Telular is our largest investment and our best risk-adjusted investment since CAM Commerce (bought out in 2008 after going up nearly four times for our fund). Telular’s main product, Telguard, allows homes to have wireless alarm systems. Telguard is a cellular based device that connects to a home alarm system and communicates with the alarm company wirelessly. Telular sells both the product and the back end service to alarm dealers. The dealers then add it on to their service to homeowners. Telular gets paid from the alarm dealer $4 to $5 every month for each subscriber, amounting in a fantastic recurring revenue stream.

There are two main reasons you would want a wirelessly armed home alarm. The first is that you would want back-up security in case the landline was cut or disarmed. The second and more important reason is that many homes now do not have a landline. More and more people are only using a cell phone and getting rid of their landline, which is an important trend and macro tailwind for Telular.