There’s been a lot of discussion about fighting crime in recent months, with many issues debated in the recent US presidential campaign. With the emergence of rapidly advancing technologies and robotics, we are on the cusp of a revolution in how crime is detected and addressed, with vast implications to the effectiveness and economics of future law enforcement.
One startup leading this movement is Knightscope, Inc., a Silicon Valley-based company that manufactures autonomous robots that are already used by many businesses across the country to detect crime. Knightscope recently launched a Reg A+ mini-IPO seeking to raise up to $20M. The company previously raised over $14M in its Seed, Series A and Series B rounds of financing.
“If you add up all the negative economic impact of crime on the US annually, it’s a trillion dollars. If you add up all the hospitals, prisons, police officers and everything, it’s a hidden tax we all pay every single year,” said Knightscope CEO William Santana Li in a recent interview with Equities.com broadcast contributor Silvia Davi. “What if a company could come up with a set of technologies that could literally, in the long-term, be able to cut it in half? And the way to do that is what we call autonomous data machines.”
Knightscope machines are renowned in the field for their ability to not only see, hear and smell potentially criminal activity in their vicinity, but also their ability to “provide a physical presence and roam around autonomously, like a self-driving car,” Santana Li says. So, does that mean we’ll soon see Knightscope security robots putting security guards out of work? “Absolutely not,” Santana Li insists. “The most powerful combination is software, plus hardware, plus human. So, you want the machines to do the monotonous, computationally heavy work, and then let the humans do the strategic, decision-making work.”
“So, no human would be able to, say, read 300 license plates a minute, be able to keep track of everything, and say, ‘Wow, that’s over 400 degrees, that’s probably a high risk of a fire.’ Or, ‘that mobile device hasn’t moved in over 17 hours, I wonder if someone lost a mobile device, or something much worse.’ So the idea is to give the human that capability at their fingertips,” explains Santana Li.
Perhaps the best endorsement of Knightscope comes from the fact that they’re already entrusted by a wide swath of well-known companies. “Right now, Knightscope is based out of Silicon Valley, we’ve been deploying across California,” Santana Li says. “We’re in nearly a dozen locations, operating 24/7 on corporate campuses, malls and stadiums. The Sacramento Kings are a client, Microsoft (MSFT), Juniper Networks, Dignity Health, a big hospital network, and one of the uses of proceeds for our mini-IPO that we’re raising right now is to expand nationwide across all fifty states.”
Why Should Investors Choose Knightscope?
So, in a broadly expanding Reg A+ marketplace, why should investors choose Knightscope? “One is, I think everyone’s tired,” says Santana Li. I think everyone’s tired of seeing some awful thing happen on their newsfeed every single morning, and not be able to do something about it. Even the President of the United States hasn’t been able to solve all the mass shooting issues. And folks are tired of backing politicians that don’t actually deliver, and it’s all words and no actions. Now, here’s an opportunity to actually back a company who’s trying to solve the problem with technology.”
Santana Li continues: “The second thing is… over the last several decades, +98% of the population has never been able to invest directly in a Silicon Valley startup. They just were not allowed to do that. But now, with the new regulations that have been in place for almost a year now, they’re now allowed to, in the comfort of their own home, go to Knightscope.com, click the invest button, and literally be able to buy preferred shares in our company.”
Knightscope is well-positioned in this regard, because, as Santana Li explains, for investors interested in a security play in the tech sector, the company is the “first mover in the market, being able to scale not only autonomous technology, but an application for security at scale.”
What’s Next for Knightscope?
How will Knightscope, Inc. use proceeds they receive from the capital raise? “Three things,” says Santana Li. “One is to expand nationwide. Two, to develop weapon detection capability – so to be able to see a visible or concealed weapon – and that would be very important for some pretty sensitive locations, like an airport or something like that. And the last is to build a K-7.” The K-7 would add to their currently operating robots: the four-foot tall K-3, for use indoors, and the five-foot tall the K-5, which roams around outdoors. The K-7 will be a four-wheel version that’s designed to traverse much more difficult terrain.
Knightscope’s tech is clearly impressive, but the question remains… does it work? As Santana Li explains, they’ve already seen the tech put to good use. “One of the big wins for 2016 for us, Santana Li says, “we had a client who had been experiencing two criminal-related incidents a week at their location. Since we’ve been deployed there, the number has gone down to zero.”
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