Inside The AI Weapon Detection Business With CEO Of Evolv Technology

Forbes

Senior writer Jabari Young interviews Peter George, the CEO of Evolv Technology, a security company that deploys weapon detection systems at sporting events, concert venues, museums and other venues where people gather.  0:00 Introduction 0:50 John Thompson And His Legacy 2:30 Evolv Technology & Its Partnership With The NBA 5:01 The NBA And AI Detection Software 6:46 How Can Evolv Technology Help Major Event Venues? 8:11 About Evolv And The Good It Can Do 9:56 Investing In Evolv 12:29 Peter's Background And His Commitment As CEO Of Evolv 17:21 Safety Is The Most Important Thing When Attending Live Events 19:46 How Is Geo Politics Effecting This Type Of Technology 20:59 De-Globalization: What Does It Mean?  23:04 The Issues Of Physical Security And Technical Security  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00 It's a security as a software company traded right here on the NASDAQ and it got some interesting news to announce

00:05 We'll tell you what it is right now

00:07 Hello everyone, I'm Jabari young here at the NASDAQ market site your Forbes senior writer and editor

00:14 And I am joined by Peter George the CEO of evolved technologies. Thank you so much for joining me, sir

00:20 This evolved the maker of a weapons detecting stick detection system get that right as well as making touchless security screening products

00:28 You want to replace the metal detector? That's easy and we get into all that and more. So I appreciate the time

00:32 Yeah thrilled to be here. Absolutely. Listen, it's Black History Month as we speak. And so I always want to start right there

00:38 your most notable

00:40 Black History Month figure somebody who you probably looked up to and ignored a familiar names the notable names the market

00:46 Someone that maybe we wouldn't think about now that it's Black History Month. Who was inspired? Yeah. I

00:54 Would say in the business world and I actually came from the cyber security business before joining physical security

01:00 John Thompson was a world-class executive

01:03 Headed semantic a leader in cyber security and then was the chairman of Microsoft up until last couple of years

01:10 So world-class executive very strategic about everything he did and somebody that I admired in the business world. Absolutely

01:17 Let's get into some strategy now, right? You've all you got some news to announce

01:21 You are now a partner of the NBA and looking forward to see what that is

01:25 Now listen, you may people may use evolve. I know we use it to get into this very building. You walk right in

01:32 Nobody checks you don't have to put any stuff you pull any of your things out

01:35 I love that and now you're with the NBA explain this partnership

01:39 Yeah

01:40 so we've been partnering with all the other professional sporting teams for the last couple of years and

01:46 Now we're partnering with the NBA

01:48 so today eight NBA stadiums are using our technology today and

01:53 They're like all the other professional sporting teams want a consistent high level fan experience

01:59 Yeah, starting with making the venue safer

02:01 But then secondly making the fan experience second to none and the idea of walking into an NBA game

02:08 and not

02:09 divesting of your metal like you normally do when you go through a metal detector and

02:13 Unless you have a weapon on you being able to walk right in is an amazing experience for people and we've seen great

02:20 Statistics on guest services and the fan experience MPS scores go up

02:25 But mostly we're making the venue safer, which is the primary reason we exist

02:29 Absolutely. Now listen, you're with the footprints Center, right with the Suns ball arena the Nuggets Toyota Center with the Rockets

02:36 I was at the Mercedes-Benz stadium down in Atlanta, and that's when I first realized

02:41 Yeah, that's evolved right? I know we were talking with your PR team about doing this for quite some time

02:46 Also with the Houston Texas and Minnesota Wild National Hockey League again, you are now covering all sports of the majors

02:52 On the landscape. What is that going to do for the business Peter? I mean, listen, I'm looking at the company again traded on the NASDAQ

02:59 It's not the best price of a stock

03:01 But at the same time still a young company just hit the public markets what in 2001 via a stack

03:07 Yeah, what is this?

03:09 2020 2021. That's right. Was that July?

03:11 2021 what is this deal going to do for the value of the company and how is it going to maybe increase your stock price?

03:18 yeah, so professional sports is a

03:20 natural place for us to be yeah, right and

03:24 This is a 20 billion dollar total available market 2 billion is regulated. So think about airports

03:31 Prisons and professional sports, but the other 18 billion are all those other places

03:37 Yeah schools and hospitals museums

03:40 Performing arts venues where people gather and want to gather safely, but couldn't do it with that old technology

03:47 So back to professional sports

03:49 The power of the professional sports is so many people go into those games an NFL game Mercedes-Benz Stadium for the Falcon

03:57 82,000 people

03:59 experience evolve and when they go through and they see lines have either gotten shorter or

04:04 Virtually gone away and they walk right in from the street to their seat without taking out anything

04:11 It's game-changing and so it's a really important market because not everyone knows us today. We're not a household name yet

04:19 Yes

04:19 But we certainly want to be but when you go to a professional sporting

04:22 Game or even a college game where we are and you walk right in it's such a different experience

04:27 Those are moms and dads thinking about their kids at school

04:31 Those are doctors and nurses that go into the hospitals

04:35 70% of workplace violence is in health care. And so it gives us the brand recognition to finally say hey

04:42 There's technology out there today that actually can change everything. It's not a metal detector

04:47 It's a weapons detector and unless you're looking for unless you're carrying a weapon you get to walk right in so it's giving us

04:54 Enormous exposure we wouldn't normally get so long and short of it is we love professional sports for that reason

05:01 Yeah, listen, it takes time for new products like yours for people to adapt to them

05:05 They don't want to leave out of their comfort zone. Yeah, this is already in so, you know, how do you expand that?

05:10 I know I was looking through your 10k reports and you were saying that a key piece of revenue for you guys

05:13 Oh, that is the annual recurring revenue

05:15 Yeah

05:16 And I would assume that this NBA deal may be that but also within that 10k report a lot of the machines that you're using

05:21 They're poly programs. Is this NBA one?

05:24 Is that a revenue deal or is it a pilot for them to maybe see if they want to advance that?

05:28 Yep, so we've already been sanctioned by all the other professional sporting teams were on their

05:33 Arthrite screening list

05:35 Yeah

05:36 it started with the MLB and then NFL and MLS and now in conjunction with basketball and

05:42 NHL because those stadiums are oftentimes shared

05:46 So when people use us they put us in it's a four-year contract not one year

05:53 During that time. There's a sensor platform you walk through but during that time they have a 48 month or four year

05:59 Subscription and one of the values of our technology because it's security

06:04 We have to stay on the cutting edge of the the adversary. So we update our software all the time

06:10 So four times a year we add the new scans that we've gotten from all of our other customers

06:15 We've screened a billion people Jabari and date we take those scans

06:19 We make our system smarter the security better and and the efficacy better and our customers love that

06:26 Yeah, and 2.3 million people per day you guys estimate you scan

06:29 We are screening today on an average day even more people than the TSA, which is amazing

06:35 And of course, they're using dumb metal detectors

06:38 They can't they don't even know arrival rates or who's coming through we capture that data and we can use that data to make our system

06:45 Smart. Well, that's that's the kind of piggyback on that because I believe you guys were, you know

06:48 Kind of awarded recognition by Homeland Security US Department of Homeland Security. Why not TSA?

06:54 Why aren't they incorporating your tech because everybody hates airport lines, right if we can avoid them we get through why what is what is the taking?

07:02 So long for them to maybe implement, you know evolve technology into airports, which would probably help your revenue a lot

07:08 Yeah, well, the truth is there's a million lanes of metal detectors mostly at airports the TSA's

07:15 Responsibility is to create a sterile environment, right? Because you're going on to a plane

07:20 You're going in the air and there's 500 people in the plane

07:24 Something could bring that plane down and kill a lot of people quickly

07:27 So it has to be sterile and even though we hate that line

07:30 We're willing to wait in that line sometimes because we knows that what's at risk

07:34 We're focused on the the untapped market the 18 billion of places that always wanted security

07:41 But their only alternative was that dumb metal detector. Most of them did nothing

07:46 Yeah, right

07:46 Those are places now that say wow now I can create a frictionless experience

07:51 Put systems and people walk right in without breaking stride and know when they get in there. There's no weapon there

07:57 So long and short of is it we're focused on that 18 billion dollar Tam of museums and schools and places

08:03 That wanted security and now can have it because there's technology that can help. Yeah, I wanted school dishes

08:09 You are and I believe it's Charlotte. You have your systems down Charlotte Mecklenburg is one school

08:13 We're in 700 school buildings today nine states still and across the US not even more than nine states

08:18 I think I think more like 40 states, okay

08:21 And we in the morning and in a Monday to Friday morning typical morning. We're helping

08:28 325,000 kids get into school in a safer way, which it talks to our mission like like nothing there is

08:36 I have four kids my daughter's a second grade teacher at a school and the thought that on the second day of

08:42 Every school year and she's been a teacher for ten years that she's hiding under a desk

08:47 Teaching her kids or eight-year-olds had a hide from a bad guy with a gun is criminal

08:53 Yeah, so we have technology now that can make school safer and really proud about that

08:58 It represents about 50% of our business. Absolutely. And they also you still with win casinos six flags

09:04 Hollywood just got the deal with the ASM global again the Charlotte school district and then you have some notable investors

09:10 Theo Epstein Peyton Manning Bill Gates at one point

09:12 I don't know if he's still investor Jeb Bush through his fin back investment partners all those still investors in the company

09:17 Yeah, most of them are we don't know exactly the profile Bill Gates Bill and Melinda invested in our company in the very beginning

09:25 They're still our largest investor

09:27 They chose our company because they saw our AI weapons detection technology as game-changing

09:34 And they're still are one of our largest investors. We do have those notable

09:39 Sports figures because they understand the challenges of getting thousands of people into a game in a couple hours. It's really hard

09:47 Yeah, so we can use technology to make the venue safer, but also reduce if not eliminate the lines

09:54 It's huge for them. So they they do they do like that. Let's look into the business a little bit, right?

09:58 When you entered the the public markets month, July 2021

10:01 There's about a 1.3 billion dollar total enterprise value

10:05 I said in the aspect announcement and this is back is with new hold investment Corp

10:10 It was a blank check company formed in 2020 and now that business combination again approved

10:15 And here you are, right?

10:16 This is a company that is 700 plus million dollar market cap right now in the Nasdaq as we sit February 11

10:23 It was a eight dollars and thirty cent August 2033. That was a high in 2021

10:28 It was as high as 1290 I believe and then it fell to a low of two dollars and four forty one cents in March

10:35 2023

10:36 But I look around and I keep saying brokerage firm saying bye bye bye bye bye

10:40 Why would someone buy a stock that is sitting at the $5 point? Yeah. Well, let's start with the problem

10:47 We're solving. Yeah, we have a gun violence epidemic in America

10:51 There are more guns than people over 400 million guns

10:54 Guns just overtook car accidents as the number one reason why teenagers die

11:01 And there's a lot of anxiety in the world and people know it and it's almost last year. There were

11:06 460 I'm sorry

11:09 648 mass shootings in America. So too many guns too much anxiety too many people everyone knows

11:16 It's a problem and everyone also knows the only technology prior to evolve

11:21 Available to stop weapons from going into places was a dumb metal detector, which was fantastic for finding metal a hundred years ago

11:29 We all carry metal today our iPhones our keys not very good at finding weapons

11:34 So we're using the most contemporary technology think about advanced sensors

11:39 big data software and artificial intelligence

11:43 To flip the model which is to say we're assuming you don't have a weapon until you do

11:49 Yeah, right. We create a magnetic field let you walk in and if you have a weapon we can identify you

11:55 Put a box around the threat and quickly resolve it

11:58 But mostly people can just walk in in a frictionless way because most people aren't carrying a weapon around

12:04 so that's the reason why this problem when people walk through our system and

12:09 Experience our security and it's so different than a metal detector. Everyone has an aha moment

12:15 So that's the reason why big problem to solve really contemporary technology

12:20 Nobody does it the way we do it today and you know

12:23 We're the world leader in the space and we're barely at 1% of the market opportunity to grow. Yeah

12:29 Flashback right when you were CEO of this company drew January 2020. I'm not mistaken. Yeah, I'm you change July 2021 again

12:37 You guys were public. Why did you become CEO? Why did you want to take on this role being as though your cyber background?

12:43 You could have stayed in the cyber security space. I was just with US National Security Director Harry Corker in Washington, DC

12:49 He says we need jobs. We need people down here doing cyber

12:52 You could have stayed in the cyber security space and made a lot of money. Why take on the CEO role?

12:56 Because of the mission because I had to

13:00 Because I was called to so I spent 20 years in the cyber security space loved it ran a couple of companies

13:09 One of them actually did the forensics work on the DNC breach along with CrowdStrike and Palo Alto Network

13:16 So I felt very privileged to be in that industry having said that over 20 years a lot of investment in cyber security

13:23 Lots of dollars flowing into it and too many companies five thousand companies in cyber security

13:30 Chasing the same CISOs very noisy crowded market an important market

13:34 I was shocked Jabari when I learned about

13:38 Evolve the idea that our founders took the most contemporary cyber like technology

13:44 To solve this problem and the only alternative was a was a metal detector

13:50 I knew there was a really big thing to go do a big

13:53 valuable

13:55 Company to go build an iconic company to build and also I fell in love with the mission the idea to do something

14:02 That was bigger than you. I just felt called to do it

14:05 So I love working here and everybody in the company all the Evolvers

14:09 We wake up every day think about this problem and what we can what we can do to solve the problem tomorrow

14:15 I know this is probably an easy one

14:17 So I'm not gonna let you get the easy way out

14:18 Right, it's easy to say the pandemic because you took over in January in 2020 a few months later

14:22 We have a pandemic. I'm sure you got caught by surprise like everybody else, but take that out of the equation

14:28 You're in the biggest positive surprise about evolve and you run in a CEO

14:32 I was really surprised to be honest that

14:42 Metal detectors was the only innovation in the industry or what I should say is there hadn't been a innovation

14:50 I was surprised that nobody was using contemporary AI

14:55 Technology to solve a really really really it's a hard problem to solve but to solve something that was so urgent in the world today

15:02 So the big surprise was learning that and then as people came out of kovat and saw there was now

15:08 Technology that could allow people to gather

15:11 together in a different way

15:14 That was a surprise in our business just accelerated

15:18 We first started winning all the theme parks and those were the places if you remember, dr

15:23 Fauci was saying we could gather again, but it needs to be outside

15:27 You can't be in a line and nobody could touch your stuff

15:30 Well metal detectors can't do that and our customers were pushing hundreds of metal detectors in a closet

15:36 using our technology and we helped open up six flags and a lot of our key customers and then it went from theme parks to

15:45 Schools and performing arts venues. We're here in New York today

15:49 A lot of the key museums and performing arts venues in the city, including the New York Mets at Citi Field are using our technology

15:56 Yeah, super proud of that. Absolutely. Also, it's Georgia Aquarium

15:59 I had a chance to take my dog was that Mercedes Benz and I go right down the street

16:02 Yeah, I'm sure query man is evolved. Yeah positive surprise. That's great. Yeah, what's been the biggest negative surprise?

16:08 Yeah, I would say we're in the education phase when a company is transforming an industry and we're transforming

16:15 Physical security we're doing the digital transformation of physical security

16:19 there's a lot of resistance right our

16:22 Decision makers our former law enforcement former military three-letter agencies

16:29 But they're used to doing in the same way and because they haven't had exposure to evolve

16:34 There's an education process that we need to take them through and take the public through for them to appreciate what new

16:42 Technology can do to help with the problem. There's no perfect security

16:45 We can buy down risk we can layer security

16:49 These guys are the most sophisticated security men and women in the world, but it's new technology for them

16:55 So the education for them takes more time than we thought and the brand awareness, right again people don't know us

17:01 Yeah, we went to to be a public company

17:04 It we were an undersized company and we're growing into ourselves in the public market

17:09 But the more systems we put out there and we have more than 4,000 now around the world

17:14 You've experienced them in some places when you walk through and say wow, I just got screened. This is so different

17:20 It's really help. I don't walk through I just walk through and I'm like this and when I see evolve

17:24 I'm like, oh good. I'm gonna empty out my stuff, right?

17:26 Cuz there's still a few arenas that are using metal detectors

17:29 I was just that one I'm not gonna say their name for the 76 years

17:31 But at the same time I had to take off my belt all this other stuff and it was only like a coat pin

17:36 That was I'm like, are you serious who wants to do that?

17:38 I see your favorite basketball game or to see Taylor Swift

17:41 We've screened two million Swifties over the last six months or so. We're gonna do the ones out in Melbourne

17:48 No one wants to do that to go in and see their favorite sports team or see the concert

17:53 It's one thing with an airplane, but we don't want to do that any absolute absolutely here at the nasdaq market site

17:58 Ready to wrap up a little bit. But again, we were talking about sports. Let's bring it right back to it again

18:02 You're with the NBA now in that partnership. Yeah, what do you like about the NBA?

18:06 And why is this league maybe going to help evolve take their company to the next level?

18:11 Yeah, well look the NBA has a phenomenal product, right? I mean everyone loves to go watch basketball

18:17 I'm from Boston. We have a great team up there. We do and when he rushes no

18:20 But we have a great team up in Boston. We love to see them. I can walk from my home to TD

18:26 To DD North and they're gonna be a customer

18:29 Next week actually, so we're actually in

18:32 Massachusetts and in New England

18:35 We have the more than the trifecta because we have the MLB the NFL the MLS and now we have TD North

18:43 So we get both the NBA and the NHL and we just got Boston College

18:47 Yeah thrilled about that and getting into a city to do that

18:50 but I mean the NBA is just a great product and

18:53 People want to go to the game and go have fun and know they can be safe and now they can they can walk right?

18:58 In not divest of their things and get to their seat with their families and enjoy the game

19:03 Yeah, are you guys in Indiana? That's what the all-star game is this coming year. So are do you are you in?

19:08 They're not using our technology today, but we will be there working on a fan first event around it

19:14 Yeah, but you know, we just began our partnership with the NBA

19:17 So we have eight NBA arenas today

19:20 and of course

19:21 You know

19:21 There are a lot more to go again and we're gonna work with them over the next couple of years and partner with them to

19:26 Make the fan experience amazing and it starts with making them safer

19:30 How did you have to get the pitch Adam Silver and Mark Tatum?

19:32 Did you have to sit down and explain to them why this was good?

19:35 We did we work with their security team and they have a they have a phenomenal security team

19:40 They know what they're doing so that way wasn't easy to tell our story to them. Absolutely. They got us

19:44 Yeah wrapping up here. Let's get into some micro economic stuff. I'll let you go

19:48 Geopolitics, how is it affecting evolves technology? How's it affecting your supply chain?

19:53 You got problems in the sea and in the Middle East war is going on right ships being diverted around

19:59 Africa and studied through shortcuts. How is that impacting your business geopolitics the wars and then also you have an election year?

20:06 Yeah, great. Great. Well a couple of years ago

20:08 There was a global supply chain problem that impacted everybody including us. Yeah, and we had to really

20:14 Over engineer how we made sure that we had enough systems to put in but you know, that's pretty much gone away

20:21 so I would say that we don't have a global supply chain problem and just the the

20:26 Anxiety and the polarization around the world and worse have people on on high alert

20:33 And of course, you know our technology wherever it goes as people gather

20:37 They think about some of the stresses in the world and having technology that can create safer zones for people to gather

20:44 It's actually a good thing for us

20:46 So so, you know, we feel privileged to be in a position where technology can help people gather

20:52 Together in a new way even amongst all the things that are going on in the world and and it's helping our business

20:58 One word that everybody keeps saying I don't know if it's a bad word a good word

21:02 I guess the panel how you look at it is the word called the globalization

21:05 All right

21:06 We have went through a period where globalization was good prices were great because of it

21:10 Yeah, now we're answering a very very dangerous area where deglobalization could be on the rise if it is

21:15 How is that going to impact your business? Yeah

21:17 Yeah, I don't think it's going to I think our business is it's just appropriate

21:22 We're when people gather that people want to be safe and now technology can help so we think it can help work

21:28 We're today 98% of our businesses here in North America

21:32 The primary weapon that people use for mass casualties or guns. We have too many guns here

21:37 So we're spending our time here

21:39 But as people gather in stadiums around the world

21:41 It's places that we want to be and they want us there. So we're looking forward to that and speaking of guys

21:47 Listen, we can't ignore the fact that you know

21:49 Just a mega church down in Houston just went through an issue with gun violence

21:53 And so when you see these things continuously pop up

21:55 Is that what you use to tell your clients listen?

21:58 You guys need to adopt this because it's going to help maybe not have those many incidents like I mean we talk about a church

22:04 Yeah, if you can't even go to a church without somebody coming in having to work. What's where can you go? Yeah

22:09 No, it's true. I mean, this is a problem everywhere. No

22:13 Vertical or no state or no place

22:16 Is going to be free from that so putting using technology to help is really important

22:22 And when the when something bad happens, we normally have a moment of silence in our company

22:26 And then we go back to work. We write better code

22:29 We work really really hard to get more systems in place because the more

22:33 Systems we can put in schools and in hospitals to protect people

22:37 Maybe we can prevent the next thing from from happening knowing there's no perfect prevention

22:42 But technology can help and we were purpose-built to solve this problem. Absolutely. Well, listen get you out of here on this Jim Collins

22:49 What a great book good to great

22:51 And appreciate the time again and using your security background and what you're doing now with touchless, you know

22:58 Security screening products. What is the difference between a good security company and a great one?

23:03 Yeah, well, that's a great question

23:05 We are at the cross

23:10 hairs of both physical and cybersecurity and

23:13 I think we have we're the only company that's digitized

23:19 The safety problem and the idea of integrating physical and cybersecurity so you can have the threat intelligence and situational awareness

23:29 Protect people but also to communicate to everybody that there's no perfect prevention

23:34 That the people that make these decisions are smart

23:38 They know there's no perfect solution

23:41 But if we can buy down risk and be transparent with our customers about what the technology can and can do do

23:48 I think we're doing as much as we can to help our customers and to me greatness is

23:54 Working together to solve an important problem for your customers and being transparent and we work really hard to do that. Absolutely

24:00 Well, listen, sir, good luck to you being a public company is not easy

24:03 You got the fees all of your finances are all there in display

24:07 I mean I had a field day looking at this stuff last night

24:09 I know it's not easy because you're exposed right and I there's certain things that I know I've seen in a 10k report

24:14 That's just may see it may turn them off

24:16 But again, you are solving a problem

24:18 So good luck to it because I get to walk into this very building every day

24:21 Using evolve or when I'm here on Mondays, I should say using evolve

24:24 So definitely appreciate the time here at the nasdaq market site Peter George the CEO of evolve. We'll see you next time

24:30 You

24:32 You

24:34 You

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