by Mike Vogel
Inside an otherwise standard suburban office building in Boca Raton runs a “Main Street” with a salon/barber shop, fitness center, doctor’s office, massage therapy, chiropractor, Starbucks and a cafeteria. On a weekday morning in August, it was abuzz with the hundreds of employees who filled the building as they readied the debut of south Florida’s latest public company, residential and small-business security monitoring firm ADT.
“We’re a $3-billion startup,” jokes CEO Naren K. Gursahaney, who relocated from New Jersey to lead the company, which was spun off in late September from its Swiss parent Tyco International. It employs 625 in south Florida and 3,000 overall at its nearly 20 offices in Florida.
ADT’s challenges include competition from cable and telcos and customer attrition, which ran 13.5% in the last reported quarter as a unit of Tyco. That said, the largest U.S. security company already has drawn takeover speculation. It has a 25% operating margin, grew even in the recession, hasn’t seen its market share suffer and has lots of room to grow. Only a fifth of U.S. households have monitored security. ADT has a quarter of the $12.5-billion market. It typically posts 3% to 6% annual revenue growth. In its last quarter under Tyco, ADT saw a 5% increase in operating profit to $208 million on a 4% increase in revenue to $815 million.
Aside from providing work-life balance, Main Street has proved fruitful as a place to hold meetings and for serendipitous encounters on company business. Says Gursahaney: “It really does create an incredible open environment.”