SCT is one of those tech stocks that has serious multi-bag...

SCT is one of those tech stocks that has serious multi-bag potential. I'll outline my thoughts below:

The Team Behind SCT:

Scout Security also known as Scout Alarm was founded by Dan Roberts and Dave Shapiro. They both worked at Sandbox Industries in Chicago, Illinois.

Sandbox Industries is a major venture capital firm in the United States co-founded by Nick Rosa and Robert Shapiro (note the last name).

The initial funding for Scout Security was seeded by Sandbox Industries which assisted with research and development, marketing activities and initial startup costs.

Particularly interesting is Robert Shapiro, who is a major player in the corporate scene.

You can read more about him on his wikipedia page: https://en.wikipedia.org/wiki/Robert_B._Shapiro

Important notes:

- Former President, Vice President and CEO of Monsanto. Oversaw major growth with Monsanto.
- Former CEO and Chairman of Nutrasweet (Aspartame used in Pepsi etc)
- Served on the boards of Citigroup, Rockwell International, Sequus Pharma, NYSE Euronext, Silicon Graphics
- Trustee of numerous hospitals
- Served on the United States President advisory committee on trade policy
- Served on White House Domestic Policy Review of Industrial Innovation
- Fellow of American Academy of Arts and Sciences

To summarise, Robert Shapiro (the cofounder of Sandbox Industries that funded Scout Security) is a major player in the US. corporate and corporate governance scene.

Source 1, Source 2, Source 3






https://www.nbcnews.com/tech/gadgets/scout-brings-home-security-internet-age-its-cheap-flna1C8381570

Venture capital firm and start-up foundry Sandbox Industries funded early R&D and PR for Scout, a home security device start-up.

We can clearly establish that Robert Shapiro's Sandbox Industries was fundamentally behind the formation of Scout Security ("Scout Alarm"), through funding and two of it's former employees, Dan Roberts and Dave Shapiro (possible relation to Robert Shapiro).

SCT Prospects

With Sandbox Industries playing a critical role in the formation of Scout Security, it is no surprise they were quick to receive investment from Amazon (privilege attained by very few) and Prosegur. The product is also sold through Walmart.

Prosegur is a major player across the world in the security industry, 1.29b market cap and annual revenue of over 4 billion is nothing to be scoffed at. You can draw a comparison between Prosegur and Brinks.

What particular interests me about Prosegur is the white label arrangement, which will enable Scout Alarms to be re-branded as Prosegur (the physical product, the app etc) and sold by Prosegur to non-US markets.

Recently, Telefonica with market cap of 22b, obtained 50% of Prosegur Alarms Spain for €300 million, which is the Prosegur division responsible for retailing residential and commercial alarms in Spain. Prosegur Alarms is valued at €600 million, which highlights the potential sales for a Scout Alarm product branded as Prosegur Alarms within Spain only (let alone rest of the world).

Refer to announcement here: https://www.telefonica.com/en/web/press-office/-/prosegur-and-telefonica-close-the-deal-for-the-joint-management-of-the-alarm-business-in-spain



Prosegur aside, Scout Security has been working on a similar white label deal with Black+Decker (24.4b market cap). The market is expected to be updated on the progress of this arrangement this year.


While maintaining direct sales channels through the Scout Alarm website (www.scoutalarm.com), Amazon.com and Walmart.com, the company is increasingly concentrating on white label arrangements.

Personally, I believe white label arrangements offer the best upside potential. In the retail sector, even for a product like Scout Alarm with numerous unique selling points, it is hard to stand out from the crowd.

Scout Alarm (probably because of Robert Shapiro and Sandbox Industries) has had no issues attracting interest from major players such as Amazon and white label arrangements with Black+Decker, Prosegur and Zego. We can expect more similar arrangements with majors down the line.

The white label arrangement allows companies like Black+Decker and Prosegur to receive a monthly rate of their choosing from their customers, while Scout Security is also paid the agreed monthly subscription. This provides a reliable monthly revenue stream in addition to the profits from each unit, that both Scout Security and the white label partner benefits from.

In the current economic climate, companies are looking to diversify their revenue streams and generate additional revenues from their existing client base. The white label arrangement provides the perfect opportunity to do so. Likewise the existing arrangement with Zego.

In lieu of the recent rioting in the United States, economic malaise and instability due to Covid-19, I am of the opinion that security alarm sales will be on the increase. Scout Security is best positioned to leverage industry growth through white label arrangements.

To highlight their emphasis on white label arrangements, they're recently employing (March 2020) to bolster their staff in this sector (which suggests substantial news to come): https://www.builtinchicago.org/job/product/senior-technical-product-manager/94569

Senior Technical Product Manager at Scout Alarm
SCOUT ALARM | CHICAGO


I've been buying at these levels. I think we're going to see more major deals and major orders from B+D and Prosegur.

I'm also fond of the product, the team have concentrated on developing an excellent API and likewise have made integration into other APIs (devices) of forefront importance. I believe that Scout Alarm boasts the strongest integration suite of any alarm product on the market.

Easy to install, affordable units and monthly subscription, wide range of integration... White label arrangements with majors, what isn't there to like?