Investors greeted ShotSpotter with a warm reception on Wednesday, on its first day as a public company. After pricing the IPO at $11, the stock closed at $13.86, or up about 26 percent.
ShotSpotter notifies police departments about gun violence by using sensors that ignore ambient noise. Their sophisticated technology alerts authorities within 45 seconds of the trigger being pulled.
It’s currently used in about 90 cities, including New York, Chicago and San Francisco. ShotSpotter estimates that about 80 percent of gun violence goes unreported, and they are in the process of convincing municipalities worldwide that their technology will reduce fatalities.
According to CEO Ralph Clark, it’s not just about catching assailants, but they hope to deter crime also. “No police response leads to normalization of gun violence,” he claims.
ShotSpotter makes money by charging local governments on an annual subscription basis. According to their IPO filing, they had just $15.5 million in revenue last year and $11.8 million the year before. Losses increased from $6.2 million to $6.9 million in that time frame.
That is likely why the IPO was so small, raising just over $30 million. They will be using some of the proceeds to pay down debt.
But they are optimistic they will expand to more cities, because clearly “gun violence is a fairly big problem in the U.S. and globally,” said Clark. “We want to continue to invest in customer success,” he said.
The largest stakeholders are Lauder Partners, Motorola Solutions and Claremont Creek Ventures. The Mountain View, Calif.-based company previously raised at least $67 million in funding.