Underground mapping specialist ProStar [TSXV:MAPS], which recently listed in Toronto, is on a roll, and demonstrating in the process the scalability of its technology. We have started covering the stock because we like its innovative technology and the fact that it is rapidly penetrating the engineering and construction market, a market we think is badly in need of this technology.
The latest deal is with KCI Engineering, one of the biggest subsurface utility engineering companies in North America. KCI will be using ProStar’s PointMan technology, which is a highly portable system for detecting underground pipes and cables far more accurately than existing processes, allowing access via existing mobile devices. This is not a piece of tech that has yet to be proven – it is already in use with construction firms and utilities and indeed at universities.
“Our client acquisitions to date have been Fortune 500 construction firms, [US] Department of Transportation agencies, and energy companies in both the US and Canada, but our recent product enhancements have been more geared towards engineering and surveying,” said Page Tucker, the President and CEO of ProStar Inc. “The feedback from some of the largest firms in the US and Canada is they cannot believe that a simple and easy to use application that runs on a standard mobile device delivers surveying levels of accuracy and improves cumbersome work- flow processes at such a low-cost.”
KCI is a big win for ProStar, although ProStar is already an established business with an impressive portfolio of client companies. The stock has only recently become available to private investors via its listing on the TSXV earlier this month.
Precision mapping technology can solve major issues
ProStar specialises in precision mapping solutions, leveraging a software-as-a-service (SaaS) model to support companies that need the precise location of sub-surface infrastructure. It recently signed a deal with the Colorado Department of Transportation that basically requires all the utility companies in Colorado and over 1000 utility installation stakeholders in the state to use PointMan as part of their operations.
Take a step back and repeat this not just across multiple US states but with other municipalities outside the US, and you can see how this business can quickly scale up. Being a software-driven SaaS model means that it won’t need huge factories or distribution networks. ProStar partners with other companies that like its technology – e.g. GPS technology specialist Trimble – which brings with it additional sales opportunities at government level.
We’ve said it before with ProStar and we’ll say it again – we were surprised at just how much money is wasted within construction by people drilling or digging through pipes and wires, not just in the US but globally. There is still an astonishing amount of guesswork going on for the 21st century. And ProStar is already getting that essential stamp of approval from some very serious entities.
Academic tie up
Earlier this month ProStar started an educational partnership program with Louisiana Tech University which will see its technology integrated into the university’s undergraduate and postgraduate engineering curriculums. LSU works with government and the private sector on something called the Trenchless Technology Center, looking at new ways to investigate what is already under the ground without having to dig trenches to find out.
“This is a great opportunity to further expand our reach and encourage adoption as we now get the brightest young engineering minds familiar with our solutions before they enter the workforce,” explains Ben Skogen, Project Manager of PointMan at ProStar.
He also confirmed the company has received expressions of interest from other universities in both the US and in Europe for a similar arrangement.