Summary
- Intrusion has filed to raise $10 million in an IPO.
- The firm provides government agencies and enterprises with cybersecurity information.
- INTZ is seeking to expand its product line and broaden its customer base with the IPO's proceeds.
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Quick Take
Intrusion (OTCQB:INTZ) has filed to raise $10 million in a Nasdaq IPO of its common stock, according to an S-1 registration statement.
The firm provides cybersecurity products and services to U.S. government agencies and enterprises.
INTZ is a tiny firm that appears to have been negatively impacted by the Covid-19 pandemic but seeks to broaden its customer base with a new intrusion detection product.
I’ll provide an update when we learn more about the IPO from management.
Company and Technology
Richardson, Texas-based Intrusion was founded to develop a database of global IP addresses and related information for monitoring cyber threat sources.
Management is headed by president and Chief Executive Officer Mr. Jack Blount, who has been with the firm since May 2020 and was previously CIO in the U.S. federal government and founder of a strategic consultancy for various organizations.
The company’s primary offerings include:
- TraceCop - IP database
- Savant - Network data mining
- Shield - Intrusion detection (in development)
Intrusion has received at least $58 million from investors including ARS Investment Partners, Patsy Paxton, Michael Paxton, Julie Paxton Puckett and Mark Paxton. The Paxtons collectively own 50.2% of company stock pre-IPO.
Customer Acquisition
The firm markets its products through an in-house direct sales force and through value-added reseller organizations.
Intrusion counts as customers a variety of 'U.S. Federal government entities, state and local government entities, large and diverse conglomerates, manufacturing entities, and other customers.'
Sales & Marketing expenses as a percentage of total revenue have fluctuated as revenues have varied, as the figures below indicate:
| Sales & Marketing | Expenses vs. Revenue |
| Period | Percentage |
| Six Mos. Ended June 30, 2020 | 28.8% |
| 2019 | 9.5% |
| 2018 | 15.6% |
Source: Company registration statement
The Sales & Marketing efficiency rate, defined as how many dollars of additional new revenue are generated by each dollar of Sales & Marketing spend, dropped to a negative (3.8x) in the most recent reporting period, as shown in the table below:
