Acre is a company built on mergers and acquisitions (M&A). Since its founding in 2012, Acre acquired several familiar access control companies, from Vanderbilt to RS2 Technologies, Open Options to Feenics, and several others. Acre itself was acquired in 2021 by UK-based private equity firm Triton, thus launching a new chapter in the company's history.
Don Joos was named the new CEO in 2022 and set about transforming Acre from a collection of acquired companies into a coherent whole (representing various brands). A year later, we recently caught up with Don Joos to discuss the "new Acre" and what's ahead.
Q: How does your background inform your approach to leading Acre Security?
In physical security, there is a shift to more of a software-centric versus hardware approach
Joos: This is my fourth company as CEO. What I’ve found along the way is that no matter the size or type of business, there’s a common theme, the business is going through some form of evolution or transformation because the industry they're in is going through an evolution.
And today, in physical security, there is a shift to more of a software-centric versus hardware approach, and there’s a shift occurring that’s pulling us to the cloud. I think a key thing here is that while the industry is evolving, we must keep a careful eye on the evolution of the customer because the customer is the one who will dictate the pace of change, and I think that is what a lot of people sometimes lose sight of.
Q: It seems Acre is on the path from being a “collection of small companies” to “a collection of brands within a single company.”
Joos: I think most people think of Acre as a federation of companies. Acre Security was seen more as a holding company. For me, I think the biggest misconception is just that: “This is just a federation of companies” versus “This is a business.”
Acre Security is a business that has a range of portfolios to address key verticals and pivotal business problems for customers. Because of what’s happening now and the market dynamics that are occurring, it ties back to “Who is Acre Security?” We have a clear answer as to where we want to be from cloud access control versus on-premise access control. We have clear answers regarding market segments, visitor management, and intrusion. When you think about it, those are the core areas of our business.
Q: What has surprised you the most in your first year or so at Acre?
Joos: I think the thing that surprised me the most was how similar the problems are because I was coming into a new industry.
It’s surprising how strong a correlation [security has] to other industry transformations that I’ve been a part of.
Q: What are the points of differentiation among the various Acre Security brands?
Joos: I think if you go back to the history of the company, it was designed to compete. That is, that's how it was set up under the logic of, “If we have three bids in a deal, it increases the odds that we're going to win one of them.” As we evolve, to have sustained scalable growth, it is not just about going shallow and casting a wide net. It’s about creating a concentrated focus. Some of the technology is just inherently older technology. And so for me, it’s about creating migration paths for the customers to move to more modern technology, such as the cloud. I love our installed base.
When you think about the cost of acquisition to get a new cloud customer, it costs a lot less when you have an installed base that you can migrate to the more modern solution versus having to spend the money and the sales energy to hunt for that next opportunity.
Q: Where has Acre positioned itself in the marketplace?
We can take care of your current needs, but we also have a clear migration path to take care of your future needs
Joos: If you're ready to go to the cloud, we have an answer for you. If you're not ready to go to the cloud, but you're ready to take more cloud-based applications to continue to evolve, we have an answer for you. If you're not quite ready yet and you're still looking for a market-leading premises solution, we have an answer for you, and we have a migration path when you're ready down the road.
So, you have a safe bet with Acre because we can take care of your current needs, but we also have a clear migration path to take care of your future needs.
Q: How are you building up your team?
Joos: In 2023, we’re getting a lot of core building blocks in place and making investments in people who have experience in this space or aligned industries. It is a balance. I think we need a group that understands the industry and a group that's going to come into it and challenge why we do things the way we do.
I think that makes us unique: we have fresh eyes looking at things from a different perspective. With that, you’re naturally going to end up with a better answer to problems because people are comfortable challenging the status quo.
Q: How are you seeking to expand your dealer channel and/or transition it from the various dealers “inherited” in previous acquisitions?
Joos: The channel invests in Acre Security. Our success is their success, and so what we're proposing to them is a range of solutions that supports their longevity and their financial success. But we also continue to build out our portfolio through organic technology innovation or M&A.
We're continuing to make investments in our channel strategy and how our partners interact with us
We're continuing to expand their addressable market if they want to make investments with us. We're continuing to make investments in our channel strategy and how our partners interact with us. The design of our upcoming technology right now is built with the channel in mind. We want to ensure that we are not creating any channel conflict or any perceived channel conflict. I think that's usually the worst kind: when it's perceived but not real. You need to be very upfront and clear with communications.
Q: What is the biggest challenge in the industry right now?
Joos: Companies and customers are looking to embed security into their workflows. What I mean is these are not just standalone solutions anymore. They’re integrating with enterprise resource planning (ERP) and human resource (HR) software systems. In property management, they want it integrated into the fitness center, they want it integrated into the cafeteria areas and the dry cleaners, and so forth.
So, this is about an ecosystem, and there are times when we are going to be the core, and there is going to be a lot of technology that is adjacent to us. There are times when we are the adjacency to someone else's core in a smart city or a smart building. This gets to why having an open application programming interface (API) is going to be an important part of the technology evolution. It cannot be a closed environment anymore; that is part of the past.
Q: What’s next for Acre?
We're constantly evolving our cloud access control as well as our on-premise access control
Joos: There is a lot of work going on with integrating the business into a single Acre Security company. This is an investment year for us, we are adding people to our team. We are making a lot of investments from a systems and technology perspective. We have a lot of work right now going into integrating the business from an IT infrastructure perspective and all the tools that we use from an employee perspective.
We are making a lot of investment as it relates to the commercial side. You're going to see some next-gen technology coming out from an intrusion perspective. We're constantly evolving our cloud access control as well as our on-premise access control. We're also bringing software applications, too.
Q: What is Acre’s “message” going forward?
Joos: One of the takeaways for me is this is not the Acre of the past. We are making some bold changes. New things are happening here; you better pay attention because clearly, something is different. I think that's one. I think the second is that as they spend time within us, they're going to realize the wide range of solutions and use cases that we can address, whether you're in access control or cloud, whether you're in intrusion, whether you are in visitor management, or whether you're looking at some network connectivity solutions.
The third thing that I think people are going to see is a whole lot of energy as they talk to our people and the passion that you see from the team. If I wrap those three points up in one kind of statement there, I think my goal is that people walk away saying “Something is going on at Acre Security. We better pay attention.”