Soundthinking, Inc. · NASDAQ:SSTI
Soundthinking — Shotspotter — Investor Day (December 2019)
133 slides from Soundthinking's investor day presentation, Dec 17, 2019
Slide 1: COMPANY Exhibit 99.1
COMPANY CONFIDENTIAL Exhibit 99.1
Slide 2: Analyst & Investor Day December 17, 2019
Analyst & Investor Day December 17, 2019
Slide 3: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements This presentation contains "forward-looking statements" within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including but not limited to statements regarding ShotSpotter, Inc. (the “company”)
Slide 4: Agenda
Introduction & Strategic Vision – Ralph Clark Market Opportunity & Product Roadmap – Sam Klepper Technology – Paul Ames & Rob Calhoun Project Management & Service Implementation – Joe Hawkins Break Customer Support & Professional Services – Nasim Golzadeh Customer Success – Paul Reeves Latin America
Slide 5: Introduction and Strategic Vision
Introduction and Strategic Vision Ralph Clark, President & CEO
Slide 6: Purpose
Purpose Customers Company Investors Purpose To earn the trust of law enforcement to help them provide equal protection to all and strengthen the police-community relationship, ultimately reducing gun violence.
Slide 7: The Gun Violence Problem
The Gun Violence Problem Annual Averages (2013-2017) Sources: “Gun Violence in America” Everytown.org; Urban Institute, Brookings Institute 13K 76K Gun Homicides Gun Injuries Local economy and jobs suffer ~80% Gunshot incidents that are NOT reported Psychological impact on survivors $
Slide 8: Value Chain
Value Chain 29 Detections Lead to … Responses Lead to … Investigations Lead to … Interventions Lead to … Deterrence Leads to … Healthier Communities
Slide 9: Key Statistics
OVER 15,000 sensors deployed in ~720 square miles under contract as of September 30, 2019 >100K Gunshot Alerts Published in 2018 ~100 Municipalities and cities, as of September 30, 2019 34 38% CAGR Revenue Growth (2015-2019 (est.) Key Statistics
Slide 10: Medium Term Growth Strategy
Grow Business to Over $100M of Diversified, Profitable, Recurring Revenues Protect and Maintain ~ $43M of Deployed ARR Add ~ 600 New Gross Domestic Miles ~ 100 Miles of Expansion ~ 500 Miles from New Customers ~ 100 Cities Grow International Business to ~ $15M in Annual Revenues Grow Missions & Secu
Slide 11: Growth Levers
Continue to Invest in Technological Innovation and Seek Platform Extension Opportunities Leverage NPS & Customer On-boarding / Success to Broader and Deeper Market Adoption Expand Go-to-Market Capabilities and External Partnerships Remain Passionate and Purposeful in Our Collective Work of Making a
Slide 12: Market Opportunity Product Update
Market Opportunity Product Update Sam Klepper, SVP Marketing & Product Strategy
Slide 13: $1B+ Total Addressable Market
$1B+ Total Addressable Market Core Domestic Public Safety ShotSpotter Flex Opportunity Currently in 100+ cities representing over 720 square miles under contract as of September 30, 2019 Gun homicides have increased 30% in the U.S. from 2014 - 2017 (Giffords) We estimate 1,400 domestic cities x $400
Slide 14: 2020 Marketing Plan
2020 Marketing Plan Market By Segment Messaging, Content Customization Build Out Personas Expand Understanding Of Influencers And Their Motivations Better Develop More Compelling Content Data On Results Customer Testimonials Partner Credibility Increase Cadence Of Campaigns And Start Formal Lead Nur
Slide 15: Market Segmentation
Market Segmentation Tier 1 Tier 2 Tier 3 Executive level ownership Regional Sales Director and SDR focus Telemarketing focus Tier 4
Slide 16: Law Enforcement Buyer Ecosystem
Law Enforcement Buyer Ecosystem Chief of Police DAs Local Hospitals Mayor/City Council Other Chiefs Associations Community Dept Staff
Slide 17: LVMPD Campaign
LVMPD Campaign Target Engaged Prospects Approach Show Happy Customer; Use Data To Prove Effectiveness; Play On Integration With Other LE Technology Message: How ShotSpotter Is Reducing Gun Violence In Las Vegas Outreach and content LVMPD Press Conference Video Companion Article SDR Follow-up
Slide 18: NIBIN Campaign
NIBIN Campaign Target 150+ Agencies Using CGIC but no ShotSpotter Champion/Buyer Head of CGIC/Chief or Deputy Chief Message ShotSpotter Maximizes Investment in CGIC Outreach and content Webinar - Customers Getting Results with SST + NIBIN Article “5 Key Steps” Video clips NIBIN Users who Added ShotS
Slide 19: Effectiveness: Chief Testimonials
Effectiveness: Chief Testimonials Chief video from IACP
Slide 20: Effectiveness: Customer Results
Effectiveness: Customer Results
Slide 21: Effectiveness: 3rd Party Studies
Effectiveness: 3rd Party Studies Urban Institute Conducted Study Of ShotSpotter’s Impact On Crime And How Police Adoption Can Impact Results Denver, Milwaukee And Richmond (2016-2019) Published Best Practices Guide Confirmed ShotSpotter's Ability To: Identify Gunshots That Are Not Called Into 911 Im
Slide 22: Privacy Concerns: Audit Policing Project At NYU Law School
Privacy Concerns: Audit Policing Project At NYU Law School Conducted Independent Review Of ShotSpotter Privacy Policies And Procedures Given Total Access To All Systems And Documentation And Total Editorial Control Over Report Content “We Ultimately Conclude That The Risk Of Voice Surveillance Is Ex
Slide 23: ShotSpotter's Technology Unanimously Passes Oakland's Surveillance Ordinance
OFFICER com TACTICAL TRAINING & CAREERS ON THE STREET COMMAND/HQ_ PRO SHOTSPOTTER’S GUNSHOT DETECTION TECHNOLOGY UNANIMOUSLY PASSES OAKLAND’S RIGOROUS SURVEILLANCE ORDINANCE City’s New Ordinance Sets High Bar for Law Enforcement Technology to Protect Individual Privacy Rights igations // Gunshot Loc
Slide 24: ShotSpotter Missions Launch (HunchLab)
ShotSpotter Missions Launch (HunchLab) Goal: Engage LE Agencies As Innovation Partners To Get Proprietary Insights Needed To Shape Missions Into A World-class Law Enforcement Tool Initial Target: Current ShotSpotter Flex Customers Intentionally Delayed Formal Launch Until Completed Integration With
Slide 25: 2020 Product Goals
2020 Product Goals Higher Lower Relative level of investment US Flex Missions Gain customer insights to enhance and differentiate product International Flex Enable new geographic markets Seed New Revenue Opportunities Explore Consumer / Business service In-country operations Ensure privacy complianc
Slide 26: ShotSpotter Labs: Rhino Poaching & Anti-Blast Fishing
ShotSpotter Labs: Rhino Poaching & Anti-Blast Fishing Overcame technical challenges of operating in remote / hostile environment Proven efficacy Possibility of commercial opportunity Earlier in development Unique challenges with underwater detection Food security impact
Slide 27: ShotSpotter Labs: Incubating with Stanford Engineering
COMPANY CONFIDENTIAL ShotSpotter Labs: Incubating with Stanford Engineering Materials Science
Slide 28: ShotSpotter Labs: Potential Future Consumer/Business Service
COMPANY CONFIDENTIAL ShotSpotter Labs: Potential Future Consumer/Business Service Ride-sharing Services & Delivery Service Routing to Avoid Gun Violence Incidents
Slide 29: Technology
Technology Paul Ames, SVP Technology Rob Calhoun, Co-Founder
Slide 30: ShotSpotter Technology Overview
ShotSpotter Technology Overview ShotSpotter Flex Is A Wide-Area, Acoustic Gunshot Detection Location And Alerting System
Slide 31: ShotSpotter Core Technology Overview
ShotSpotter Core Technology Overview
Slide 32: Spatial Filter & Location
Spatial Filter & Location - @+0.7s TOA ~ a =/ a
Slide 33: Adaptive Noise Filtering
Adaptive Noise Filtering Gunshots Are Impulsive Signals; Acoustic Power Is Spread Over A Broad Range Of Frequencies Cities Aren’t Quiet; Noise Is Our Enemy To Maximize Sensitivity, ShotSpotter Sensors Filter Input Audio Using An Adaptive Noise Filter (ABNR) Theoretical power spectrum of a gunshot (b
Slide 34: Adaptive Noise Filtering
Adaptive Noise Filtering 2nd closest (285 m) 3rd closest (570 m) add HVAC/machinery noise typical urban noise (8:30 am, I-94 at 800 m distance)
Slide 35: Pulse Set Selection
Pulse Set Selection Multi-lateration Is the Mathematical Technique of Computing a Location From a Set of Time Differences-of-arrival on Three or More Sensors The Challenge: Which Pulses to Use as Members of The Set? Pulse Set Selection is an NP-complete Problem, so We Shouldn’t Expect an Efficient A
Slide 36: Pulse Set Selection: Techniques
Pulse Set Selection: Techniques We use multiple algorithms to pick pulse sets: Combinatorial optimization Cross-sensor pattern-matching Forward solutions (numerical optimization) Others... The algorithms compete against each other, trying to find the largest set of sets of pulses consistent from nea
Slide 37: Pulse Set Selection: Pattern Matching
Pulse Set Selection: Pattern Matching Synthetic time-domain representations of gunshot impulses
Slide 38: Pulse Set Selection: Forward Solution
Pulse Set Selection: Forward Solution Assumes a Shooter Position and Computes Objective Function Optimize Location Iteratively Using Numerical Optimization Techniques to Maximize the Objective Function Can Include Effects of Moving-shooter and Non-linear Propagation
Slide 39: USPTO granted our 34th patent – Image Mosaics
USPTO granted our 34th patent – “Image Mosaics” - that leverages advances in image classification using convolutional neural networks for acoustic event classification Machine Classification Mosaic captures waveform features and metadata from the sparse array Classification confidence used for: Day-
Slide 40: 12/05/2019 @ 10:57:00 minutes ago
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Slide 41: Applications: Review
Applications: Review Internal Tool Used By IRC Released Q2 2019 Drive Quality And Speed Of Reviews: Proximal Incidents, Individual Shot Locations, Location Confidence, Context Switching, ‘Agree With Machine Classifier’, Reviewer Metrics, Virtual Review Centers, Etc. Q4 Deliverable: Peer Review Workf
Slide 42: Applications: Dashboard
Applications: Dashboard Internal Tool Used To Monitor, Troubleshoot And Analyze All Aspects Of Production System: Number Of Users Impacted By A Respond 2.9.1 Bug On iOS 13.2? Which Users Received A Push Notification For Incident 9751-80043? Last Month, How Often Did Human Reviewers Disagree With A G
Slide 43: Applications: Respond and Dispatch
Applications: Respond and Dispatch 17,000 Police Officers And 2,000 Dispatchers Use Our Applications Each Month Our Apps Are Responsive With A Single Code Base For iOS, Android, Web And Windows 2019: On-demand ILS, In-app Subscriptions, Analytics 2020: Data Transparency, Data Reconciliation
Slide 44: Competitive Architectures
Competitive Architectures ‘®} ShotSpotter
Slide 45: Competitive Architectures
Competitive Architectures Proximity Sensor Single Microphone That Uses Loudness To Detect A Gunshot Machine Classification On-board With No Human Review Coverage Limited To The Area Around The Sensor No Ability To Locate The Gunshot, Other Than Saying It’s ‘Somewhere Around Here’ Multi-mic Cluster S
Slide 46: Architectural Benefits/Limitations Comparison
Architectural Benefits/Limitations Comparison ShotSpotter Wide Area Sensor Array Proximity Sensor Multi-Mic Cluster Sensor Benefits Wide area coverage Excellent location Low false positive/false negative rates Court admissible evidence Fast notification Perceived low cost Fast notification Supersoni
Slide 47: Project Management & Service Implementation
Project Management & Service Implementation Joe Hawkins SVP, Operations
Slide 48: Operations Mission
Operations Mission Lead The Company’s Project Teams In Designing, Configuring And Deploying New Shotspotter Flex, CampusSecure, SiteSecure And Missions Service To Our Customers Build, Install, Manage And Maintain The Acoustic Sensor Networks That Make ShotSpotter Work Sensor Array Design, Installati
Slide 49: Project Management Overview
Project Management Overview Plan, Coordinate And Lead All Aspects Of Bringing New Service To Customers, From Contract Execution To Service Activation Primary Customer Contact During Deployment Project Team Leader (Matrix Management) Internally Network Services & Operations Engineering Field Service
Slide 50: Deployment Experience
Deployment Experience Seven Person Team 40 Years Collective Shotspotter Experience Extensive Backgrounds In Network Design, Systems Engineering, Sales And Public Safety Deep Relationships With Law Enforcement Shotspotter Flex™ 150+ Projects, 250+ Systems, 700+ Square Miles Projects Ranging 1 To 36 S
Slide 51: Deployment Project Scope
Deployment Project Scope Sales Service Delivery Deployment & Onboarding IRC, Support, Success, NetOps Project Start Go Live
Slide 52: Project Management Lifecycle
Project Management Lifecycle Multi-disciplinary, Parallel Work Effort Permissions Acquisition = Critical Path Control Gates
Slide 53: Project Team Role
Project Team Role Primary Responsibilities Project Manager Project Manager/Team Leader Sensor Array Design, Permissions, Live Fire Test Customer Success Customer Onboarding Network Operations Hosted Service Provisioning Sensor Network Management Field Services Sensor Installation & Management Supply
Slide 54: Sensor Array Design Principles
Sensor Array Design Principles Performance (SLA+) Overbuild (R&R, Serviceability, Cost Shift) Practices: Art & Science Environmental Factors & Sound Propagation Emplacements: Suitable, Math-friendly Density, Geometry And Spacing Hearing To The Horizon Hints And Exclusions Tools: Heat Maps, Surveys A
Slide 55: Sensor Array Design
Sensor Array Design Residential / Suburban (17/sm2) Urban / Densely Built (25/sm2)
Slide 56: Customer Support & Incident Review Center
Customer Support & Incident Review Center Nasim Golzadeh SVP, Customer Support and Professional Services
Slide 57: Customer Support
ie; ShotSpotter Customer Support
Slide 58: Customer Support and Professional Services
Customer Support and Professional Services Our Mission: Serving Law Enforcement to Detect, Protect, Connect Incident Review Center (IRC) Customer Support Forensic Services Integration Services Training
Slide 59: Incident Review Center (IRC)
Incident Review Center (IRC)
Slide 60: Incident Review Process
Incident Review Process ~45 seconds or less Confidence-based Machine Classification Auditory Review Of Pulses Waveform Assessment Proximal Incident Recognition Sensor Participation Levels, Distance, Direction Date, Time, Location, Season Consideration Peer Review Apply Appropriate Tags Classificatio
Slide 61: IRC Structure and Workflow
IRC Structure and Workflow Optimized Staffing Minimum/Maximum Load Ratio: 500% Peak Time Concentration Modeling Based On Detailed Day Of Week / Hour Of Day Demand Modeling & Projections Technology As Optimization Tool Suppression Smart Incident Prioritization Workflow Optimization Auto-Publish To Ex
Slide 62: Incident Review Accuracy
Incident Review Accuracy (Jan-Nov.) 2018 2019 YoY Chg. GS Published 97,315 130,284 32,969 34% Gunshot Classification Accuracy 98.80% 99.02% 0.0022 0.22%
Slide 63: Customer Support Matrix
Customer Support Matrix Support Level Tier 1 Support (Basic) IRC Tier 2 Support (Advanced) Customer Support Examples Login support General/application questions Reporting a misclassification Reporting a missed incident Reporting a Mislocated incident Basic audio request Request for ILS Proactive Sup
Slide 64: Incoming Support Inquiries
Incoming Support Inquiries All Statistics are for period from 3/30/19 to 11/30/19
Slide 65: Forensic Service and Litigation Support
Forensic Service and Litigation Support
Slide 66: Detailed Forensic Report (DFR)
Detailed Forensic Report (DFR) Court-admissible forensic analysis of a shooting incident with exact shot by shot location, precise time of trigger pull and audio of the gunfire Produced by forensic engineers and the conclusions reached are supported by expert witness testimony
Slide 67: Investigative Lead Summary (ILS)
Investigative Lead Summary (ILS) Provides individual shot sequencing, location and time-stamps to the officers for better evidence collection, confirming witness accounts, interviewing suspects and filling out the case file Available on demand and real time from the Respond app Averaging 150 reports
Slide 68: Litigation Support
Litigation Support Assistance Extended To District Attorney’s Offices During Evidentiary Challenges To ShotSpotter Evidence Documentation Case Studies Prior Case Law Expert Witness Preparation Expert Witness Testimony For Trials, Hearings, Grand Jury Presentments And Depositions Testified To In 17 S
Slide 69: United States vs. Godinez
United States vs. Godinez Shooting Of An ATF Agent In Chicago By A Known Gang Member On May 4, 2018 The DFR Precisely Located Where The Defendant Was Standing When He Fired 5 Rounds At The Agent The Other 2 Rounds Detected And Located Were Return Fire From A Chicago Police Officer Attached To The AT
Slide 70: Integration Services
Integration Services Increased Efficiency And Effectiveness Within The Customers’ Public Safety Ecosystem Increased Stickiness Revenue Opportunity VMS CAD/RMS LPR RTCC UAV Mapping Predictive Policing
Slide 71: ShotSpotter Notification Engine/API Footprint
ShotSpotter Notification Engine/API Footprint 60+ Existing Point-to-point Integrations Versatility Successful Integration With 25+ Different Public Safety Vendors/Systems Growth Growing Adoption Rate 25 New Integrations In 2019, Versus 10 In 2018 An Intentional Focus On Growing Our Integration Footp
Slide 72: Customer Success
Customer Success Paul Reeves VP, Customer Success
Slide 73: ShotSpotter Customer Success
ShotSpotter Customer Success Mission: Ensure Every ShotSpotter Customer Maximizes The Value (Success) Of ShotSpotter’s Public Safety and Security Solutions.
Slide 74: ShotSpotter Customer Success Team
ShotSpotter Customer Success Team ATF Special Agent - 26 years NIBIN National Coordinator – 15 years Major, Hillsborough County Sheriff – 31 years ATF Special Agent-in-Charge – 25 years Assistant Chief, Miami Gardens PD – 28 years Patrol – Officer, NYC - 5 years Crime Analyst – East Palo Alto PD - 1
Slide 75: Customer Success Program
Customer Success Program
Slide 76: Maximizing Customer Success
Maximizing Customer Success Onboarding Best Practices Annual Account Reviews Value Realization Coaching & Training Go-Live Partner Strategy and Program Design Analytics: Ongoing Health/KPIs Monitoring User Engagement: User Groups, Education Ongoing Coaching & Training
Slide 77: Net Promoter Survey
Net Promoter Survey Completed October 11, 2019
Slide 78: How NPS is Used
How NPS is Used Quantitative Measurement Of Customer Sentiment That Can Impact Sales And Renewals Coarse But Useful Indicator: Is It Working? Helping Identify References For Testimonials/ Identify Areas For Improvement Company-wide Bonuses Are Tied To NPS
Slide 79: Net Promoter Score Defined
Net Promoter Score Defined The Net Promoter categories evolved from Reichheld’s research, which also revealed distinct differences in customer behavior based on their response to the Net Promoter question. The high correlation between the response to the question and future behavior led to establish
Slide 80: Net Promoter Distribution
Net Promoter Distribution
Slide 81: NPS Score
World Class Excellent Good Average Poor NPS Score 53%
Slide 82: Net Promoter Response Distribution
Average response: 9.3 Detractors Passives Promoters Not at all likely Extremely likely Only New Agencies – Net Promoter Response Distribution
Slide 83: Community Impact Statements
* Figures on the chart above exclude “Don’t know / N/A” selections. **Percentages may not add to 100% due to rounding. Agree / Disagree – Community Impact Statements 2018 Score 93% 90% 85% Top 2 Box – Cumulative Percentage of “Agree” and “Strongly Agree” Responses
Slide 84: Community Impact Statements
* Figures on the chart above exclude “Don’t know / N/A” selections. **Percentages may not add to 100% due to rounding. Agree / Disagree – Community Impact Statements 2018 Score 63% 52% Top 2 Box – Cumulative Percentage of “Agree” and “Strongly Agree” Responses
Slide 85: Positive Sentiment: Applications, Reports and Services
Positive Sentiment: Applications, Reports and Services “ ” The Investigative Lead Summary is yet another example of what proves that ShotSpotter is ever evolving with technology and looking to provide the best products possible based on needs of its customers. The Rochester Police Department has alr
Slide 86: Agency survey results on benefits and community impact
Over 95% of agencies responding to the benefits / community impact questions “agree” or “strongly agree” ShotSpotter helps: Increase the number of shell casings recovered Increase the percentage of shots identified Reduces officer response times to gunshot crime scenes At least 75% of agencies also
Slide 87: Benefits of ShotSpotter – Comments
Having ShotSpotter has really helped us in responding quicker to shooting scenes. This has helped our solvability rate as well. – Police Dept., Atlantic City, NJ ShotSpotter has improved our response time, has garnered us positive community responses, and works as advertised. – Assistant Chief, Loui
Slide 88: Customer comments
We use this technology each and every day to help improve public safety for the community. – Police Dept., Wilmington, DE ShotSpotter has exceeded our expectations. The intelligence and real time data it provides is invaluable. Great company with outstanding service team and customer service. ShotSp
Slide 89: Next Steps Opportunities
Next Steps Opportunities Net New Square Miles: 16 Agencies indicated they would likely expand their area of coverage in the future (versus 7 in 2018) The Value of Promoters: 57 respondents, representing 44 agencies, agreed to serve as a reference or provide a testimonial Customer Retention: 35 of 36
Slide 90: LATAM Market Opportunity
LATAM Market Opportunity Jon Magin, VP International Sales, LATAM
Slide 91: LATAM Opportunity & Focus
LATAM Opportunity & Focus Overview: LATAM Averages 24 Homicides Per 100k People 9% Of World Population And 40% Of All Murders Crime #1 Public Concern (Replacing Economy) Crime Cost Totals 3.6% Of GDP (Represents $2.6B In $US) Progress: Visited 10 Countries In 18 Months (Multiple Times) Meetings With
Slide 92: Countries with Highest Gun Deaths
Countries with Highest Gun Deaths
Slide 93: LATAM – Homicide Rates Per 100k
LATAM – Homicide Rates Per 100k
Slide 94: Brazil – Gunfire Homicide Stats
Brazil – Gunfire Homicide Stats Source: Reddit
Slide 95: Mexico – Concentration Homicide Rates
Mexico – Concentration Homicide Rates Dec 2018 – Aug 2019
Slide 96: Mexico – C5 Command & Communications
Mexico – C5 Command & Communications
Slide 97: Colombia – Murders & Socio-Economics
Colombia – Murders & Socio-Economics
Slide 98: LATAM – Collaboration In The Region
LATAM – Collaboration In The Region Software Company – HQ Visit – Leveraging 20 Direct Sales & Marketing Contacts In Region. Participated As A Speaker In Various Partner Customer Conferences. Joint Sales Calls To 15 Integrator/Customer Visits Security Hardware Company(s) – HQ Visit – Leveraging Sale
Slide 99: LATAM – Marketing
LATAM – Marketing Mexico – Hosted Delegation of State Security Secretaries Mexico – Hosting Reception for Police – (200 Officials) Mexico – ExpoSeguridad Booth, May 2019; Largest Security Exposition in Northern LATAM Brazil – LAAD Security & Defense Expo booth; April 2019. Largest Security Expositio
Slide 100: Sales – North America
Sales – North America Gary Bunyard SVP, Sales, North America
Slide 101: 2019 Flex Bookings – Highlights
2019 Flex Bookings – Highlights Booked (as of November 30, 2019): New Flex Miles 85 New Security Miles 2 Total New Miles 87 New Customers 9 Expansions 9 Highlights: Las Vegas Metro Police – expansion Puerto Rico Public Housing Authority Bookings: Gross New Miles Under Contract
Slide 102: 2019 Flex Bookings – Las Vegas expansion
2019 Flex Bookings – Highlights Booked (as of November 30, 2019): New Flex Miles 85 New Security Miles 2 Total New Miles 87 New Customers 9 Expansions 9 Highlights: Las Vegas Metro Police – expansion Puerto Rico Public Housing Authority Signed expansion contract – September 15th Great collaboration
Slide 103: 2019 Flex Bookings – Puerto Rico contract
2019 Flex Bookings – Highlights Booked (as of November 30, 2019): New Flex Miles 85 New Security Miles 2 Total New Miles 87 New Customers 9 Expansions 9 Highlights: Las Vegas Metro Police – expansion Puerto Rico Public Housing Authority 2 Competitive RFPs Round 1 – produced no viable competitors Rou
Slide 104: 2019 Flex Bookings – Year-End Sales Funnel
2019 Flex Bookings – Highlights Booked (as of November 30, 2019): New Flex Miles 85 New Security Miles 2 Total New Miles 87 New Customers 9 Expansions 9 Highlights: Las Vegas Metro Police – expansion Puerto Rico Public Housing Authority Year-End Sales Funnel: Working Opportunities 6 Potential New Fl
Slide 105: Flex Bookings – Historical View
Flex Bookings – Historical View
Slide 106: Flex Bookings – Historical View (without Chicago & NYPD)
Flex Bookings – Historical View (without Chicago & NYPD)
Slide 107: ShotSpotter Sales Organizational Changes
ShotSpotter Sales Organizational Changes Objectives: Expand The Depth/Breadth Of Leadership Allow Senior Sales Leadership To Be More Strategically-Focused Create A More Scalable Sales Engine Expanded Products Expanded Volume Increase Velocity Position Regional Sales Directors To Focus More On New Cu
Slide 108: ShotSpotter Sales Leadership
ShotSpotter Sales Leadership Phil Dailly VP of Sales – Solutions Group Graduated James Madison University with a B.A. degree (Major in Political Science and Minor in Economics) Attended the Baltimore City Police Academy where Phil graduated Class Valedictorian Served as a Police Officer & Sergeant o
Slide 109: ShotSpotter Sales Leadership
ShotSpotter Sales Leadership Joe Rodriguez VP – Regional Sales Spent The First Four Years Of His Career Working As A Police Officer In Miami Worked Five Years At Tiburon, First As Regional Sales Manager And Then As Sales Director Lead Sales At Intergraph, As US Director Of Sales For Public Safety Jo
Slide 110: New ShotSpotter Sales Organization
New ShotSpotter Sales Organization Gary Bunyard Sr. VP – Sales North America Karen Isotalo Director – Sales Operations Joe Rodriguez VP – Regional Sales Phil Dailly VP – Solutions Group
Slide 111: ShotSpotter Sales Organization – looking back
ShotSpotter Sales Organization – looking back Southwest West Northeast Southeast Midwest Flex Product Sales Security/Missions Product Sales SVP – North American Sales Sales Operations Dir-Sales Ops
Slide 112: ShotSpotter Sales Organization – in process
ShotSpotter Sales Organization – in process VP - Regional Sales Southwest West VP – Solutions Group Northeast Southeast Midwest Flex Product Sales Security/Missions Product Sales SVP – North American Sales Sales Operations Dir-Sales Ops
Slide 113: ShotSpotter Sales Organization
ShotSpotter Sales Organization VP - Regional Sales Southwest West VP – Solutions Group Northeast Southeast Midwest Flex Product Sales Security Product Sales Missions Product Sales Future Product Sales SVP – North American Sales Sales Operations Dir-Sales Ops
Slide 114: ShotSpotter Sales Organization
ShotSpotter Sales Organization VP - Regional Sales Southwest West VP – Solutions Group Northeast Southeast Midwest Flex Product Sales Security Product Sales Missions Product Sales Future Product Sales SVP – North American Sales Sales Operations Dir-Sales Ops Lower Tier Sales Lower Tier Sales Contrac
Slide 115: ShotSpotter Sales Model
ShotSpotter Sales Model - Controls Territory Business Plans Salesforce Product Sales Playbook Opportunity Playbook This Photo by Unknown Author is licensed under CC BY
Slide 116: TAM Analysis - Total Addressable Market
TAM Analysis - Total Addressable Market General Forces Business Objectives Existing Customers Ranked Remediation Plans Account Review Plan Sales Funnel Existing Customers New Customers Sales Commits Existing Customers New Customers Profile - Top 5 Opportunities General Challenges Business Outlook Re
Slide 117: TAM Analysis
TAM Analysis General Forces Business Objectives Existing Customers Ranked Remediation Plans Account Review Plan Sales Funnel Existing Customers New Customers Sales Commits Existing Customers New Customers Profile - Top 5 Opportunities General Challenges Business Outlook Regional Territory Business P
Slide 118: TAM Analysis
TAM Analysis General Forces Business Objectives Existing Customers Ranked Remediation Plans Account Review Plan Sales Funnel Existing Customers New Customers Sales Commits Existing Customers New Customers Profile - Top 5 Opportunities General Challenges Business Outlook Regional Territory Business P
Slide 119: TAM Analysis
TAM Analysis General Forces Business Objectives Existing Customers Ranked Remediation Plans Account Review Plan Sales Funnel Existing Customers New Customers Sales Commits Existing Customers New Customers Profile - Top 5 Opportunities General Challenges Business Outlook Regional Territory Business P
Slide 120: Product Sales Playbook
Product Sales Playbook Value Proposition, ROI, and Messaging Sales Collateral for each Product Pricing Model Optimization Demand Generation Proposal Template Optimization Alternative Funding Sources Competitive Landscape Key Partners SME by Product Presentations/Demonstrations Consultative Role – Sa
Slide 121: Salesforce
Salesforce Today: Opportunity Management Funnel Management Proposal Request/Tracking Renewal Processing Competitor Tracking Task Tracking Moving forward: Funnel Source Dashboards Funnel Analysis Velocity Tracking Sales-Cycle Tracking Funding Sources Performance (Plan vs Actuals) Focus: visibility, a
Slide 122: Opportunity Management Playbook
Opportunity Management Playbook Lead Generation Community Meetings Council/Board Approval Contract Approval Contract Negotiation Proposal Approval Funding Options Sole Source Justification vs RFP Proposal Generation Analysis of Customer’s Crime Data Net Promoters ShotSpotter Briefing(s) Establish Ad
Slide 123: Market Forces at Play
Market Forces at Play Head Winds: Budgets Are Tight Competitive Distractions DOJ – Rejecting Sole-source Deals Tail Winds: Positive ShotSpotter Results More Regional “Tipping Points” Growing List Of Net Promoters Flex Sales Funnel – 2020 & beyond Prospecting Qualifying Active Opportunities Proposal
Slide 124: Business Model & KPIs
Business Model & KPIs Alan Stewart, CFO
Slide 125: Business Model Highlights
Business Model Highlights Annual subscription-based SaaS revenue Efficient sales and marketing Low customer acquisition costs High margin and low variable costs = Rapid cash payback of installation costs Significant leverage in every operating expense category Low customer attrition/churn High reven
Slide 126: SaaS Recurring Revenue Model
Revenue in millions of dollars SaaS Recurring Revenue Model (1) Includes $170K in revenue from USVI related to Hurricane Irma Nearly 100% of revenue is subscription based. 12 10 8 6 4 2 0 Q318 Q418 Q119 $6.5 $6.9 $8.9 $9.2 $9.7 $9.6 Q417 Q118 Q218 Q219 $10.3 Q319 $10.0 (1)
Slide 127: Customer Growth By Commencement Year
FY 16 FY 17 FY 18 FY 15 and Prior Customer Growth By Commencement Year ~$10M ~$25M
Slide 128: Strong Revenue Growth
Strong Revenue Growth 5 || 7 7 ; 92016 w2017 2018 92019 = 2020 ‘= ShotSpotter’ 128
Slide 129: Operating Leverage
Operating Leverage CAGR Revenue Growth (2015-2018) | 43% Revenue Growth Q3’18 to Q3’19 | 8% $9.2 $10.0 Q3 2018 Q3 2019 $5.0 $5.9 60% 55% $ in Millions
Slide 130: Selected Income Statement Data & KPIs
Selected Income Statement Data & KPIs YEAR ENDED 12/31 PERCENTAGE QUARTER ENDED 9/30 PERCENTAGE YTD $ 000’s 2017 2018 2017 2018 Q318 Q319 Q318 Q319 Revenue $23,763 $34,753 100.0% 100.0% $9,212 $9,984 100.0% 100.0% Gross profit ($000 and % of Revenue) 11,600 19,221 48.8% 55.3% 5,042 5,965 54.7% 59.7%
Slide 131: 2020 Guidance Build
2020 Guidance Build $4-$5M (Less $1 attrition) $1.5M $1M ~$43M
Slide 132: Capital Allocation
Capital Allocation M&A Acquired Hunchlab Technology (Missions) Total Cost Less Than $3M (Including Earnout) Significant Potential Value Creation Share Repurchase Sold 250,000 shares in 2019 – Netting >$11.2M Repurchased ~260,000 Shares for Cost of ~$6.5M As of December 17, 2019
Slide 133: Key Investment Themes
Large and Under-penetrated Market Opportunity First Mover Advantage in a Market with Little/No Direct Competition Significant Barriers to Entry – Technology, Experience & Brand Reputation Vertical Business Model Advantage Growing Revenues (33% CAGR – 2016- 2020 (est.)) “Sticky” Revenues (139% Revenu