All right. Welcome, and thank you for joining us at the TD Cowen Aerospace and Defense Conference. I'm excited to introduce Evolv Technologies, a leader in AI-enabled touchless security screening. You'll see their solutions at major stadiums, entertainment venues, and a lot of other places where people gather. Joining us today is Anil Chitkara. He's the co-founder and Chief Growth Officer, and we've also got Brian Norris, Senior Vice President of Finance and Investor Relations. He'll share a little bit about the company, and then we'll save some time at the end to run through some questions if anybody has some. Over to you.
Great. Thank you, David. Thank you, everybody, for having me here. We appreciate the opportunity to tell you a little bit more about Evolv, and particularly what we do and why we did do it. So we started the company in 2013. I'm gonna talk a little bit about the inspiration behind that that drives our mission and everything we do today, and then we'll talk about some of the impact we've had with customers. Here's the Safe Harbor. On April 15th of 2013, I was on Arlington Street in Boston. I had my kids that were 11, nine, and six at the time. My wife was running her 8th Boston Marathon. She came across the finish line. We went home. We lived outside of Boston. About 45 minutes after she finished, the first device went off, and then a few minutes later, the second device went off.
We were lucky. We had left. A close friend of mine was not so lucky. He stepped out of his office building on Boylston Street. The first device was about 200 yards to his left. He heard it. He looked. The second device was about six feet away. I went and visited him in Mass General Hospital, where many of the injured people were. There was an open bay of these people, and to see what two perpetrators did to this group of people was tragic. John is a 6'4" rugby player. He's a big guy, and he had shrapnel up and down his body, torn apart. If you rewind about four months, December 14th was Sandy Hook. We all know about Sandy Hook. Incredible, incredible tragedy. And in between that period, in about 122 days, there were 51 mass shootings. 51 mass shootings.
There were many other much more gun violence and other shootings in that period of time. It became crystal clear that this was a problem that wasn't going away, and we needed to find a way to solve it. There had been a lot of investment after 9/11 in aviation security, certainly in the military and defense-related security, but that innovation and those dollars did not go to places we were, all of us are, every day. So we started the company to do this. We started it in the summer of 2013. Our mission, very clear: make the world a safer and more enjoyable place to live, work, learn, and play. We all deserve it. My kids deserve it. My friends deserve it. You, your family, and friends deserve it. But it was changing. That arc was changing with all the violence that was happening out there.
So, we started the company. I talked to 400 different people, heads of security at sports organizations, government, office buildings, schools, hospitals, U.S., Europe, Asia, Pacific, and I asked them three questions. One, what are you worried about? What threats are you worried about? Two, how do you detect or prevent them today? What do you do? And three, how would you like to do that in the future? This was 2013 and 2014, so Al-Qaeda was moving out of the Middle East into the civilian populations in Europe, so they were worried about bombs and guns. They said, "We do one of two things. Either we have metal detectors or manual bag/ wand tracking, and it's a very sort of slow process, or we just have a more passive approach.
We have cameras and security guards." And as we stepped back, and then what they said is, "What do they want? They wanna be able to let everybody pass through and identify those few people that might need to be looked at a little more closely." It was a very simple principle. It's very hard technologically to figure out. So this is essentially the decision they were forced to make. Do they put in place a security approach that screens everybody, and whether that's a very manual full-body frisk or a more traditional walk-through metal detector where everybody takes everything out of their pockets, they slow down, they go through, or do they have cameras and guards, which means largely people aren't getting each person's not getting screened for concealed weapons? This was a paradox we had to break, and that's what we set out to do.
So to do this, it required us to innovate in three specific areas. One, can you use technology, sensors, software, algorithms to see somebody walking through and tell if there is a weapon or personal items? Can you distinguish between a phone and a firearm? Concealed on a person, concealed in their bag? Two, can you do this very quickly? So as somebody's walking through the system, it needs to tell you they're clear, they're not clear. We can't wait 20 seconds until they're in the facility. It has to happen very quickly. And third, and very importantly, is the technology itself is not gonna stop a weapon from coming in. It's the people. It's the security operators that are gonna do that. However, in the U.S., the turnover of private security is about two to three times a year.
So there are a very experienced group of security people, but by and large, they tend to have low tenure and not a tremendous amount of experience. So how can we use technology to augment their capabilities so that the system, the process, the technology, and the people and the process can detect and prevent weapons from going in? And so we use cameras and a whole host of sensor fusion to be able to better equip the security operator so that if somebody is coming through with a potential weapon, they can resolve that very quickly, and we'll show you that in a moment. So I'm gonna share a brief video. This is a video demo of the product. We actually have two products. The first product we launched in 2019 is called the Evolv Express. It's so people walk through it. They don't stop.
It's to identify concealed threats on a person. About a year ago, we had a number of customers that wanted to also more closely look at bags and do automated screening of bags, so we launched the Evolv eXpedite, which is a high-speed automated bag screening solution. You'll see both of those in here. So what you'll see is this is a demo that's set up. People are just walking through. They're not stopping. They're not taking their phones out and putting them in a little bowl. They're coming through one at a time. They can come through in groups. There's no need to meter them. You see the light stays green, and this is what they're carrying. So they've got phones and AirPods. This woman has a tablet, keys, a whole host of things. So the AI is differentiating the two.
Now you see somebody coming through, and there's a red light. So you're gonna see what happened to this gray gentleman. There's three things that happen. One is there's a red light on the back of the machine. So for situational awareness, security operators should not be looking down but looking up at people coming in. He sees a red light. Second, there's an audio signal, a beep. And then third, on this tablet, each of these tablets, you'll see there's a picture of that individual and a location where that threat came through. So instantly, the security team knows somebody came through. They may have a threat. Let me resolve that. And the process that's typically used is they'll be sent over to a secondary location. This individual looks at the person. He sees the tablet.
He says, "Oh, something on the left side." So you see a red box on the left side. He knew something's on the left side. It's not his phone. So we'll ask him there. And here he has another firearm. Now he tags it. He just hit firearm here. That does two things. One, it can trigger a notification. It can go to a security operations center. It can go to a supervisor. It can go to somebody else that can help out or needs to know, if possible. And secondly, it tracks that. It creates the data so that they know in the future that on this day, at this time, somebody came through with a firearm.
That helps them as they understand their security operation, what's happening, where is it happening, validating the effectiveness and use of the technology. That's the Express system. This is now the eXpedite system. So these are paired together in this case. People are walking through, dropping their bags on. So this is about 2-3 times faster than a traditional X-ray. It's green. As you can see, there's no screen with an X-ray image for somebody to look at. It's the machine, the AI is doing the work. It's true AI operating here. So every bag's being screened, and it's being cleared, and it stays green, and people move on their way. And what you'll see here is all the kinds of things they have in it.
So these are full bags, like you might see going into an office building with laptops and chargers and, and, power banks and a whole host of different things here. Now, as you see them coming through, again, red. So in this case, red on the bottom. The machine stopped. The belt stopped. So you'll see how they do a secondary resolution here. Bag is taken to secondary. The security operator looks at it. He's trying to find out what it is. Here he takes out a laptop. He knows laptops are not gonna alarm on this. Very unlikely. So let me keep looking. In this case, there's the firearm. And there's a range of weapons. You'll see here an explosive device, not too different than what was in the MTA tunnels a few years ago in New York City. And then finally, this system is not isolated.
A lot more traditional metal detectors, they're analog and isolated. They're not connected to the broader network. Security operations is a more broadly connected ecosystem of technologies. So we have connectivity in, and one of the things we are enabling is the ability for a guard to basically have a panic button, have an ability to call for help, and you'll see that right here. So people are coming through in this case. Security operator's saying, "Please wait. There's a building crowd here." He wants to do something quietly, not as loudly, so he'll quickly hit supervisor needed. It can go to the SOC or mobile phone or many different devices. So what you see here is different technologies. They're using sensors, software, and AI to very rapidly collect that data and make a decision, red light, green light.
There's different sensitivities and settings that different security professionals can use based on what their specific threat scenario is or their specific security operational setup is. We have taken that approach, differentiate phones from firearms, do it very quickly, and help the operator, and apply it to these two products there. So as we look at where this can go, we think there's about a $20 billion TAM. If you think about the U.S. and international, it tends to be in places where people are going, lots of people go, and they wanna screen for weapons and threats, places where they've burned themselves out: education, healthcare, sports and entertainment, industrial workplaces. Think about warehouses, distribution centers, factories. And then in cities themselves, so the various, the cities and environments that you see, in some of the cities, and we certainly have seen some of the violence there.
So there's a large opportunity for us to deploy this technology there. To date, we have about 1,000 customers, largely in the U.S. across these different verticals. It started with sports and entertainment, where there's a strong need for that, lots of people coming in and screening for weapons. Coming out of COVID, schools were a growing market for us. Kids were bringing guns into schools. So there's two different scenarios. There's the Uvalde scenario or the Covenant scenario, which is a very intentional shooting, but more often, kids are just bringing guns in, whether they're intending to do harm or not. They're in their waistband. They're in their bag. So schools are finding these guns, and we're deploying across a number of schools now. Hospitals have the highest incidence of workplace violence.
To our nurses, our teachers, our healthcare providers, there's all kinds of weapons that are going into these hospitals. So typically, we'll see an emergency department and a main lobby or a visitor entrance where we deploy there. Casinos at many different tourist locations and workplaces that I mentioned. So if I just summarize here, there is an opportunity to transform screening in many different places out there. Our technology is helping people do a fundamentally different way of screening. This is happening again in the U.S. There's opportunities, globally for this. There is a group of customers we have, which includes some of the most iconic sports venues, tourist locations, hospitals that are very discerning customers. They test and know screening and security technology very well. So over the last five or six years, we have gone through testing with them.
They've deployed our system, and they're, they're using it, every day. One of the things that we did early on was we recognized that the threat changes. I talked at the start about the threat when we started the company around Al-Qaeda. That's different today. There's ghost guns today, for example. So what we have built is a model that for our customers will change with the changing threats. So we have hardware, our sensors, and we enable it with a SaaS model. So on a regular basis, we will update the algorithms, update software, update the capabilities. Again, as ghost guns came out, we tested the ghost guns. We updated the algorithm and then sent it out to our customers. And we've wrapped a business model around that, which is an annual cost, so an annual fee for software updates, service, maintenance.
So it's very predictable for our customers as well. They know it's a dynamic environment. We've built technology that can change with it and then wrap the business model around it to do that. Okay. With that, happy to take any questions. I'm gonna invite Brian Norris from our finance team up here.
All right. Thank you, Anil. We'll move into the Q& A portion if anybody has any questions to start. Or I can get us started.
There was a question.
Oh, go ahead.
Maybe an obvious question. What is the probability of false positives?
Yep.
In your test?
Yep. So there's a range of, of settings on the system depending on what a customer wants to detect. And there's also different, they call it stream of, stream of commerce, basically, things that are going through. So depending on those two factors, that will drive the, the alarm rate. We, we don't think about it as false alarms. We think about it as nuisance alarms. And the reason I make the distinction is the things that are alarming have characteristics of, of weapons. And so today, the system can't differentiate the two clearly enough, so we'll default an alarm and let the secondary resolution take it. So it will range. It can be as low as the low single digits, up to sort of mid-teens. And again, it really depends on, on the environment that we're in.
So the way we think about it, though, is how many people were cleared, how many people everybody was screened, but if 95% of the people walk through and never stop, and we they look at 5% of them or 10% or whatever the number is, that's how that's a lot of the way we think about it.
And maybe just to add a little context to that, we screen about 3 million people every single day, which is very likely as many, if not more, than the TSA on any given day. And that firearm button that Anil showed you, that's getting clicked over 500 times a day by our customers. So, I'm sure many of those are just people that carry a gun or carry some other type of weapon as part of their normal course of action, but it's also likely that we've probably helped avert some tragedies along the way as well.
All right. Maybe at a high level, you touched on some events that precipitated a lot of adoption of changing screening procedures. But at a higher level, you know, is there anything that's changed in the market over the last few years that's helped accelerate adoption of your technologies, whether it's, you know, more trust in AI or more of these terrible events?
Yeah. So, I think a couple things. The events continue, unfortunately. We saw just yesterday in Canada, you know, the tragedy up in, up there at the school. It's unfortunate, but they're happening. And so people are trying to find solutions or ways to address it. The traditional approach was traditional. It was a walkthrough metal detector. That was literally the state of the art. The first walkthrough metal detector, by the way, was deployed in 1926 in Germany. It's changed a little bit, but not fundamentally, enough. So that is what people knew. As they become aware of new ways to do it, where they can change the operational setup and let technology do more of the work, that has driven some adoption.
The second thing I would say is as more high-profile organizations have deployed advanced weapon screening like ours, it is they have a high bar, and they do a lot of testing, and that has given other commercial venues confidence. Some of them test. Some of them don't, but confidence that it's being used by some of the preeminent security teams in the commercial world out there. And I think the third is that this idea that we can have a system that's more effective, meaning the technology plus the operator and the process itself, 'cause that's what matters at the end of the day. Are they stopping weapons from getting into where they're prohibited? The thinking has evolved sort of in that way.
All right. I have another one. So with major events coming to the U.S., where you're primarily focused now, the World Cup, the 2028 Olympics, you're probably one of the few that they go to to ask about, you know, bringing your technology for these solutions. You know, how are they thinking differently about security and guest experience, and where does your approach fit into those conversations?
So there's regular events that happen every Sunday at a football stadium or even more frequently at a baseball stadium. Many times, they have a security team that's there every Sunday or every day for the game. So that team tends to get to be more experienced than their operational setup. These sort of infrequent global events have a lot of people coming. If they're international, there's language so questions around the ability to understand English and not English, so the ability for the security team to interact. There are security operators that get pulled in to ramp up the workforce. So we see these large organizations at events looking for something that's easier to deploy, easier to train on, can process a lot of people very quickly and do it as low a friction point as possible.
So, we're seeing more interest from these global events and these sort of short-term areas. They're also trying to add more layers, different layers of security. So if they can use a technology like ours to do screening efficiently with potentially even fewer guards in some instances and can redeploy some of their security workforce in other areas that need attention, that is, that's a win for them. I'm not sure if you would.
No, I think that's perfect.
Question for you. I just noticed that we've selected Plexus as a manufacturing partner.
Mm-hmm.
How do you plan to scale with them or without them? Where do you see the greatest potential for growth?
Yep. Yeah, for sure. So yes, great question. So the question around our contract manufacturing. So again, what our subject matter expertise is the technology. It's purpose-built technology and cloud and software that we've developed from the ground up. With regard to manufacturing, we've outsourced that since day one. We've used a contract manufacturer based in New England for all of our manufacturing to this date. We've recently, in November of last year, announced an additional agreement with Plexus.
Plexus provides us with global reach, global scale, economies of scale with regard to supply chain, gives us redundancy. There's about 20,000 workers in 26 locations for Plexus. So it's a significant, I'll call it scaling up opportunity. So, not that capacity was a concern previously, but this certainly increases our capabilities and our ability to scale much more effectively. Today, we have a dual-sourced approach there. We've told the market that we expect to be fully operational with Plexus in the second half of 2026, and we stand by that comment.
Okay. So you during the video, you showed, you know, the operator pushing buttons, and you said it's collecting data. So, it's a very interesting aspect of your technology and your solution. How are customers and your company using that data to improve operations?
Mm-hmm.
Safety? And if you have any examples, that'd be great.
Yeah. So the system itself has the CPU and everything built into it. So it does not require any cloud connectivity, any capability outside of it to operate, to do detection. That's very important so that it will operate and do the detection there at the site. However, we recognize that this is one layer of security that's part of a broader multilayered approach and a security ecosystem. So we have built a mobile modem built into it, and we will push data or alerts up to it. And so, some of the data includes how many people are going through the system at short intervals so that in a stadium, for example, they can understand their arrival curve.
And maybe the arrival curve at Gate A is different than the arrival curve at Gate C because Gate A is the parking and Gate C is the subway that's letting off there. And then maybe over time on rainy days versus sunny days, the arrival curve's different. And so some of our customers are using that data to better staff and plan staffing. And it's not necessarily that they cut staff, but can they redeploy staff in different areas at different times? So that's one area to do it. As you saw in there, if the customer verifies there's a firearm, that was what the button was. And when Brian talked about 500 guns being verified by our customers a day being detected, they capture that information. They may wanna see if there's an increase at a certain period of time.
Is a Saturday more than a Tuesday, for example? And they use it to justify the system. So one of the challenges with traditional security technologies, you don't know how many times things were being detected unless you literally have clipboards and keep track of it. And so this provides a package of information for sort of day-to-day operational planning and for more sort of annual, you know, how is this working and how are we using it? And then finally, we have APIs so we can integrate. So it's not just the data, but those alerts can be pushed to an emergency notification system or an incident notification system because this is part of a broader ecosystem.
If I could just maybe add to that for one minute to again, how does a customer engage with us? We enter into four-year non-cancelable contracts with our customers. So we have a really good. We have a very strong relationship that generally expands over time with our, our customers. We know a lot about their visitor data. We're also able to learn from that data set. So Anil talked a few minutes ago about the addressable market. We believe there's about 700,000 entrances that our technology can sit in. We're a leader in this space. We have about 7,500 units deployed. The reason I'm saying that to you, number one, to point out the penetration rate in this market is extraordinarily low.
But moreover, the network effect of the 1,000+ customers that we have, our technology, our product offering gets stronger over time by the learnings that we have with these 1,000 customers, with these 7,500 units deployed. And so the real power of what Anil is saying is, "I've learned I've detected a new weapon at this location for this customer.
I can now leverage that learning into our AI platform so that it's now benefiting 1,000 customers." So that's another incremental value of the large install base that we have, the number of weapons that we find, the people that we screen, the size of our customer base and the network effect thereof. So, the power of a long-term subscription. This is a hardware-enabled SaaS business. The hardware is important. The software is critically important to the operation of that because it's so intricately tied to the data set itself. Please.
[audio distortion] in terms of the growth, I guess, manufacturing or, you know, customer awareness, customer, you know, competition? What?
Sure. So the question is around constraints of or constraints in growth long-term?
You.
Thoughts?
Your perspective, and I'll share.
Yeah. So I really think it's more around awareness. I mean, again, this is not supply chain constrained. This is not that there's not a problem that we're solving. This is a matter of getting the word out, getting people to understand that there's an alternative to technologies. And I'm using that word loosely. Metal detectors have been around for a long, long time. Customers could have turned to that solution decades ago, frankly. And there's a reason that they didn't. So for us, a lot of this is around, not only awareness. Generally, our customers and prospects are piloting the solution in their environment, right? Nobody's buying this off the internet or placing an order without generally testing it. So there's a sales cycle to that process. And so, we had significant growth in 2024 and 2025.
We've shared some goals with the street as well. So I think a lot of it is gonna continue to be around awareness of the technology and awareness of this as a solution set. I don't know if you have a different view on that.
No, I think that's exactly right. I would just add one other piece. Because it's such a different approach.
Mm-hmm.
than what they're used to, they need to think about what the operational implications of that are. And so we have both a team, but then we have content, information, thought leadership we share with them on, you know, how to use it, how others are using it. It's very important that they make their own decisions in terms of how, how they're using it. It's their decision on security. And then we encourage our customers and prospects to talk to one another.
Right.
It's very important. These are former law enforcement people largely that have decades in law enforcement, that have a lot of trust, and they will trust their colleagues from their former law enforcement agency very strongly. And they, that is a very strong benefit if they're talking to one another.
I've got one more. As you look over the next few years, what are you most excited about in terms of your growth opportunity, and how the platform continues to expand?
Yeah. So, Brian mentioned it. We think there's about 700,000 entrances. We have, as he mentioned, a very small fraction of those. They're experiencing either actual events around violence or events close enough that they have concern.
Mm-hmm.
So there's a lot of good we can do. There's a lot of good we can do. So I'm, I've been with the company since the start, 12 or 13, almost 13 years now. I am excited about the opportunity to take the technology, take our team, and take our customers that talk about how they use us and continue to help make the world safer. I mean, it's literally why we started the company. And there's more work to do. Every time we see something like I saw this morning in Canada, it hurts. It, you feel like that shouldn't happen. It's tragic, but it is happening. And how can we help more? And so I think there's a lot more work we can do and we need to do, because I don't want my kids and their kids.
Mm-hmm.
Growing up in this environment that I've lived in the last 15 years.
All right. There's no other questions.
Yeah.
We'll wrap up.
There's a couple in the back.
[audio distortion]
Yeah. Sure. So, international. So, we do not have a monopoly here in the United States around gun or gun violence or weapons in general. The problem set might be a little bit different. Maybe other theaters are looking for bladed weapons or they're looking for, you know, personal explosives, things like that. But we could be helpful in all those theaters. About, certainly less than 10% of the company's business today is internationally. And that's been really our keen focus has been here in the U.S. We have a gun violence epidemic in this country. There's about 440 million guns in this in this country. And there's about 335 million people. But moreover, there's hundreds, hundreds of, mass casualty events occurring every year in this in this country, many of which you don't ever hear about. They're not reported on anymore. People become desensitized to it.
There's an enormous problem set here in the United States. That said, we have been investing internationally. We do have assets, folks in other countries, you know, including places like in the APAC and whatnot. We're protecting some of the most iconic venues internationally as well. So, it's not a matter of if. It's a matter of when we become even more of a presence internationally. I'm fully confident you're gonna continue to hear that going forward. It's a growth market for the company, unfortunately, but one we think we're well-positioned to go after.
Yeah. Maybe if I could just add to that.
Yeah.
What's consistent between the U.S. and virtually any international market is that threats are there. The negative events are happening. Too, the venues want to screen people with as little friction as possible, let them come right in. And they want to enable operators and that whole system to work well. So those are consistent truths, whether it's in the U.S. or in other countries. What's slightly different, as Brian mentioned, is the threats or the threat vectors might be slightly different. But that's part of the power we have is the ability to continue to increase and improve the algorithms over time. So the sensors and the data we get give us a lot of ability, not infinite ability, but a lot of ability to make those improvements.
Okay. I think that's it now. So we'll wrap here. Thank you, Anil. Thank you, Brian, for coming today. Very interesting.