Digging Deeper Into Genasys' Acquisition of Zonehaven — A Fuel For Its Global Expansion?

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Genasys Inc. GNSS has, over the years, carved a niche for itself as a global provider of critical communications systems and solutions that help protect and keep people  safe.

The San Diego-based company offers a multichannel approach to deliver geo-targeted alerts, notifications, instructions, and information before, during, and after public safety threats and critical business events in several industries, including government, utilities, enterprise, and non-profit. 

In an industry that includes players like BK Technologies Corp. BKTI and Cadre Holdings Inc. CDRE, Genasys believes it has laid a solid foundation that sets it apart from the competition.

One important acquisition was Zonehaven — a fast-growing provider of software-as-a-service (SaaS) solutions for emergency evacuations — in June 2021. Zonehaven provides planning, training, and resources to first responders, public safety agencies, and communities to manage evacuations and repopulations successfully.

Zonehaven’s services are trusted by more than 170 fire districts, 140 law enforcement agencies, and 200 cities, with more than 3,300 evacuation zones in Northern California and Southern Oregon. With the recent announcement of four additional counties in California,  Zonehaven’s critical evacuation planning, alerting, and real-time safety information are now available to first responders, emergency services agencies, and more than 7.3 million California residents under annual recurring revenue contracts.

Richard S. Danforth, CEO of Genasys, explained the acquisition was critical because of the increasing wildfire, flooding, severe weather, active shooter, and other crisis events that require proven solutions to help quickly move people away from danger.

“We have recently seen in California and other areas of the world that critical events require preparation, real-time information, and dynamic resources to keep people safe. By empowering agencies and communities with essential tools to safely execute timely emergency evacuations and orderly repopulations, Zonehaven’s solutions help save lives,” he said.

Has Zonehaven Enhanced Genasys’ Software Platform?

Genasys believes that the acquisition of Zonehaven has enhanced its software platform and growth opportunities by adding new features and capabilities and expanding its customer base and reference sets.

Transaction Details

• Genasys acquired Zonehaven in June 2021 for $24.2 million.
• SaaS solutions focus on emergency evacuation management that provides planning, training, alerting, and resources to first responders, public safety agencies, and communities to manage evacuations.

Strategic Rationale

• Provides Genasys with key competitive advantages for landing local, regional, and national emergency management and warning contracts.
• Opportunity to cross-sell GEM to Zonehaven customers and upsell Zonehaven to existing GEM customers.
• Integrating Zonehaven with GEM enhances both offerings' value proposition and technological capabilities.

Results

• The acquisition paves the way for a rapidly growing business pipeline for integrated systems with opportunities in California and the western U.S.
• Genasys has announced multi-year Zonehaven software contracts with 17 counties in California covering 7.3 million residents.
• Genasys expects to win many additional Zonehaven contracts in the fiscal year 2022 (FY22).

Zonehaven SaaS Platform Acquisition

• Empowers public safety agencies and communities with tools to execute timely evacuations and orderly repopulations.
• Offers stand-alone service and ability to integrate with GEM platform.
• Provides competitive advantage for landing GEM, IMNS, and NEWS.
• Bridges the gap between first responders and the public by transforming disaster preparedness.

Genasys’ Investment Highlights

• Track record of execution: Winning large, multi-year contracts with municipalities, governments, military and defense organizations, and commercial enterprises globally
• Multiple growth levers: Growing SaaS government and enterprise revenue with GEM, IMNS, Zonehaven, and NEWS. 
• Financial profile with SaaS: Improving SaaS revenue growth to lift gross margin and improve profitability.

Reported Key Growth Drivers and Global Expansion 

• Crucial service: Increasing need for emergency warning and public safety driving demand for Genasys’ full suite of systems and solutions.
• Need for comprehensive integration: Integrated solutions provide a key competitive advantage with government and enterprise customers.
• Revenue stability: Competitive advantages of Genasys’ market-leading LRAD long-range communication systems support hardware revenue stability.
• Expanded reach: Execution of SaaS strategy and expanding geographic reach drives software revenue growth.

Genasys expects substantial U.S. and international growth in SaaS sales in FY22 and beyond. 

The company believes that its unified, multichannel platform is uniquely positioned to capitalize on growth in the critical communications and mass notification markets with industry-leading hardware and software solutions.

This post contains sponsored advertising content. This content is for informational purposes only and is not intended to be investing advice.