The Access Control Phase Change. It is a Culling of the Herd.
As part of the phase change that is upon our industry, we are starting to see some clear separation between those that will grow, survive, and lead in the new world versus those that will lag, stay put, or go out of business in the old world.
If you look at the diagram, you will see how the current physical access control industry is seated. You have “islands” of Old Tech, Today Tech, Tomorrow Tech and Future Tech.
The majority of our industry today lives on “Old Tech Island” but we are starting to see part of that decay and a lot of movement on “Today Tech Island” (See my previous comments on Brivo and Parakeet as an example).
We are not far from Today Tech being just that… Today. But, the reality is, we, as an industry, primarily live on “Old Tech Island.” This is not a case of if “Today Tech” will happen, but when it will happen. I feel the phase change from OId Tech to Today Tech is happening at a higher rate than we have seen historically. Hence the importance to have the conversation now.
Before I get into my story of the islands (see part 2 below), I will give you my reason for this analogy. I think it's important that we name the behaviors of our industry, whether internally or externally, incumbent or new, in an effort to help each other, drive change, and create spaces for honest conversations. By naming the behaviors you and our community have an opportunity to point to it, digest it, and address it properly. It can be a lot of things. It can be negative comments or feedback on something that is new because of fear. It manifests itself in comments like “We’ve tried that before.” It can also be frustration on why things that seem like no brainers, are in fact difficult to get traction. It manifests itself in comments like “why do we still use prox?” And so on.
I have been using this framing often to explain our landscape to companies inside and outside of our industry. Its works for me no matter the subject:
- Where are we today with technology?
- Where is most of the marketing messages focused?
- Where is XYZ company right now as far as innovation?
- Why have we not seen mass adoption? Etc.
This helps me frame discussions and start to critically think about companies in our space. For instance, here are two companies on "Old Tech Island" that are making moves or have potential to break through to leading Today Tech and Tomorrow Tech:
LenelS2: I am very intrigued by LenelS2. I feel they are at a pivotal moment. They have potential to not only lead into Today Tech but they could accelerate that growth and clearly separate themselves from the “old steel” of our industry. To do so they need to make even bolder moves than they have up to today. Examples of what that would look like is leverage S2 more for a culture change and attracting new talent, open source Blue Diamond, change the “because thats how we do it” business models, make integrating with third parties easier and more of a priority, and lastly, double down on mainstream marketing. Alternatively, they could easily fumble the leadership opportunity away and never leave “Old Tech Island.” They won’t die on “Old Tech Island,” but if they don’t get off it, they will never realize their true potential.
Feenics: They are set up for success and I am sure they are feeling good about what they’ve done so far. I am not discounting their success. They came in as the newer cloud based access control system, they started to market and differentiate themselves based on their architecture and roots as a dealer in Canada, and it has done fine by industry standards. But, I know they and the industry wants more. They have tendencies that come straight out of the “Old Tech Island” playbook and they allow themselves to look a lot like Old Tech. With a few tweaks, they could see exponential growth above and beyond what they see today. They could lead “Today and Tomorrow Tech.” But it is going to take some bold decisions like investing in mainstream marketing, charging hard into new channels, and telling their story a lot better.
Here are some examples of companies that are on "Today Tech Island” and “Tomorrow Tech Island'' you should keep an eye on. They have potential to lead the new wave of how our industry looks. They also have the same potential to lose focus and run out of runway if they don’t execute properly or if they allow Old Tech to slow them down. Examples of companies with this opportunity are:
- Envoy: Office experience that will shape access control as a feature.
- Traction Guest: Enterprise identity management covered up by enterprise visitor management that will shape enterprise access control as a feature.
- RapidSOS: Mustering done right that will drive specifications of access control companies that work with them.
- Openpath: Modern day access control systems with a clear value add message that is sucking the oxygen out of the room.
- Proxy: Federated identity covered up by an access control system.
It is worth noting, the reason our industry is ripe for this phase change to happen is that there is no single dominant player on any of the island.
We do not have an Amazon*, Apple, Google or Facebook of our industry. Our industry incumbents on “Old Tech Island” will not buy the Today and Tomorrow Tech companies because they will not take the risks associated with it. Whether its paying the premium valuations VC backed startups get today, tough culture conversations with their existing team, or because they do not believe they need the new company to deliver their goals; incumbents in our industry, at this point, do not seem to value startups or VC backed companies the same way technology companies like Amazon, Google, Apple or Facebook do. Why? In my opinion because they are not willing to go early, they allow room for the disruption and in a way create the phase change to happen.
Comes down to this - if you are on “Old Tech Island” and want to get to “Today Tech Island” or a start up on “Today Tech Island” and want to lead: What are you going to do with the opportunity?
*Side note: It is worth mentioning that Amazon has introduced Key for Business. They aren’t just coming. They are here already.
By the end of 2020 we will see clear lines of delineation on “Old Tech Island” between the companies that will stay on it and suffer a painful, slow death and those that will move to Today Tech Island and become much larger and stronger. We also start to see some of the start ups that started on Today Tech Island become legitimate and formidable players in the space.