SECURITY SALES & INTEGRATION recently posted a podcast featuring Vivint Co-Founder and CEO Todd Pedersen. In the podcast, Pedersen revealed how his company grew 825% in five years, and addressed hot topics such as door-to-door sales, competition from telecoms and how he motivates employees. Below is a full transcript of the conversation:
Welcome to SECURITY SALES & INTEGRATION‘s “Security Speaking” podcast. I’m Scott Goldfine, Editor-in-Chief of SSI. I thank you for listening as each week we discuss the trends, issues, opportunities, challenges, technologies, and more affecting today’s electronic security industry professional.
My guest today is Todd Pedersen, CEO and Co-Founder of Vivint, one of North America’s largest security and home automation installation and monitoring services providers. Under his leadership the company, about a year ago, rebranded from APX Alarm Security Solutions, or APX, to Vivint to reflect its extended portfolio of offerings. The company’s achieved 825% growth the past five years and how has around a half-million customers.
In addition, Todd has created a company culture where employees enjoy a unique experience and participate in community service through Vivint Gives Back, which has provided more than a million dollars and thousands of hours of volunteer labor to tens of thousands of families and organizations in need. This past year, the program was recognized with the SAMMY Award for best community outreach. Todd, thanks so much for joining me today.
Todd Pedersen: Thank you, good to be here. I’m here, you’re there, but nice to be on the phone with you.
I appreciate it. The growth and success you’ve had with Vivint is nothing short of astonishing, especially in light of the economy and compared to other security installation monitoring providers out there. In a nutshell, how have you accomplished this and for lack of a better word; what’s your secret?
Pedersen: That is such a broad question but here’s what I would say. We appreciate the fact that we have been able to grow but one thing that may be interesting with the culture that we have here is I think our view on growth and our capability is pretty large. In fact, when I look back on the last five or six years of growth, disappointed probably isn’t the right word because again, I am happy that we were fortunate enough to grow and be in a position to grow because of the tough economic environment, capital constraints; obviously the lending market was tough and in this industry you rely on debt for growth, unless you’re just barely growing, but we’re growing pretty rapidly. It limited our ability to attain what we could have or should have gotten to as a company. Even though it looks like pretty phenomenal growth, what could have been would have been substantially different, and more than that.
I think that maybe part of our culture is we’re never satisfied, ever, in anything that we do. I was just telling someone that this morning, someone was asking me about the company. I said the funny thing is if someone comes in and hits their goal there’s huge disappointment in that. It’s absolutely demolish goals on every aspect. This is not just volume growth but every aspect of what we do as a company or there’s great disappointment because that’s not the expectation we put on ourselves. I don’t know if that’s a weird say to look at things but it’s how we are as a group, as an executive team, I think even middle management, In fact, I think that’s driven all the way down in the culture. We’ve got call center people that handle the customers on a daily basis and technical support. I think they all buy into that and over exceed expectations.
Todd, I’m very curious; how did you actually get involved in the security business in the first place? You go to the beat of your own drummer. I’d like to know how you got into it, and what is it about it that you really enjoy and what gives you headaches?
Pedersen: We do a lot of door-to-door sales, even though we are rapidly developing additional channels, television, internet, so a lot of internal sales. In fact, I think 40,000-plus installs this year should come from our internal sales group, so it has nothing to do with door-to-door.
I ran a door-to-door marketing company in the pest control world before getting involved in the alarm business. I worked with Terminix International, Pied Piper, Truly Nolan, big regional players, and obviously Terminix is a huge national company. We would literally go out and create customers in markets. They either wanted to create a new branch, expand a branch or region. I’d hire the people and even though it’s door-to-door our approach was very technical and targeted. We did that for about eight years and in that time frame we were paying attention to Brinks who I think was the instigator of mass marketing the security offering by bringing in a lower money-down up front, or no money-down and higher monitoring.
We paid attention to that and it got to the point where we said we can actually sell that product door-to-door. In 1999 it was our first step into the business and we started as a dealer of Protection 1. They fumbled right about then, they had some major financial problems. They were running a little too loose. We then switched to ADT. Our first year, 1999, I think we installed 900 total systems. We switched to ADT again as a dealer and worked with them for several years. They were great. We went to 2,000 and then 7,000 and then 12,000 installs in consecutive years, just on a summer basis. We felt we got pretty dang good at acquiring customers and also installations. Tyco had some issues and the dealer program at ADT slowed down quite a bit so we switched to Monitronics. We continued our growth and by the summer of 2005 I think we installed about 44,000 systems under Monitronics.
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