SoundThinking, Inc. (SSTI) Earnings Call Transcript & Summary

Good afternoon, and thank you for joining our 2021 Investor Analyst Meeting. Very grateful that so many of you are able to participate in today's session. So let's go ahead and get started as we have a lot of material to share with you today, and we want to make sure that we leave ample time for some post presentation Q&A. We'll just ask people to hold their questions for the moment. There's a chat tool that you can use to put in a question, and then we'll plan on answering your questions toward the end of the session. But first, let's take a moment to legal disclaimers. This is a very important contribution from our outside counsel, so just take a moment to take a look at this. You that I have not met, my name is Ralph Clark, and I'm the President and CEO of ShotSpotter. For today's agenda, our view and introduction of what we believe to be a compelling story of ShotSpotter. Sam will then walk you through our precision policing platform strategy, along with what we believe to be a very large TAM extension in the possibility that, that TAM extension represents. Regan will then share what we believe to be our unique superpower as a company, which is our customer success initiative. Dan will then cover Leeds. And then we'll close with a demonstration of our soon to be released case management solution. Before we take your questions at the end. So since our founding 25 years ago, ShotSpotter was and continues to be a purpose-built company. We're successful because we saw the significant societal problem, which is nothing less than helping transform how policing is done in our society. This has been a large hot button issue over the past 12 to 18 months given the [indiscernible] incident. And while policing reform has been a topic for decades, there's definitely more focused attention and intention being paid by elected officials, policymakers, appropriators, police and, most importantly, the communities that police are meant to serve and protect. You're going to hear over the next 2 days how ShotSpotter tools are helping police be more proactive in addressing, preventing and resolving crime. Simply put, our tools help police do their jobs better, leading to positive public safety outcomes while improving trust between police and the communities that they serve. Let me first just spend a quick moment just sharing with you some outlines from 2020, which was proven to be a very challenging year for many of us, both professionally as well as personally. One of the things that I appreciate about our company culture is that we tend to view things through the lens of possibilities. Some refer to this as a growth mindset. No matter the definition, we can certainly say that we grew and learned a lot about ourselves as an organization as well as the markets that we serve. A few observations. We saw a massive return on the investment we made in infrastructure resiliency, which proved to be invaluable as we pivoted to 100% work from home in order to optimize the health and welfare of our colleagues. And with respect to customers, we've always had the notion that we have built a customer -- we have built-in customer loyalty, but we are frankly surprised that those bonds were deeper and stronger than we had even given ourselves credit for. And I'm extremely proud of the fact that as a company, we continue to find a way to innovate and move forward, including successfully launching several external and internal software releases, capped with our acquisition of the Leeds business late last year. And despite all the bearish news about municipal budgets, we saw and are seeing significant federal stimulus dollars being targeted toward municipalities. Suffice it to say that we not only survived in 2020, but to a large extent, we even thrived, and we're very excited about our future. So what does our future hold? Sam is going to walk through some of the details around our precision policing platform. So I'll just introduce the strategy idea, which is that we're essentially transforming our business from a domestic acoustic gunshot detection company selling to local police departments, to a global precision policing platform company selling to a broader set of customers beyond local police departments. With the addition of ShotSpotter Connect, our patrol management solution, and soon to be released ShotSpotter Investigate, we now have significantly broadened our solution set and our ability to have positive impact on improving policing and the public safety outcomes that result when policing is done efficiently and effectively. The evolution is very similar to the one we undertook 10 years ago when we pivoted to 100% managed services subscription-based business model with the introduction of the Incident Review Center and the customer success practice. That earlier business model pivot positioned us to be able to aptly execute as a public company, growing top line revenue at 30% CAGR, while growing adjusted EBITDA from a low point of a $4.6 million loss in 2017 to an $11.9 million gain in 4 short years. But we recognize that as yesterday's news and calls for the appropriate response of, yes, that's great, Ralph. That's pretty nice. But what have you done for us lately? Or what -- more importantly, what do you plan to do for us in the future? Well, here's where we're going. We know and understand that setting goals and setting a path to chart a plan to get there is what any successful enterprise must do. And we have done the work to be confident in pursuing our path in our forward journey. So here's what that journey looks like. Our intention, our goal is to double our revenues while quadrupling our nominal adjusted EBITDA by year-end 2026. This represents a forward CAGR of 15% and ending adjusted EBITDA margin of 45%. We believe this opportunity is reflective of our large and underpenetrated market opportunity and our strong operational leverage and business model framework. The revenue growth path is about continued execution with our core acoustic gunshot detection franchise, complemented by the diverse revenue opportunities beyond our core. Whereas 95 -- 97 -- excuse me, 97% of our revenue as of 2020 was domestic gunshot detection that was primarily sold to local police customers, with 3% representing other, we believe our broader platform strategy will drive revenue outside of our core to over 30% by 2026. So how would I describe or summarize our growth strategy? It can be summarized really as durable. We love this new monic. We start by intimately discovering and understanding our customers' needs and then positioning our unique offerings where there is a strong need and product fit. We build loyalty into our process to ensure retention. As a result, we gain more share of wallet as customers expand coverage and add our other solutions. Our success is based on our customers' success. And our collective customer success initiatives are a catalyst to reaching the tipping point where our solution set is adopted as a standard of care solution along the lines of a nonlethal or body-worn cameras. When we do our jobs well, our clients improve public safety outcomes and then become promoters to other agencies, which lower our customer discovery and creation cost, which then drives more customer adoption and company profitability. We're creating a virtuous cycle of doing well while we're doing good. And with that, I'm going to turn it over to Sam. You ready?

Ready. Can you hear me?

Yes. Okay. Signing off -- or muting, I should say.

Okay. Alan, can you move to the next slide, please? Hi, everybody. I'm Sam Klepper. And for the last 3 years, I've had the incredible opportunity to lead up our lead gen, sales enablement, PR and product management teams. And I'm going to take you through the environment law enforcement and communities are facing right now when it comes to public safety, the challenges that it's created and how our new precision policing platform provides significant benefits for both groups. I'm going to also revisit how the TAM has grown and the strategy shift we're making in the lead gen part of our department. So what's our precision platform -- policing platform all about? Next? To understand, you really have to first understand what life is like now in the policing profession. Law enforcement is being challenged in unprecedented ways. Last year, whether you're a street cop or the chief, you had to deal with COVID and defund the police movement, rise in crime and a politically divided country, a lot of experienced cops just called it quits. It's just too much to deal with. And it's a double whammy because it's now very difficult to attract new recruits to the profession. And this is all against the backdrop of years of budget cuts and technology getting outdated at many agencies and the resolves that chiefs and agencies feel underequipped and overburdened. Next? At the same time, the community's point of view is that they're being overpoliced and underserved. Their confidence in the police is measured by this Gallup Poll hit a 25-year low. This past year, falling below 50% for the first time. Next? Even before COVID and social unrest, there was a growing public safety gap, where police found it challenging to perform their duty. And many socially economically disadvantaged communities were being unintentionally underserved and overpoliced, leading to distrust of the police. And this has been driven primarily by a data gap, where, for example, 80% of gunfires -- gunfire are never reported to police. So police aren't aware and can't respond to help a gunshot wound victim, for example. And on the investigative side, there's siloed data in multiple sources. And a lack of analytical and collaboration tools has contributed to low clearance rates, which is a measure of crime solved by the police. Only 45% of violent crimes are cleared, meaning more than half of the cases, there's no resolution for the victims or their families, and serial offenders can continue to commit crimes without consequences. And for patrol officers whose role is to be on patrol to prevent crime when they're not responding to a call for service, they're either using their gut to determine where they patrol or they're dependent on data-driven plans put together by prime analysts. But those plans are not often refreshed for weeks, and these analysts have 9 to 5 hours, Monday through Friday. So the data that these plans are based on gets quickly out of date. And this data-based patrol allocation strategy they use called hot spot policing can lead to overpolicing, and they're subject to unintentional bias. Next. We believe the approach that can help police address these problems is precision policing. Data-driven, analytical and technology-based with the community in mind. This term precision policing is not new to police. We like to call it precision policing 2.0 because we think that technology has progressed to a point where you can have both improved public safety outcomes and minimal community harm because there are protections built right into the modern tools. This helps the police be more precise in their patrols and their responses to crimes and in their investigations. It's like fishing with a spear instead of a net. So with precision policing 2.0, police can more quickly and accurately be informed of gunfire events for a rapid, precise police response that could save a life or find evidence that could catch the criminal. It's where investigators have access to analytical and collaboration tools to more quickly connect the dots and solve the cases. So these offenders do not -- they do have consequences and the families have closure. It's where patrol officers now have, in essence, a 24/7 virtual crime analysts working with them through software, giving them access to automated daily patrol plans that have the latest data and [ address them ] to the areas that are most likely to have crime during their shift, then they can be out there helping to prevent it and have more impact. So the result is communities are served better and trust and confidence improves. Next. ShotSpotter has put the fundamental pieces together for precision policing in our new platform. It's data-driven, uses the data to drive actions that give the police greater impact on crime, while doing so in a way that it's more harmonious with communities in which they serve. With Respond gunshot detection, it's the precise response not having to stop people on the street or knock on doors to find out where the gunshot came from. They go right to the location to aid victims and find evidence. With Investigate and case management, that's for detectives and their supervisors. It's getting all the relevant case data in 1 place rather than in silos and providing the analytical and collaboration tools to solve those cases faster, improving clearance rates, like we've seen with the New York police department that's been using the product for years under a different name. And with Connect, it's daily data that puts these patrol plans together and gets the cops to the right place proactively to deter crime, and it has limits in it to reduce overpolicing and more insight into officer activities so they can be held accountable. All these products work together. They're integrated with each other to maximize impact. Next. So I'm going to address each of these 3 product areas in a little more depth in terms of the challenges and what our solutions do and their impact. In the area of gun violence, we know community members do not call police, primarily because they're afraid of retaliation. But also over time, consistent gun violence with no police response makes it normalized, and people just put their hands up and think nothing can be done about it, and they don't bother calling. That's just the way it is. The other important stat is that studies show that 65% or more of gun violence events are perpetrated by less than 1% of the population. It's really a Pareto's law on steroids. So if the police can respond to gunfire events faster, find the evidence, talk to witnesses who tend to disappear quickly, that can lead them to a suspect and even get a small number of them off the streets. That can make a huge difference in homicides and nonfatal shootings. This is precision policing, being more efficient with the resources you have. Next, please. Most of you are very familiar with our system. Gunshot detection uses acoustic sensors that are placed [ in high ] buildings to listen for loud, impulsive sounds that could be gunfire. And those sounds are run through patented machine classifiers that distinguish the gunfire from nongunfire, with an average accuracy rate of 97% over the past 2 years. The system triangulates in on a precise location. All of this is confirmed by a human review in our Incident Review Center, which gives the opportunity to add important tactical information for officers who are approaching the scene, such as multiple shooters or automatic weapons being used. All of this done in less than 60 seconds. The application, you can see a screenshot here, is available on mobile display terminals in the patrol cars, on smartphones or desktop computers at central dispatch, and there'll be a short demo of the product on day 2 of this. Next, please. You're probably less familiar with our post incident tool, previously called investigator portal. That had a major upgrade. November of 2020, it was renamed ShotSpotter Insight. It's included as part of the response subscription, and it's primarily used by crime analysts and investigators post incident for historical crime trend analysis and for looking at particular incidents as part of investigation. The new version Insight has great tools to make searching faster and easier, analyzing the sequence and the timing of shots in a particular incidence -- incident. It's web-based for easier access. It has overall better performance. And over 90% of agencies have converted to it. So that's a testament to the value of the upgrade and great work by Nasim, who runs our support team, that allows us to sunset investigate portal -- investigator portal next month, which is about a month ahead of schedule. So now let's talk about the impact Respond has had on communities, and we have a short video to show you. Next. Is there a video there? [Presentation]

We hear more and more stories about victims being found when no one calls in and police rendering aid or calling an ambulance that can save a life. You can see results from Respond at different sized cities, different parts of the country and the impact it's made. The system went live in Detroit this month. And you may have heard that within hours, police got an alert to a residential area, where they saw some bullet holes in a car in the yard and were able to obtain a search warrant. And they found a ghost gun manufacturing operation in the middle of this residential area, and they were able to shut it down. So all sorts of different ways to help make a positive difference in the community. Next. Now let's talk about the challenges in investigations. We know every case, every alleged case even, of crime must be documented and reported on in an attempt to solve it. Our research has shown that there are many challenges that detectives and their supervisors face. First of all, many investigative units are overrun with cases, with officer retirements and resources. This is contrast against the rising crime at the same time. So they're -- it's getting worse. They're getting frustrated with the fact that case information is spread out over a number of different places. And they're using a mix of tools to manage their cases. They're manual, Excel-type approaches, spreadsheets, homegrown systems and limited functioning -- functionality record management system modules. And it makes things very time consuming. And there's no real -- in many agencies, there's not a standard for step A, B, C, D in investigative process. Supervisors often have little insight into which cases are getting colder and which ones need attention, unless they're physically there talking to the detectives. And they're unaware when something relevant happens, in other cases, that could be linked to the case they're working on. So we see a huge opportunity to bring automation to this part of the crime workflow and speed the solvability and close more cases. Next. ShotSpotter Investigate is that tool. This was acquired from Leeds, and it was known as CrimeCenter. Our view is that it's the most comprehensive case management system out there, and it's been proven -- used by New York Police Department over many years. It's made investigators more efficient and effective, and you'll be seeing a demo of it shortly. Next. Next. In NYPD, it's contributed to a 9% increase in clearance rates on homicides. So when you compare the clearance rate 5 years before using the tool and 5 years after, that's the kind of impact it's contributed to. And the most recent next -- the most recent 5 years, NYPD has had a 19% higher clearance rate than the national average according to FBI stats. Next. When looking at patrolling, there's less cops available with less time to patrol since crime has been going up and they're responding to calls. So they have to be ultra efficient and effective. They're spending the majority of their time responding to calls, but when they're not, there is an opportunity to deter crime simply by their visible presence. Patrolling has been studied a lot, and this Koper Theory shows that a small amount of visible police presence can have lasting deterrent effects. You also need to take into account, you don't want to patrol the same old areas because they might not be at risk for crime that day, and you also don't want to overpolice. So data-driven patrolling versus gut-based can get cops to the right place at the right time to prevent crime and in a way that minimizes unintentional bias. Next. You'll see a demo of the product on Thursday to really understand how it works. But at a high level, you can see boxes that are color-coded by crime type that show the cops where they need to go to patrol during their shift and what crimes to be on the lookout for. The system recommends light touch, nonenforcement tactics such as a visible drive-through, foot patrol, visiting businesses and doing a safety check to see how things are going or simply parking and doing paperwork. This is the first system to incorporate civil liberties protection, and we hear from customers that the level of the information that the system provides on officer activities in the field lets them test new patrol strategies and see their impact. And as a result, we're seeing strong momentum on the product this year. Next. So how well does Connect help agencies protect their communities? This is a snapshot of a presentation by the Greensboro Police Department after a 90-day pilot of an early version of Connect when it was called HunchLab. Connect was deployed in one of their districts where half of the squads use Connect and the others did not. And at the end of the pilot, the squads using Connect drove Part 1 crimes, which is violent crime and property crime, down by 33% versus the control group. Next. Next. Temple University conducted a test in Philadelphia where they saw a similar drop. This was specifically in property crime in areas where they use the software relative to areas that did not use the software. Next. And this year -- or I should say, in 2020, this is an example of impact on violent crime from one of our East Coast agencies. And that vertical red line represents when the training was implemented and you start immediately seeing a drop in the top red line, horizontal red line, in violent crime where high dosage patrolling was applied to this agency and they visited those boxes compared to lower doses. If you look at the bottom, they're basically -- the green line is basically flat with even an upward tick, and the middle kind of bluish line saw a drop but not quite as significant. So this client continues to experiment to optimize their patrol strategies with this tool. And for example, in January and February of this year, they tested turning on blue lights at the end of their cruisers when they're patrolling. Lights aren't flashing. They're just a way to be a little more visible. And then they even added some more staff to visit the directed patrol areas. And in this time period of January and February, they saw a 31% drop in Part 1 crimes versus the prior year. Next. So if you look at our precision policing platform as a whole, Respond helps to detect gun violence and create a rapid response by police to render aid to victims, potentially save lives as well as collect critical evidence that's used by Investigate to solve cases and improve clearance rates, get those offenders off the street and reduce crime. And with Connect, next, we have patrol officers better able to prevent crime, which is really the most efficient and effective way to lead to healthier communities. Next. We see our end-to-end platform more than doubling our market size from about $1 billion to over $2 billion. In the newest area, investigations, we see $0.5 billion of new TAM with the acquisition of this product. All agencies have to investigate and document cases. They're already doing it. And we think we found a gem with what Leeds has created. We're going to run it through our sales and marketing, and it's something we can sell to thousands of agencies. We're not limited to those that only have gun violence because it tackles all cases, all types of crime. It opens us up to serve state and federal agencies, which we're already having discussions with. And down the road, we see international opportunities and even commercial applications as corporations and universities are required to investigate and report on crime. Our Respond market opportunity has increased by about $0.5 billion, given the success of our program to open up nearly 1,000 additional smaller agencies that have populations under 50,000. These are agencies we did not attempt to serve in a proactive way in the past. Cities like Kankakee, Illinois or Monroe, Louisiana. They like having a big city tool. And we bundle things together to make it more affordable, ahead of focused sales and marketing effort, and we're seeing success and momentum in that part of the market. While in Latin America, our focus areas have unfortunately been hard hit by COVID, but we still see a huge opportunity there. We've also added in TAM because we're starting to sell gunshot detection under the site [ Secure Brand ] to private companies. Violence around commercial businesses has always been there. We're seeing, however, recently, a 40% increase in violent crime, most of it in the parking lots of retail establishments. And corporate entities are depending less on law enforcement and taking more responsibility for the safety of their employee and customers, whether it has to do with persistent neighborhood gun violence or mass shootings. And patrol management is a category we're forging. We do see it as a smaller market relative to the others. But as we've recently had larger agencies adopted, we're more bullish on a higher ASP. It's certainly a great upsell to our current customers, but we've also just now started selling beyond our installed base. And we see that as a way to start a relationship with a new agency. And again, it doesn't require them to have a gun violence problem. Next. Now we're going to turn to lead generation. We started the program in 2019 to deliver high-quality leads to the sales team. And despite in 2020, a couple of months where no agency would take our call, there were no events, we did see significant improvements across the board in getting more leads, more meetings set and more opportunities. Very importantly, our conversion rate from meetings that convert into opportunities increased from 40% to 60%. And that resulted in a 145% increase in the number of opportunities and a 31% increase in the total ARR pipeline that was added. We have a very good partnership with a sales team, and we try to keep them busy. Next. As we thought about our lead gen strategy for 2021, we look back at 2020 and the mix of meetings that occurred across Respond versus our Security business, which were the only 2 products we focused on from a lead gen standpoint. And not surprisingly, Respond received a dominant share of the meetings and the ARR pipeline add. Next. As we look at 2021, we're going to redirect marketing time and spend to juice up the pipeline in the other areas of our precision policing platform, Connect, Investigate as well as Security. We're still beginning to do campaigns on Respond, but we have the brand awareness and the critical mass of net promoters to drive word-of-mouth and inbound inquiries for that product. Next. Here are 2 examples of some upcoming campaigns. The first one is based on the $1.9 trillion American Rescue Plan. Approximately $130 billion is going to states and cities and counties in our target market, and those dollars are all eligible for ShotSpotter products. Money is being sent to the cities, and the police must request it. So we have templates in this campaign to help them request the money and a grant expert available as well for consultation. We're happy to provide that, but they first, of course, must schedule a meeting with us and learn a bit more about our products. We'll be using this for both Respond and Connect. Respond, those will be the higher homicide cities versus the Connect cities. And the themes around being a hero to the community, helping them get money to support the community objectives. On the right-hand side, you'll see a retail program. We did announce today a retail program for Security that are -- that's targeted at the retail sector. Many areas of retail have done well during the pandemic, and we're targeting those areas. These are areas where neighborhood gun violence and active shooters are always a threat. As unfortunately, we saw last week in Boulder when a gunman opened fire on people in a parking lot of a grocery store, and it took several minutes for police dispatch to become aware and to know where to send cars. The trend I mentioned earlier in retail violence, there's been a 40% increase in violent events. And we're partnering with The Loss Prevention Foundation that is a retail association. And part of its charter is protecting retail stores. And we have a webinar coming up in April that will give continuing education credits to those attendees. We're going to talk about how the technology can strengthen their partnership with local law enforcement. And for many small -- or for many retail chains, we have overlapping coverage with our Respond product. And so some of the -- for some of the stores, we can go into a sales presentation with data, join shooting incidents and rounds fired near some of their stores, which is usually a very compelling way to start a conversation, because they're usually completely unaware of that. Next. I'm going to finish with a really interesting part of my job, which is to try to figure out where the market is going and anticipate opportunities and threats. And back in 2019, I spoke with Ralph about the increasing influence of the community on law enforcement purchase decisions and the growing threat of new privacy laws that could be sales blockers as some members of the public thought our sensors were listening to conversations, which is not the case. So we mobilized to proactively reassess and enhance our privacy protections. We commissioned a third-party audit. Next. And there was an [indiscernible] practice. And sure enough, a handful of cities have been passing into law, local ordinances that require a rigorous review of law enforcement technology, whether it's in place or being considered for purchase. Anything that would be considered a surveillance product. And with these protections in place and [indiscernible] in hand, we were able to successfully navigate the Oakland Privacy Commission process with a unanimous approval. That was back in 2019. We've received some fairly good publicity from it, as you can see on the left. And more and more cities are instituting these types of laws or review boards such as Detroit and St. Louis and New York, but we feel we're fully prepared to handle these. On the Connect side of the business, we anticipated some scrutiny, less so on the privacy side, but more on the potential buy side, as to where the system would direct patrols. But again, we have built-in protections in the product for the community, which our Head of Technology, Paul Ames, will go over in our second session. These efforts have created not only differentiation for us, but it's removed a potential sales obstacle. So that wraps up my section, and I'd like to introduce our Head of Customer Success, Regan Davis.

Thank you, Sam. I am really excited to be here today to talk with all of you about what we're doing with customer success. So there's no question that ShotSpotter technology is extremely powerful. You just heard a lot of that based on what Sam had to say. However, really, our technology is only as good as our customers deploy best practices. So Ralph talked about our secret sauce. Our superpower, secret sauce, if you will, is really having a very robust customer success team. And that team is 100% focused on helping customers adopt best practices to ensure their success. So to that end, our customer success mission is to ensure that every ShotSpotter customer maximizes the value of ShotSpotter's public safety and security solutions. So I want to talk a little bit about the team. We continue to expand the customer success organization. We have a group of customer success directors that have a very long history of law enforcement experience. And almost all of them were customers of ShotSpotter prior to joining the company. So they really have that customer perspective and understand what it takes to be successful. And most of these folks were very high-level executives within their organizations. And we have a good mix of both federal and local. It really helps us to understand how the 2 can work together and be much more collaborative and successful. We've also added a couple of subject matter experts. As you heard Sam, we are expanding our product portfolio. So we've begun to add subject matter experts to really make sure that we're doing well by our customers with these new products. We have someone who is very familiar with managing patrols and directed patrols, who will be managing our Connect product, which you heard a little bit about, and you'll be seeing the more in-depth demo on Thursday. As well as an expert in our Investigate product that will be coming out a little bit later, the whole case management that will be coming out later this year, and you'll be hearing more about that today. On the team, we also have 2 expert crime analysts with a long history of experience as analysts and intelligence officers in the law enforcement community. These 2 really help our customers understand best practices in tracking their successes and conveying the key results and outcomes based on both their own ground truth data as well as a lot of powerful data that comes out of the ShotSpotter platform. So next, I want to talk a little bit about our view on maximizing lifetime value. The first key here is onboarding. Studies have shown over and over that the most critical component to maximizing lifetime value is how well you manage your onboarding process. So we take this very seriously. We work closely with our customers to develop a customized strategy and program design that best suits for them. But it's really leveraging a lot of the experience that we have after having worked with over 130 customers. Then we go into training. And we not only do application training to make sure everyone understands how to use our tools, but we also do a deep dive on best practice training to make sure that they really understand how to get the maximum value. As I mentioned before, really, our technology is only as good as our customers adopt those best practices. Once we have all of that done, then we launch and go live with them. The next phase is really the value realization piece. We truly see our customers as partners. So we are not in the mode of mega sales, get them trained and off you go. We really work -- continue to work closely with our customers. We've developed a customer health score that considers multiple inputs to help us really keep a pulse on how our customer is doing. We track both application and best practice adoption and continue to provide training wherever is needed. And this is really something that is ongoing because we see a lot of movement within police departments folks get promoted, they have new staff coming on board, staff need to go to other departments. So this is something that we continuously do. One of the things that we have also really focused on is, how do we facilitate cross customer communication, collaboration and sharing of best practices? This is really about cops talking to cops or college campus security talking to college campus security. Prior to COVID, we often hosted regional meetings where police departments could come together and talk about what was working well with them and ask questions of their peers from other departments. In 2021, we're really looking at how we can better leverage online tools and really, not only because of the pandemic, but also in order to just be able to scale our business and really increase the amount of cross communication between our customers. Again, this is a very well-known best practice within the customer success community. Then lastly, we do an annual account review that includes an in-depth value report. We just dive into successes and outcomes as well as opportunities where we feel like there could be improvement and ways for them to increase their success. We also spend a lot of time talking about, what are your priorities? Where are they headed? Do they have any organizational changes coming down the pipe? Do they -- are they planning on introducing any new technologies? We're really trying to understand the context within which our technology is being deployed. That's how we can be a true partner and really better serve them so that we understand that overall context. And I'm going to dive a little bit deeper in the next few slides just to give you a few slides out of our value report so that you get a better idea of what that looks like. Our next phase is the expansion phase. Because we spend so much time with our customers and we drive success, that often leads to them wanting to expand their coverage. So we treat them very much like we did when they first came on board. We get back into market, and we make sure anyone who is new to the technology because they haven't had it in their beat or their district before, we get in, make sure that they understand the application, but that they also really understand those best practices. And once we go back through that, then we launch them and off they go. So this is just an example from a slide from one of our actual value reports. This first one is really -- it illustrates a very consistent pattern, which Sam mentioned, which is that many times, the community does not call 911 to report a gunshot. He mentioned there's a lot of reasons for this. First of all, many people don't want a police officer showing up to their home either because of immigration status or other concerns. They might not want someone else in the neighborhood knowing that they were the ones who called the police. And unfortunately, in some of our communities, gun violence is so prevalent, they just become numb, and they just stop calling altogether. So it's really sad. In this particular instance, only 1.2% of the time was there a 911 call within the first 3 minutes. Now it's true, we often look at what happens in 15 minutes, and you might see actually even a doubling of the number of calls in that first 15 minutes. So instead of 1.2%, you might be hitting 3%, 4%, but still, the vast majority of the areas that we cover, between 80% and 90% of gunshots do not have a corresponding 911 call. And a lot can happen between that 3-minute mark and that 15-minute mark. A victim can be bleeding out. We find that both victims and perpetrators flee the scene. So it really does make a big difference when you've got an alert that you can respond to immediately. This is the one that I personally and I'm sure that many in our company feel is probably the most valuable piece of our software, which is identifying and finding victims. For this particular customer, in a year time period, they were able to identify or find 96 victims based on ShotSpotter alerts alone. They would not have known about these people if they hadn't. This customer also told us a really heart wrenching story. Just about 2 weeks ago, a 17-year-old boy was shot in the chest. Police dispatched because they have the application available in their patrol cars. They self-dispatched and arrived on the scene between 3 and 4 minutes. They were able to give immediate first aid and call for medical backup and get him to a hospital very quickly. The surgeon later reached out and said if they had not responded in that kind of time frame, there is no question that, that boy would have died. So -- and this is a story we hear consistently across our customer base. You've heard it in the video where we have the community and their feedback. So this really, to me, shows how critical this technology is to the local communities. The other thing that's really important and a major benefit of the technology is because our technology pinpoints the exact location of an incident, patrol officers are able to get to the exact location and they find significantly more shell casing and, frankly, other evidence as well. For this particular customer, they were able to find 73% more shell casings with ShotSpotter alerts versus just the plain vanilla 911 call, where about 27% of the time they could find those casings. Because, remember, a 911 call is, I heard something in my neighborhood, it might be 3 blocks away, it might be a mile away. So the chances of being able to find evidence goes way down. That exact evidence collection is really what leads to a much increased level of being able to find and seize guns. In this particular customer's case, over a year period, they were able to find 85 guns and get them off the street. Okay. I'm going to shift gears now and talk a little bit about what we're doing as an organization to improve our efficiencies and to be able to scale our business. In 2020, ShotSpotter adopted a customer success platform from Strikedeck. It has all of our customer information included in one spot, so it's easy to see, but it's really helped our internal efficiencies by having internal collaboration and ensuring consistency from customer to customer by leveraging playbooks, and it's helping us with internal efficiencies by being able to automate certain reports and internal communications. So it really has gone a long way to improving our ability to manage customers, communicate internally and become far more efficient. And as we add more products to the product line, being able to build out additional playbooks around each of those really helps us be able to scale that business, and having a single view of a customer across all of our product lines is going to be invaluable. One of the things I wanted to touch on. Because we feel that customer success is such a critical component of our business, we are looking to continue staff development here. We're planning an in-depth training, in-person training later this year that's going to be focused on consulting -- consultative frameworks and best practices, really honing in on change management within our customers' organizations: to change their processes to adopt our applications, to change their processes to adopt our best practices around using those applications. And of course, we'll continue to stay focused on key customer success skills that all SaaS customer success teams are very focused on around problem solving, relationship management, empathy. Empathy has always been critical in customer success but never more so than it has been over this past year. And we know that this is going to be very critical moving forward at least in the years to come. And then, of course, focusing on expectation management and excellent communication. Lastly, I want to talk a little bit about our NPS and how we use NPS. I'm sure most people are familiar, NPS stands for Net Promoter Score. It is a customer success gold standard in the industry for any company that has a SaaS technology or platform. It's a quantitative measurement of really basically how our customers view us. And this has a significant impact on our ability to manage renewals. It helps us in identifying who would be a great reference for us or potentially provide us with testimonials. But it also helps us identify areas where we need improvement, whether it's in our service, our support, our platform, and that's invaluable to understand where we have new opportunities. We believe so strongly in NPS, we actually have a company-wide bonus tied to our NPS results. So everyone in the company, not just customer success, is very focused on our customer satisfaction. I wanted to share the trends we're seeing in our Net Promoter Score. So I am very pleased to say that ShotSpotter has been consistently high in scores even in the very beginning. With a score of 30 -- those of you who are not familiar with NPS, a score of 30 to 69 is good, very good. Anything above 70 is excellent. So ShotSpotter truly has been strong all along, and we've really continued to grow in our Net Promoter Score and feedback. So I think this is a real positive, and it's a real testament to what we do with our customers and how we treat them as partners. So this is just a couple. There were many, many comments that came back and feedback that we got, but I wanted to share just a few of these. So ShotSpotter performs above promised performance levels. They've been extremely impressed and happy with our partnership. They see it as -- the thing that's most important to me that it increases their ability to respond to violent crime in a more timely manner. Those are things that are all really critical and aligned with what we see as the value of the product. And lastly, I wanted to show sort of an overview, an executive summary of our Net Promoter Score. This is at a very high level. 96% of our customers indicated that they're likely to renew, which is a really strong indication of the health of the business. And then one of the aspects of our business really is helping our customers do a better job of improving community relationships in their area. And 70% of our customers feel that we help them improve those relationships, and I think that's really critical. As I've mentioned multiple times before, we feel strongly that our customers are our partners, and our NPS results truly reflects that. 97% of our customers see ShotSpotter as a true partner. And lastly, our customer service, which you'll be hearing more about this week, on Thursday, we see very strong satisfaction rates with our customer service as well. So these are just some of the key highlights from the NPS. So that's really all I have for today. And so now I'd like to turn it over to our newest colleague, Dan.

Thank you, Regan. Good afternoon, everyone. My name is Dan Leston, and I'm the Managing Director of Leeds operations. I'm sure you're aware of the acquisition of Leeds by ShotSpotter, and my responsibility is managing the professional services and software development for Leeds. A little bit about myself. Managing Director of Leeds. Over 2 decades of design, developing and supporting mission-critical systems for the NYPD. I started at the NYPD as a senior developer. And over the years, that relationship has grown and grown and grown, where today, I'm a senior engagement manager, overseeing the professional services and support services that we provide to the NYPD. I'm a trusted partner to the NYPD to deliver records management and case management solutions. Worked very closely with their executives. We gather their requirements. We provide design services and development services to build large-scale applications for the NYPD. We help them strategize and plan for the future. And we help them improve our support services and their own support services through our help in their training and understanding our technology a whole lot better. Former managing partner of Leeds, LLC, before the merger with ShotSpotter, and I have over 30 years' experience in IT. A little bit about Leeds. We were formed in 2010 as a dedicated team of 16 members to develop and support mission-critical systems for the NYPD. And today, the Leeds team is approximately 30 dedicated members dedicated specifically to the NYPD. In 2010, we also formed a separate part of the company to [ devote ] themselves to developing a suite of law enforcement applications for other agencies. Since -- prior to 2,000, we learned a lot about law enforcement working for the NYPD. Several of my current employees, team members worked with me at the NYPD, and our experience there was 15 to 20 years working with them, and we use that experience to build the CrimeCenter application, which you're going to hear a lot more about, which today we call ShotSpotter Investigate. In 2014, we completed our records management and case management applications and till today, we continued to improve it and build upon it. And now you'll hear more about what we're doing under the ShotSpotter. At NYPD, our -- I like -- we fall under mission-critical systems. We design, develop and support several systems for the NYPD. There are -- in 2 categories, records management and case management and a few other outliers where -- I'll explain that. But under records management, we provide the systems and, most importantly, over the past recent years, we've consolidated that under our services and under one technology stack. And just some examples of records management, arrest processing, which is probably our #1 priority at the NYPD to maintain arrest processing; complaint processing; juvenile apprehensions; domestic violence; sex offender registry; all sorts of moving violations, motor vehicle violations; criminal summonses; civil summonses; use of force; field investigations; and a whole lot more under records management system. After 911, we provide the most critical systems to the NYPD. The second bullet I have, arraignment and prisoner management, which kind of falls under arrest processing, is very important to the NYPD. They've got the requirement to process an apprehension within 24 hours from what we call A to A, arrest to arraignment. So there are several parts of our records management and case management systems, which manage that whole process, where is the prisoner, what's the next step in the arraignment process, where are the -- where is the information from the district attorney, where is our information going to the district attorney? So it's a highly integrated system within the NYPD and with other agencies to manage the arrest to arraignment process, very important. Case management has become our #1 or our biggest applications at the NYPD and, obviously, has grown into Investigate now. Case management started off as a temporary stop gap for the NYPD in 2005, where I met several of my NYPD colleagues that work with us today, namely Jim Belrose, which you'll meet next. But it was a temporary solution that we provided in 2005, and it grew to become what we know as their enterprise case management system today. It covers all the criminal side, and it covers many other areas outside of the criminal side, including internal affairs, legal bureau and other bureaus that use our technology. Messaging systems, which is interesting, go along with our records management and case management system solutions. Within the NYPD, we need to message to other applications or other assistance that they have. But more importantly, we interface with external agencies, both local New York City and New York State. For an example, an arrest is made, we're transferring that information to our fingerprint systems, we're transferring it back to New York State for NCIC checks, and we come back to the system to clear the prisoner for the next step in the arraignment process. In terms of case management systems, especially most recently with the discovery [ legislation case ] folders throughout the day, up to thousands of case folders to prosecution since they have got a mandate to get that investigation electronically in the hands of the defense within 15 days. Another part of our records management system we don't talk much about, but it's a very, very big system, and it was the first mobile application the NYPD rolled out, the citywide towing operations. It's a very big system for the NYPD. It handles all their towing, and it handles what we call the relocation. It handles their release of vehicles back to public and actually manages their payment process. Something that's been very important especially recently has been police activity monitoring systems. This falls into where we use our case management technology in different areas, not just investigations, but to manage police incidents or officer incidents, manage personnel systems and resource allocation systems. So through these monitoring systems, we've recently been able to help the NYPD publish police information to the public, so they can look up a police officer, find out their history, both good and bad. Command management systems, at the same time, work alongside with our personnel systems and resource allocation systems, help NYPD organize their organizational structure and handle such things as minimum and maximum manning power, facility management and things like that, so that all these systems and all other systems at the NYPD have a centralized place to find out about personnel and resource allocations. Lastly, property and evidence system, tightly integrated with our case management and records management system, is replacing a very outdated property and evidence management system at the NYPD. These are just some of the most important mission-critical systems that we have designed, developed and continue to support at the NYPD. Our services there I break up into support and what we call SEC, or scheduled enhancements and customizations. Our support services are critical to the NYPD. We provide 24x7 production support and system monitoring. So you'll see a little screenshot at the right there. We're constantly monitoring all our applications, all our servers, all the communications across all the agencies to make sure that arrest processing is 99.9% up. We provide help desk support level 2. We take on approximately 250 calls per month, sometimes upwards of 300 to address certain things like break/fix, assisting users and taking on suggestions for minor enhancements. In terms of minor enhancements, we take on approximately 10 to 15, and they help the NYPD do things such as bail reform, which was very important in 2020. We had to modify and upgrade all our systems to manage the bail reform changes that we created a whole different workflow for the NYPD with respect to arraignment. Discovery legislation, I mentioned before, is another example of what we can do on the support services, where there was a mandate for the NYPD to deliver electronic records, both from case management and records management system over to the prosecution within minutes after an arrest. Disciplinary actions as well, during this past year, we've been very busy creating the personnel systems and disciplinary action databases that we manage. Scheduled enhancements and customizations are more large scale, typically strategized with the NYPD from year to year. We approximately complete 5 to 6 major enhancements, which include new systems or major enhancements to our records management systems and case management-related systems. Finally, our CrimeCenter operation, which is now called Investigate, is something I manage. It's a dedicated team of senior engineers, developers and subject matter experts from the NYPD who work for us, work with us and focus on the design and development of case management solutions. We're currently transitioning Leeds CrimeCenter to ShotSpotter Investigate and when -- after -- before the acquisition, one of the things I realized is that ShotSpotter would enhance our expertise, our resources and market opportunities to expand and grow our case management solution. We're in currently what I call our Phase I. We're rebranding the CrimeCenter Software as ShotSpotter Investigate. You'll see a demonstration of that next. We're migrating our services from Microsoft Azure, which was Leeds provider, and we're moving over to AWS. We're completing the development of the property and evidence module, and we're designing the integration with ShotSpotter Respond. And we'll be ready for market by Q3 of 2021. Well, that's it from my slides. I'd like to introduce Jimmy Belrose, our Client Engagement Manager, and he's going to provide a demonstration of case management -- investigate case management. Thank you.

Good morning. My name is Jimmy Belrose. I'm a member of ShotSpotter solutions group. I have 22 years of law enforcement experience with the NYPD. I served various roles in commands such as with Transit Bureau, Housing Bureau and Detective Bureau. After retiring from the Forensic Investigations Division as a Lieutenant Commander, I joined CrimeCenter Software as a client engagement manager, where I served for 4 years prior to the ShotSpotter acquisition. I bring professional, management and investigative experiences to ShotSpotter to make Investigate a premier application that will best serve the needs of our customers. Today, I'll be providing a demo of ShotSpotter's new application called Investigate. But first, what is Investigate and what does it do for law enforcement agencies? ShotSpotter Investigate is a complete case management solution that enables investigators to work a case from crime scene through conviction. Investigators use purpose-built digital case folders with configurable workflows to capture, organize and maintain all investigative documents and multimedia associated with their cases. Analytics and reporting tools provide insight into cross-case relationships and enable supervisors and executives to better understand and direct investigative resources. Advanced collaboration tools bring patrol, investigators, supervisors, prosecutors and the public together to exchange information to solve cases faster and improve clearance rates. This builds community trust in the police while increasing the safety and security of the public. Investigate does all this in a cloud environment that is fully mobile-ready, allowing investigators to maintain their effectiveness and stay connected to their cases, whether they're in the office or in the field. Other case management systems such as paper-based, homegrown and add-ons to RMS fall short in providing the complete case management features found in Investigate that are necessary to successfully investigate and clear cases. To start, I will take you through the application as an investigator would, from access to the main menu and homepage. This is where the investigator will sign on and be taken to their homepage. The homepage is configured of widgets. Each widget can be resized and moved and even removed. We have a list of widgets that can be added and additional widgets can be made if needed. The main menu is broken down by modules, interactions, allows you to interact with the community and with other members of the agency through supplying tips received from the public, field intelligence reports received from offices in the field and citizen submissions from the citizens portal, which we'll go over later. The incident report menu is where you create your criminal incidents, log in arrests. Investigations menu is where you do criminal investigations and you can transfer and close investigations and where your pending investigation queue is, where all matters are sent for review and determination if an investigation is warranted. The same with intelligence. We have an intelligence queue, active cases and intelligence compliance review tab, which maintains a code of federal regulations compliance, 28 CFR Part 23, and you can also manage [ gang and ] confidential informants. And we also have integrity, where we can manage use of force, internal affairs, personnel and equipment. And then we have an analytics and reporting menu, where we can do operational reports and dashboards, and we can do public record searches. Now I'll take you through the application and some of its features and capabilities. For this, I would like you to imagine that you are an investigator. Somewhere in your agency's jurisdiction, there is a ShotSpotter alert and patrol is notified of the event through the Respond app. Simultaneously, Investigate is also notified of the incident and will automatically create a ShotSpotter investigation report. Detectives will receive a notification of the incident. They will be able to review it, create a case folder and respond to the scene. This is where the investigation begins and case management comes to life. So the investigator would have already created an investigation report or completed the investigation report from the appending investigation queue and then assigned it either to himself, ourself or to another investigator in the command. Whoever receive that investigation would receive a notification by text and by e-mail that a folder was created for them. They would go to their active investigation menu. And in this particular case, this is the case folder that was created for me. It's investigate shots fired, ShotSpotter alert 1 of 2020. Inside the case, every investigator receives the same dashboard. It's a visual summary of all of the data that's inside of the case folder, how many supplements were prepared, how many are submitted and not submitted, draft mode and final mode, how many assignments were created that are still overdue, how many were completed and closed, and what are the supplements by type? The investigation chronology screen is where we do a table of contents essentially for the case folder. Someone can come in and look at all the activity that's taken place in the case, logically and in date and time order. In this particular case, we had a criminal case intake that was created by the shots fired. Just to briefly summarize, when we create this document, we will attach to it the wave file or in this case the MP3 file of the gunfire sound that was recorded by the Respond, the acoustic detectors and send to the Respond app and also the geography data, where was it exactly. This is memorialized inside the case folder for the investigator. In this particular case, after the intake was used to seed the case folder, they responded to the scene, they requested crime scene's response and documented it. They interviewed a witness and they recovered video. So from the scene, they were able to create a supplemental, recovered images and attach it. At any time anybody can review this image, this video. And it shows them rolling up on the scene trying to open the door of this car. It wouldn't open. They come over to this car. They try to open it and then he waves the gun around and then he shots to gone off as they're leaving in the car. Since this case has a known perpetrator recorded on video, they can make a wanted poster, which they did. They wind up getting a tip from the public website. So what is the public website? It's a citizens portal that we create automatically for every agency. Anybody in the public domain can go on to the website. They can go view our most wanted, and they can go down, and they can find this wanted poster. They can open it. They can enlarge it. They can print it. They can read the narrative, and they can say, I know who that is, let me submit a tip. They fill this report in, and they send it to us. The benefit is that this report that they send to us, this tip, goes directly into this case folder. And from here, action can be taken on. So this becomes a lead in our case. We have a Leads section. Inside the Leads section, we make assignments. In this particular case, they said they know who that person was. He's a known car thief who sells stolen auto parts, and his name is [ Shorty ]. We assigned -- we created an assignment to an investigator who has a confidential informant that knows about people that steal cars. He interviewed that CI and found out that they know who it is and where he lives. So in the meantime, while this was going on, there was a forensic hit in the case. There was a CVS robbery in the past where a firearm was discharged inside the store. Ballistics in that case match the ballistics in this case. What the investigators were able to do is document their [ confero ] and then create a companion case. The companion case is simply a way you connect 2 cases together, memorialize that in the case folder, and you can also allow the other investigator access your case if necessary. In this case, I have one for the CVS robbery, and I also have one for the crime scene investigation. So I can go in at any time. I can open the crime scene case, and I can view it. I can open up a document inside the case, and I can view the ballistic evidence that they collected and documented. Ultimately, in our case, because of the information received from the confidential informant of where the person may live, and since we had good video, we went out and we did surveillance. The surveillance confirmed what the CI told us and what the video showed us. We requested authorization to get a search warrant, which we were given, and we executed the search warrant. We wound up making an arrest. We documented the evidence that was taken off from the subject who was right there, and we attach a copy of his written confession. What's good about this system is that it doesn't stop with just you having access to your case folder. You can, from within the case folder, publish a case. And the publish is an electronic case for the district attorney. So they receive an electronic file, and it contains an index, and it contains all of the documents that are in the case folder. They can go through this one at a time. They can view it in the same way that we viewed it. They can play them the same way that we play them. So they have everything that the investigator has. They can also, if they're a user of the system, create assignments and request additional information be provided to them. Now I'd like to take you through our link analysis under our analytics section. Link analysis allows you to find connections between as many pieces of information that you have that are known. Like I know about a male white with a tattoo on his right neck, and I also know that I'm looking for information about that person and any relationship it has to the firearm on any documents in our system. And we can go out. We can find that relationship. And what we find is, there is one document where we have somebody with a tattoo on his neck, in this case, all of his neck. And there is a relationship to a firearm in the narrative section. We also have a relationship with the first 2 and [ who's the ] public records. [ Who's the ] public records is another great tool to be able to go out and search by phone number, date of birth, address. And it gives you additional information that you can exploit to locate this person: addresses, phone numbers, relatives. And you can save them or print them. We can also do unit snapshot report as one of our analytic reports. It's a way to look into a work unit. From a top-down approach, look at how many personnel are assigned to the unit, how many active cases that they have, broken down by type and percentage? And then you can look at each individual officer or investigator, what is their case load, how many overdue assignments do they have? You can look at their cases and see how many days since they last had any activity in the case, how many investigative documents are inside of that case. We can do the same thing with our active case load report. This is another report where we can look at how many assignments are inside the case folder and how old are the case folders. We know I have 18 cases that are active, 13 are less than a year old, 5 are more than a year old. It's a way to deal with cold cases. And we also have dashboards. We have a CI profile dashboard. You can look at all CIs in the agency, broken down by type, by status, what work unit has them, how much buy money do they spend, what types of buys do they make, how many debriefings were good? We also have our e-incident dashboard. And the e-incident dashboard will bring everything back from the public portal, and you can look at them and drill down, just show me the criminal incidents. If you had cases created from these criminal incidents, you can go into the case folder itself. And lastly, I'll show you our tips dashboard. These are any tips that were recorded in the system. It's date sensitive, so you enter a date that you want to search. It will go through the system. It will find all tips, break them down by type and category. Again, do some geography with some mapping, tell you the types of tips, percentages. They'll tell you the method that the tip was received. It's a good way to understand what's going on in your command and where those tips were referred to. This is just a small example of the types of reporting and dashboards that we can do based on the large amount of data that we collect at every level, from intake through the investigation. That concludes the demonstration of some of the features and capabilities of the ShotSpotter Investigate. I'll be happy to answer questions during the question-and-answer at the end of the session. Thank you and have a great afternoon.

Great. Thank you, Jimmy. We're going to go back to Slide 1. This is Alan Stewart. Hopefully, everybody can see me. As you can see, we presented a lot of information today. A lot of it about new information that no one has seen before. And hopefully, you found that very, very helpful. We do have several questions. And if you do have additional questions, please feel free to go ahead and answer those. We'll go ahead and start answering some of the questions that we've been asked so far at this point. So I'll read -- what I'll do is I'll read the question and then select our executive that will handle the primary answer. So we'll start with one that was -- one of the earlier ones that was related to Connect. So here's the question. Is there any initial data showing that Connect did not lead to racial bias? What has been the community response? Sam, I'll go ahead and turn that over to you. You have the information about that. And as well, we might share some more information about that tomorrow as well.

Yes. Sure. So we believe with the use of multiple noncrime variables and this allocation engine that we have, you'll hear more about that in the second session, we're spreading out the patrols across a broader part of the community so the patrols will be less concentrated in a few places. And we're working on proving this by looking at what the demographics are in a city compared to the boxes where we produce where the directed patrols go. And this is -- this will all be compared to whatever the current method is an agency is using to send patrol cars, which most likely is the hotspot policing approach, which only uses historical crime data. We're also looking at measuring community sentiment in future [ AV ] tests. So that's how we would approach that.

Great. Thank you, Sam. Next question is related to retail areas. And the question is, do you think that a ShotSpotter type of technology could become part of a building code? And actually, Sam, you have some additional information on that. I'll turn that back over to you to give you an opportunity for that.

Sure. Obviously, it would be a dream to have gunshot detection technology built into a building code like a smoke alarm. But I think because the risk of gun violence varies by city and varies even within different parts of the city, it's not likely to happen in the near future. One of the interesting areas that's related, we've seen a rise in the popularity of active shooter insurance. And that mandates certain technologies must be used to obtain that insurance. And so there's some possibilities for becoming a standard in that sense.

Great. Thank you, Sam. Excellent answer. Dan, we'll send the next one over to you. And the question is, how tightly has NYPD integrated Respond with Investigate? What benefits are created for both Respond and Investigate? And what could that tell us about the opportunity to cross-sell Investigate to other Respond customers across the country? Dan?

So at NYPD, it is not integrated. The case management has been there for several, several years and so has ShotSpotter. We're now just getting that integration. Work between Investigate and Respond is underway now. So that's something that will be implemented in NYPD. And Sam, I was going to turn that -- second half of that question over to you in terms of the opportunity.

Yes. Sure. It's really interesting. We -- I mentioned some research we did with detectives and supervisors in the area of case management. And among current customers, they see a nice advantage of having the data flow from Respond into the case management system and basically be placed in a waiting room. So if the case gets open, they have access to all of the Respond data, the date the incident occurred, the time, the sequence of shots of the reports that come with Respond alerts, anything that's relevant, it would automatically flow into the case and be a nice time saver for them.

Excellent answer. And Sam, it looks like you're going to be answering a lot of our questions for us today. The next question is, is Investigate pricing based on a per-user-per-month basis or based on the city's population?

Sure. That's going to be a tiered annual subscription fee based on the agency size. It's not going to be based on users. We fundamentally believe that the more people that use it, detectives, supervisors, command staff, patrol, district attorneys, the more success and value there will be and the stickier, ultimately, it will be as well. And that's how we've priced our other products with that structure.

Great. Thank you. We have another question, a new question, which is, what are the top 2 international countries that look most promising? So I could handle that or anyone else, Ralph as well. At this point, internationally, we're still dealing with a lot of the challenges from the pandemic. However, most of what we have in our pipeline hasn't changed. It's just been delayed a little bit. I would say if we were to say the top ones that are most promising for us, it would still be South Africa, Brazil, Mexico and probably even some cities like -- countries we're already in like even the Bahamas and the Caribbean as well. Okay. Next question says, can you talk about the go-to-market strategy with retail locations? Have you thought about the size of this opportunity? Sam, back over to you. The short answer is yes. He also added some of this on the new TAM slide that most of you probably saw. Anything you want to add about that or the strategy there, Sam?

Yes. The strategy with retail is partly what I mentioned about getting really focused on that and creating content, lead gen materials and other techniques to appeal to this group. I mentioned the association, the loss prevention association and having a webinar with them and their audience using their -- all the folks that are members of their association. So again, we believe that we have to take it almost sector-by-sector, and we think retail is great because there's multi-site retailers. They can have hundreds. They can have thousands of sites. And if you can prove your worth in 1 or 2 of those areas, then you have the potential to quickly spread. So it's through a focused and very targeted program.

Great. Thank you, Sam. The next question says it appears based on the 2026 revenue target and breakdown that the company anticipates a 5-year revenue CAGR for the domestic gunshot detection business of approximately 8%. Does the company believe that this outlook is perhaps conservative? And are there potential strategies to drive this growth rate higher? I'll go ahead to start and then -- go ahead, Ralph.

Yes. Thanks. Yes, so I think, mathematically, I think that does work out that way. But I would say that there could be the opportunity to have that growth accelerated domestically if we were able to reach the tipping point sooner, where the standard of care, capabilities of our solution are kind of embraced by local police departments. What's happening underneath that number, though, you should just understand is that we are seeing or expecting to see accelerated growth in domestic acoustic gunshot detection for our security applications and probably further down the Tier 4, Tier 5 market. We're seeing some very broad take-up of that opportunity at the lower end.

Okay. Excellent. Thank you. We have another question, which says, what other notable vendors other than Leeds does NYPD use for technology application used by law enforcement? Do any of those also sell case management into NYPD? And then Dan, it's a new question. Hopefully, you have a chance to maybe give us an answer for that one. What do you think, Dan?

Yes. Absolutely. So we're obviously there providing mission-critical systems and what I call field operational systems. Also, IBM is providing services there, and their services are pretty much limited to data warehousing, which all our systems feed. And Microsoft is there as one of the other contractors, and they pretty much do a lot of mobile phone applications they call domain awareness. So the 3 groups, the 3 vendors work very closely together. We meet twice a week as 3 vendors to discuss any integration that we got going on or issues that we've got going on, but none of them provide case management or attempting to sell case management to NYPD. There is one other vendor who's been there for a long time, who does provide case management services. And we've already replaced them twice, and we're now replacing them from the intelligence bureau, and there's absolutely no other trace of any other vendor providing RMS or case management at the NYPD.

Great. Thank you, Dan. Another question, is much of the pipeline coming from Tier 1 cities or from Tier 2 to Tier 5 cities? And what percentage of the pipeline comes from schools and corporations? I'll go ahead and start that. I would say that we are also -- are always working on adding to large cities, such as the Tier 1 cities. In fact, recently, you've heard we've gone live in Detroit. We've gone live in Houston, although it's a pilot program. We also went live, not necessarily a Tier 1, it might be a Tier 1.1, which is in Cleveland. So in our pipeline, we always have Tier 1 all the way through Tier 5 cities included in there. We are starting to see, especially near the end of 2020 and in 2021, where we're getting more opportunities for the Tier 4 and Tier 5 cities, which are very small populations, which we're pretty excited about that. There's some of those in the pipeline as well. The second question is, what percentage of the pipeline comes from schools and corporations? While we're going after some of those from a pipeline perspective, there's very little that we're actually expecting in terms of our guidance that we gave for 2021, in terms of actual GAAP revenue for this year.

I'll just add that Gary Bunyard, our Head of Sales, will be going over some more details about the pipeline per segment in the Thursday session.

Yes. But I think also, Sam, it's fair to say that we're pivoting some of our marketing dollars and resources to focus more on building that pipeline, correct?

Yes. Connect, Investigate and Security, which would include the schools and corporations, will be a focus in 2021 and forward.

Absolutely. So that's the last question that we have. Are there any other questions? If you can, please type quickly. Otherwise, we'll just about be done and maybe give people a little bit of time back. It looks like we do have one more question. Let's see. How hard is it for a city to transition to investigate from their legacy systems? Is this product aimed at smaller or larger cities? Dan or Sam could take that, either one of those.

I think maybe both of us take a shot at it. It's -- if we're talking about case management, it's not hard to transition. Typically, these case management systems or case management procedures or processes the cities are using today are paper-based or other systems as, like, used with Excel or Word documents. So the transition is possibly a massive amount of scanning if they wanted to preserve some of their records, but we find that the transition to case management is typically go forward. There's very little that agencies want to convert. And integrating with their existing RMS is something we do very well. And I don't see any issues there at all. Sam, I don't know if you want to have anything to add.

Yes. In terms of the targeting and the size of the city, it's really -- it's the number of cases that they have. And I think our initial look at the market is that we probably focus on the upper half of the market, Tier 1 through 3, where there's lots of cases. There's lots of complexity. There's multiple systems being used to take a piece and part of this, and we can bring a simpler, all-in-one approach for them.

Excellent. Great. And Dan, the second question goes along with this. How many decision-makers or procurement people do you actually work with at NYPD and you're having to cultivate relationships with lots of others?

Well, I have relationships with almost every single of the bureau heads. We -- the process usually starts working with the Deputy Commissioner of IT. He'll -- that person will get requests from the bureaus as to new needs. And depending if it falls into case management, falls into records management, it comes to us. We work directly with those bureau heads to come up with a plan and provide a proposal. And the proposal really depends on the size of their project, if it falls into what we call support services. There are a lot of things we do on the support services. For instance, we recently deployed an enhancement to our case management system to specifically track gun arrests. So it tracks gun arrests from [ apprehensions ] all the way through prosecution to improve the prosecution rate of gun arrests to get guns off the street or the shooters off the street. So we've worked very closely with the decision-makers, specifically at the IT level and at the business level.

Excellent. Next question is tied to our new community efforts. In terms of the new retail site secure product, it sounds similar to the prior efforts for campus secure for universities and corporate campuses, which has struggled to gain traction. While there's obviously a couple of high-profile recent events that demonstrate possible need, what will be different about the retail site secure? And who do you see is the primary client that will pay for that type of product? Would it be a landlord?

Yes, I can take that if you want.

Yes. Go ahead, Sam.

Well, I certainly can't predict the future on this program that just launched today. This push into this part of the market is market-driven. We received a significant number of inbounds starting late last year as these retailers were starting to -- and other corporate entities, for that matter, were starting to take accountability for their security into their own hands and want to kind of control their own destiny. So we'll have to see. I think it's going to be a combination in terms of the building owner versus the tenant. I tend to think it's going to be more building owner for larger retail chains. They're going to want to take advantage of this solution.

Yes. Great. Great answer there, Sam. Next question says, is Leeds expected to compete with RMS providers like Mark43, Tyler Technologies and others? Or is it focused mainly on new case management?

Sam, do you want me to take this one or you want to take it?

Why don't you start?

Well, compete, most likely, yes. I think a lot of folks out there think that their RMS system is their case management system. And so we'll always have that level of competition. But basically, their RMS systems have what we call bolt-on case management option. So they're not true case management systems to the point of what ShotSpotter Investigate is. So when it comes to competing, we've already gone up against a lot of these firms, and we've basically won on a few competitions in terms of case management. And yes, we are focused mainly on case management. Sam?

No, nothing to add. Thank you.

Yes. Great. Thank you. Next question, is the new retail market discussed in the press release today offering a new technology or the same technology for buyers of the lease? Bottom line is -- go ahead, go ahead, Sam.

It's really announcing a new program. It's a program that's targeting marketing and sales resources at this particular segment of retail just like we targeted those same types of resources towards the smaller agencies, the lower-tier agencies last year and saw some nice momentum there. So we're trying to pull from that playbook in terms of retailers.

And then last question we have, how much forward guidance to double the revenues is dependent on international revenue? What turnover, cancellation expectations you have embedded in your guidance to 2026? I'll go ahead and answer that. Honestly, at this point, we do have -- by the time we double that revenue, international will be -- we expect it to be somewhere between $10 million and $15 million of that. We don't necessarily add a cancellation or attrition in 2026. We [ answered ] that and add that year-to-year. So for example, while we would normally expect it to be -- while it would normally be around 2%, last year it was only 1%, this year, where it's -- because we're still fighting with some of the COVID stuff and pandemic issues, we have in our current guidance said it could be as high as 3% to 3% to 4%. So ultimately, by the time we get to that $118 million of revenue, which will be doubling of the revenue through 2026, we would have been working through that each year. So that would already be integrated into those numbers.

Yes. And I think I would just add to it, let's be careful. I don't think we would call this guidance as much as that's kind of our forward plan over the next 6 years. So we want to be precise about that as well.

Yes. Excellent question. Thank you. Yes, just to be clear on that, the only guidance we give and have given is where we're at for revenue through 2021. That's all the questions we have. Thank you very much. Ralph, anything else that we need to add here?

No. Thank you very much. Really appreciate it and looking forward to seeing most, if not all, of you 2 days from now, on Thursday. We're going to walk you through some other presentations from the other senior leadership team. So thank you very much. Everybody, have a great day.

Okay. Thanks, everybody. Bye-bye.