. We know we have the right team and technology lined up to do just that, now it’s a matter of execution.
Rick and his team are already off to the races finding product market fit and building a tech stack that outcompetes any of the major players in the security industry today.
With many billion dollar behemoths in this market, Cloudastructure is setting itself up well to find a home with one of these organizations down the road, while reenvisioning the way corporate security is managed.
Be sure to stay tuned for continued coverage of the business and if interested invest HERE.
