John Dyess started his Austin security company by investing $400 in two surveillance cameras.
In classic bootstrapping fashion, he used the money he made from installing those cameras to buy more. And he has continued that strategy of investing back into the business during Dyezz Surveillance and Security Inc.’s first 10 years to build it into a $2 million-
Now Dyess is reinvesting again buying its own $1.2 million building to prepare for an expanded business model. The company, which employs 28 workers, is moving physically to its new nearly 14,000- square-foot space on Springdale Road and strategically into the fire detection business after establishing itself as a local player in the security business.per year business.
The company, which Dyess initially operated from his girlfriend’s kitchen, is a lesson in the patience and persistence needed to compete with much larger national vendors. Enthusiasm for business needs to be tempered with a measure of caution, Dyess said.
“It’s drive [that’s important], but not trying to do too much too fast,” he said. “You always want to be safe.
Dyess, an El Paso native who didn’t attend college, got his start in security by managing inventory control for a chain of car audio stores. After getting laid off in 2001, he decided to capitalize on his experience with surveillance cameras.
Dyezz Surveillance also operates an access control business that generates about 10 percent of the company’s revenue.
About 70 percent of Dyezz Surveillance customers are video security and 20 percent use conventional alarm systems.
The company initially provided mostly residential security, but the technology has made surveillance cameras more affordable and less invasive for business owners. As a result, commercial properties now account for about 60 percent of Dyezz Surveillance’s business, with 40 percent coming from residential customers.
A typical residential system cost $1,700, and the typical commercial system costs $4,000, Dyess said.
He considers his chief security competitor to be Florida-based ADT Security Services. The company is a division of ADT Worldwide, which is a unit of Switzerland-based Tyco International Ltd. (NYSE: TYC). Last year, ADT combined with Tyco’s other security divisions to generate $8.6 billion in revenue, or 49 percent of the company’s sales, according to a filing with the U.S. Securities and Exchange Commission.
That’s some serious competition.
Dyess is working to attract ADT customers by offering a lower rate and no annual contracts, while the company is expanding its services with fire detection and opening Dyezz offices in Houston and Dallas. It already operates a three-person office in San Antonio.
The new headquarters and warehouse is an important part of the company’s expansion plans because it needs to house Dyezz Surveillance’s growing inventory.
The Carmark Group Inc. enlisted Dyezz Surveillance five years ago to install video cameras in its clubs. This Austin-based company operates for bars and nightclubs in Austin such as The Dogwood on West Sixth. It’s also building another club in Houston and one off East Sixth Street, owner Jason Carrier said.
The company, which has been operating for five years before Dyezz started, had never used cameras because the cost and quality of images was prohibitive. But improvements in technology have changed that. Carrier said that each establishment now includes 16 to 32 cameras that enable him to remotely monitor operations from his computer or smartphone.
“You stay connected [to the business] without being physically connected,” he said. “The technology has caught up where it’s not a luxury anymore—but a possibility.”
This article appeared in the September 21st 2012 edition of The Austin Business Journal written by Christopher Calman.