Axon Enterprise (Deep Dive)
A 30-year mission to protect life, and how it plans to continue
Axon Enterprise is a business I’ve loved for a long time. I’ve listened to countless interviews of the management team and have been very impressed by their mission and progress in the 30+ years the company has been in business.
Axon is the leading provider of public safety technology, yet remains far from a household name despite serving 95% of all U.S. law enforcement agencies. Its products, however, are definitely familiar to most of you.
The TASER was first developed and commercialised by Axon. In fact the company was previously named TASER International before changing its name to Axon in 2017. It also pioneered the widespread deployment of body-worn cameras, which are now standard issue across American police departments.
Today, Axon sells far more than just Taser’s and body-worn cameras. It has built a vertically integrated, recurring revenue ecosystem that combines connected hardware with cloud software running on long-term contracts with law enforcement agencies around the world.
The business model is genius. Every Taser or body-worn camera sold pulls in multi-year cloud subscriptions through its “Axon Cloud” suite (evidence management, records, dispatch, training). It’s the typical razor and blade setup where each device sold locks in software revenue for years.
A large segment of its sales are now recurring or subscription-based, and gross margins continue to expand as software becomes a larger slice of the pie that was once dominated by hardware sales.
Its founder, Rick Smith remains in charge and has ~5% ownership of the business. He has a vision that extends far beyond law enforcement into drones, robotic integration, and even civilian self-defence applications. He has a singular mission: Protect Life. So far, his track record of execution speaks for itself.
Table of Contents
Company History
Value Proposition
Business Model
Product Offerings
Moats & Differentiation
Market Context & Industry Positioning
Competitive Landscape
Financials
Ownership & Management
Valuation
Catalysts & Outlook
Bull and Bear Case
GabGrowth Quality Score
Concluding Thoughts (What I am personally doing)