Investing in Maritime Domain Awareness in a Changing World - Simon Tucker of SRT Marine

How does someone that started life selling chocolate mousse next to a Brixton brothel, followed by operating a cigarette vending round in West Ken Supermare, end up building national surveillance systems for sovereign governments across the Gulf and Southeast Asia? In this episode, I'm joined by Julian Collett of Blackdown Partners to talk with Simon Tucker, the founder and CEO of SRT Marine, for an unusually candid tour of one of the A market's more remarkable stories. Simon traces his journey from the acquisition of a forgotten pile of wireless-based intellectual property in 2002 through the pivot from selling AIS ship tracking transponders to delivering complete maritime domain awareness systems, and a position today where his company has been awarded over half a billion pounds worth of signed contracts and has 1.

8 billion pounds of forward sales pipeline. I'm Jeremy McEwen, and this is In the Company of Mavericks, a podcast where we help serious active investors navigate market volatility, protect capital, and uncover new ways to confidently grow wealth in these radically uncertain times. However, what you're about to hear is not any kind of advice, but just for your information and hopefully your entertainment. I'm not your advisor.

You should take responsibility for the decisions you take about your wealth. Please enjoy my conversation with Simon Tucker of SRT Marine. Brought to you by Progressive Equity Simon, thank you so much for joining us to talk about SRT Marine. Could we just start a bit about your background and the genesis of the company?

What problem are you looking to solve, and how has the business evolved over time? I'll give you a bit of the history on how we've got to where we are today first, and then the problem we're solving. I started at university, did international studies and economics. Basically, it was about what's happening around the world.

I was super interested in the dynamics of what's happening in the Southeast China Sea with the nine-dot line and all these different things. And my first job, which I saw advertised in The Times at the end of my finals, was as a trainee ship broker, and I thought, "Well, that's fantastic. It's shipping and it's gonna... round the world."

And I had this vision that I'd be controlling ships going around the world. So I had this sort of interview on Wednesday, and I had two weeks of partying planned at my finals, and I was told by the company, "Can you start Monday?" So I packed up my stuff, canceled the parties, went to London, found somewhere to stay, bought a cheap suit on the Sunday and turned up for work on the Monday morning, and was basically then told to make coffee, deliver telexes to the ship brokers. Nothing like as fancy and exciting as I thought.

After about eight weeks of that, I thought, "Well, this is not really what I thought, and I don't like being told what to do. I want to work for myself." So I quit without thinking I didn't have any money. I was living in Brixton at the time.

I couldn't pay the rent. But apparently, I'd been told I could make chocolate mousse quite well, so I started to make chocolate mousse and sell it to the delis, and that was quite good until I sold it to Harrods, and their health and safety came and knocked on the door and said, "Is this the Real London Mousse Company?" I said yes, and they said, "Well, this is Harrods. We're canceling all our orders."

Because it was, like, on the second floor next to a brothel, next to a drug den. There was raw eggs, rusty refrigerators, my Citroën with the wheels off it in case they got stolen. Anyway, so that's how I started, and I then met somebody who was selling a cigarette vending business from their main business. And there was a few drinks at the party, and he agreed to lend me the money to buy his business, and I was given the keys to a cigarette vending business in Weston-super-Mare.

I didn't smoke, and I didn't really know what Benson and Hedges were like. And the following morning, these three guys that worked at the company turned up and they said, "Right, we're ready to go out and service these vending machines. Where are our vans?" I said, "What are you talking about?

Don't you have your own vans?" He says, "No, no, we - The company provides the vans." I thought, "Blimey, I hadn't thought about that." So I went down to the local Vauxhall garage and persuaded them that we wanted to try these Astra vans for a month, and then we might buy 100 of them.

So they lent me the vans for a month, and off we went. And by the end of the month, I was able to then lease the vans, and I built that up and we sold that to TM Group. I then got into audiovisual systems and internet and things like that. And I had an internet business in the dot-com era, which I was gonna float for tens of millions.

Then the crash came and the demise of that business as well, and it was the equivalent of AutoTrader at the time. During that time, I was trying to sell that business to a Guardian Media Group, actually, which I failed to do. When I was on the train, this is now summer 2002, going from Bristol to London There was a chap in front of me chatting, upset that Securicor, the security company, as we now know, the blue trucks, was selling this company called SWT, Securicor Wireless Technology.

And the chap that was talking, I shouldn't mention his name, was complaining that they were selling this business, and it was a great business, for a whole two hours while we were on the train going to Paddington. And I don't like people that complain. Either stop complaining, put up with it, or do something about it. By the way, stop complaining.

So on the platform, I tapped him on the shoulder and said, "Look, I'm listening to your conversation. It sounds really interesting." Bearing in mind my business had just gone wrong, so anything sounded interesting. I needed to make a living again, and I was now in my early 30s.

And he said, "You know, what do I do about it?" And I said, "Well, why don't you buy it?" And he said, "Well, I haven't got any money." I said, "I might be able to help with that."

Exchanged cards, didn't think anything of it. Following day, he called me, and he said, "You know, I'm the guy that you met on the train. Were you serious?" I said, "Yeah, I was serious."

So anyway, I went down to Somerset, to Somerton, to this building which had Securicor Wireless Technology written on it, and I opened the door- And there were three boffins in there beavering away on some technology. But what I saw was this sort of stock of intellectual property that had been developed by this company called Secure Core Wireless for its parent company, but also by anybody else that wanted to, in those days, develop a bit of wireless technology. So car-to-trackside, Formula One telemetry was developed by SWT.

Satellite communication transceivers for Marconi, all sorts of stuff. And I thought, "Well, if all this IPR was sitting in this company and I could get it cheaply, I could then go and flog it around the world, and there's two or three engineers there that could sort of package it up." Anyway, long story short, I eventually persuaded Secure Core Wireless Technology to sell it to me at a fraction of what they'd been looking for, and I paid five hundred and thirty-five thousand pounds for it, and the following day sold the building for five hundred and fifty thousand pounds.

So we had a little bit of working capital, and I had some help from some investors, two of whom are still in the business today. And we embarked on this idea that we would now take this technology and sell it, and it would all be great. What I didn't realize is if I've created technology for one company, the fact that the application is the same in another company doesn't mean they can buy it exactly the same. You have to curate it and modify it, a bit like a suit.

The fact that the suit fits me doesn't necessarily mean it'll fit you, and at some point, we may as well have just developed a new suit for you. And that was the case for technology. So that idea didn't work. So I thought, "Well, that's, that's a drawback 'cause we can't sell it."

But one of the contracts we had that was still ongoing was with Saab, and it was for a thing called an AIS transponder, which is a tracking box that goes on ships. And if you go onto Marine Traffic today, each one of those boats that you see on that screen, a little sort of triangle going around, has an AIS transponder on it. And Saab was the first people to develop that. But actually, SWT developed it.

And so we were carrying on with that business, and they were the only people paying us, and we also had another project which was to develop walkie-talkies. The walkie-talkie business didn't work. We tried to do that, and we licensed to China and places like that. We were the first people to license there, and then they stopped paying, and that was a bit of a disaster.

But we kept going with this funny little AIS business. And then we thought, "Instead of licensing our technology, why don't we make the PCAs, the electronic boards, and sell them? And then why don't we make the product?" So we started to make these AIS transponders and sell them all around the world to Raymarine, to JRC, Transas, companies you've never heard of.

And we started to build our business up, and we started to see that just like with airplanes, people wanted to track what's going on in the ocean. But the driver for AIS was about anti-collision, but the real interest in the driver was tracking. It's like with the mobile phone, it wasn't invented to text and browse and scroll and everything else. Today, calling anybody is an odd thing.

You're an old person if you call people. The use case evolves. I was reading about AIS transponders, I think only a couple of days ago, in relation to what's going on in the Gulf, and that there's a Reuters article talking about how there's a increased prevalence for tankers of all nations now to turn the AIS transponders off as they're going through. The article was suggesting that the measures of the number of tankers going through the strait are potentially misleading.

So what happened is that AIS is mandated by the International Maritime Organization on any ship in international waters over three hundred tons. So there's thirty million boats in the world, so you'd think there's millions of those, but actually, there's only about a hundred and fifty thousand of ships over three hundred tons on international voyages. And that is in the domain of the International Maritime Organization. And you are supposed to have an active AIS transponder to prevent collisions for safety.

Not for tracking, for safety. Okay. You are allowed to switch them off if you feel it puts you in danger. So if you're going near the Horn of Africa, the last thing you want to be doing is transmitting to everybody, including the Somali pirates, who also have iPhones, so you switch them off.

Or if you're in the military, you put them into encryption mode. A lot of vessels switch them off all over the place. And so this binary thing of it going dark and it can't be seen on VesselTrack or MarineTraffic or any of the public sites, which means that the transmissions are not making it to the satellites, does not indicate that there isn't traffic. So if I look at Hormuz, where we have a lot of customers in the GCC building the next generation of surveillance systems, I can tell you that probably for every one tanker you see there, there's probably five other boats that are unseen going around in that area.

And you use different methods like radar, infrared, optical imagery to be able to see that. So that's the difference between a professional system and a sort of commercial system. So Reuters is right. There's a lot of stuff that you don't see on a public website that's going on.

There's a lot more traffic than one thinks going through, and we can see that on these systems. Just before we go on and talk about some of the wider sort of macro stuff, finish off on the journey to SRT today. So you've become a products company in the maritime space. When was this, and how have you evolved from that point?

So we started selling these AIS transponders, and one day we had a call from the US Coast Guard, and they said they'd like 11,000. We'd been selling like 50 or 100, so it was quite an exciting phone call. And we followed that up. We sold them 11,000, and it was to give to Mexico to put on all the drug boats.

And I thought, "Well, that's not very bright, because if I'm smuggling drugs, I'm not gonna put an AIS transponder on it." And the guy said, "Exactly. So now we'll see who the bad guy is, 'cause he's trying to hide. And if you're out having a glass of rosé or fishing or whatever, you don't mind putting a transponder on."

So I went down to Mazatlán expecting to see this big James Bond command center, and they're all monitoring. And actually, I found a guy with a pickup with a small laptop. And it seemed bizarre to me that you have air traffic control, you have integrated digital air traffic control. The UK alone has spent three billion on its NAT system.

And you have a few little port systems. You have nothing. And this was 2014. And so we decided, wouldn't it be cool if we had a piece of software that enabled you to track the AIS transponder you bought from us?

Maybe we'll sell more transponders. Right. And Bahrain said to us, "Do you know what? We would really like to have a national AIS tracking system now that you've got the software."

And we developed and delivered to them for $5 million, our first system contract in 2015. Never had a $5 million contract. Amazing vision for Bahrain to do that, and we went and implemented 7,000 transponders, this big command center, and they could see it on this big video. All fantastic.

And then we started to see, well, actually, they also wanna see people without the vessel transponders, 'cause that's the vast majority. And then now you're seeing hundreds of thousands of targets, most of whom are not doing anything bad. You want some analytics that'll tell you who's the bad guy And then digitally, how can I deal with that? And so our thinking progressed that, well, actually, countries, sovereigns want...

Like they have ATC, they want a national maritime domain awareness system. And here we are today, we've signed our first contract, $5 million. The next one was $40 million. The next one was $60 million.

Then it was $180 million. Then $220 million. Then earlier this year, $265 million. And so from sort of zero in 2015, we've signed 550 million pounds worth of contracts and built a forward pipeline of prospects of 1.

8 billion. And today we deliver, if you are a sovereign, a country, you will come to us and say, I wanna know what's happening in my maritime domain, and I want a system that tells me where I need to go and what's going on, so therefore I know do I need to send a boat with life jackets 'cause it's a ferry sinking or is it a smuggler and I need to send one with guns?" And we call that intelligence-led operations, and our system enables that, and it enables you to be efficient and effective.

And probably the leading thinker in this world today is a guy called Commodore Mubarak in Kuwait, who has that vision of this integrated maritime intelligence system and has contracted with us to go for gold. I mean, it is the best of the best of the best. And from their command centers, of which they've got several now, they can see everything. If you fall in the water, there's a camera that can see you and detect you and see that you're in trouble or not.

It's remarkable. And that's how we've got to where we are today, and now we're expanding with more countries now joining that, our sovereign partnership program, and them coming to us and say, "Do you know what? We'd like to extend that to include land borders and near air, so drones, and subsea." That's where we are today.

One quick question to clarify. How do you track somebody who doesn't want to be tracked? So it's super easy to track somebody with a transponder. Ninety-six percent of boats don't have one.

So the way we do that is you have different types of sensors that sit on different platforms. So you'll have a radar, you have cameras where you edge process the camera. I can do a shape detection of you in a camera at twenty kilometers, and I know it's a boat. You can use infrared.

You can use weight detection, radio frequency triangulation. And so our system has all these different sensors scattered around the place, either on towers, on boats, on USVs, on UAVs, and it all feeds into our brain. So our juice is the GeoVis brain, which sits in the customer's command center. It's not up in the cloud, it's their data.

And our brain extracts from that the targets. But then it might say, the camera saw this boat, the radar saw the same boat, the RF saw the same boat, and then we'll correlate that together and say, "That is all the same boat," even though it saw three targets, all in milliseconds. And so you have on the screen triangles, which will show you the tracked boats with a tracker, and then you'll have little round targets, and you'll see ten to one more of those, and those are the ones that have a tracker off or don't even have one.

So that's a great trajectory for a business. At what point did SRT become a public limited company? In two thousand and five. Okay, so early on.

we floated in two thousand and five when we knew that actually we could sell stuff and we needed capital. Public company, twenty-one years. The business model you've evolved into is systems-orientated, so you're combining hardware, software, and domain know-how. Where's the critical juice in all this?

What's the critical factor that makes you a special business when it comes to these solutions? It's an onion, and there's layers. I suppose right at the center of the onion is our software, our GeoVis software, which is a suite of software. It'd be like saying to Microsoft, "What's your USP?"

There's a suite of software which sits on Windows. So for us, there's a suite of software which we call GeoVis, and it sits on our GeoVis hub operating system, which amalgamates everything together. But around that comes the ability to design the hardware architecture that goes into somewhere like Kuwait, which has got fifty-five degrees on a warm summer's day, or in a monsoon and a typhoon in the Philippines or Indonesia. How to design ergonomic command centers that work from a ergonomics and operational standpoint and look great.

How do you deliver that into those environments? Picking the right sensors for the right places. Then outside of that, we've got data services that we provide those customers. We buy selected satellite data to augment their coverage, and we add value to that.

Outside of that, we've got to teach them how to transform from an analog organization to an intelligence-led operation which is fully digitized. So what we're doing is often some customers, we're taking them from a sort of 1970s style that's just typewriters on the desk to everyone's got an iPad, and you don't just sort of do that in five minutes. And so we have a training program which people pay for, which is profitable for us as a profitable revenue stream. I suppose the analogy is we're selling an airplane, but they want to run an airline, and we're teaching them how to run the airline.

And so all of that comes together, and if you're the customer, what you hear is, "Gosh, there's a complete solution that at the end of this, I sit down and I can go to that company and say, 'Okay, now I've got my initial system. Now I want to expand it, and I've got this problem to solve.'" So for example, in some of the GCC countries, they want to expand into land borders and drones, so they come to us because they want to integrate, and we just keep growing. So it's that expertise that then keeps growing.

And all of those bits form that onion, if you will, and the final layer is trust. We've been in it for years. We've never failed. We've had problems in every project.

Nothing is easy. These are challenging projects. We're trusted. We've got a such a strong brand.

In the Middle East, customers know you go to SRT. In Asia, they go to SRT. So it's overnight success after 20 years. You've got a impressive list of customers and a growing list of customers, and you say a very attractive forward pipeline, but they all seem to be countries that are in the emerging or developing world rather than, I don't know, established Western powers.

Why is that? What are the solutions that the UK or the US or other NATO countries use for what you're describing here? Well, when I did my degree, which was international studies with economics, it's quite interesting, the geopolitics. For the last 10 years, what I've seen is that this sort of globalization and West is best has gone, and places like the Middle East and Southeast Asia have grown in wealth, grown in confidence, highly educated, but they also have jeopardy, and they want to have independence.

And so there's this long-term global trend of wanting to have their own independent capabilities and not rely on the West. I don't think there is a country in the Middle East that thinks that anybody in the West would come and do what happened with the Iraq War with five hundred thousand people and things. I wonder what would happen in Southeast Asia if things kicked off,? So they want to look after themselves.

That combines with those parts of the world having real jeopardy, as we've seen. Stuff does happen. They need to stop smuggling. They need to stop all these things.

So they've had the greatest need, and they've had the money, and they want to be independent, and they're very fast adopters of technology. Not obviously everyone's that quick, but some are super quick. Kuwait is going for gold, and others are a little bit slower. In the West and in Europe, I think that until somebody cut off the internet across the Baltic, nobody really cared until somebody lost Wi-Fi in Helsinki, and that was all, "What do we need that for?"

The minute it lost Wi-Fi, it was like, "Well, we need to find out why that ship's dragging its anchor." We now have a war in Ukraine where we've seen awful things going on. I think we feel a bit of jeopardy, and NATO is, I wouldn't say struggling as an organization, its chips were down, but I think there is a feeling that we need to take our own defense a little bit more seriously, rightly so. And so oddly in SRT, having never had any real engagement with European countries, we've now started to see that.

So I think the jeopardy has not been there. You've got to have a need for our stuff. I mean, it's such a big thing. You know, it's not just buying a small system, plonking it on the White Cliffs of Dover.

It's changing the way you operate completely. It's a massive national decision, and so that takes time, but it seems to be coming to Europe now. That's interesting, isn't it? There is a pretty unsophisticated degree of monitoring in the US and, for example, the UK, isn't it?

It's not that they're without anything. I don't know the details, I'm pleased to say, and if I did, I probably wouldn't tell you. It's a different doctrine. It's not about persistent civil defense.

We have persistent civil defense in terms of police and surveillance on the land, but we've never really thought about it on the maritime borders. And so we have border force with a few boats- And the military do a little bit of surveillance. But we haven't had that persistence thing until we had boats coming across the channel, and look at the kerfuffle that's been. In a pretty small 100-kilometer length of coastline.

When you then think about Indonesia, which has got two million square kilometers- across which there are 19,000 islands and 600,000 boats, it's a different kettle of fish. So in Europe and the United States, we just haven't had that sort of jeopardy to have that persistent surveillance. But I think that's now starting to change, and we've seen stuff particularly around our subsea infrastructure and cables, which we're very reliant on, to be able to protect that. And to protect that, you can use the intelligence of our system that will look at patterns of behavior and things, and trajectories, and all this sort of stuff in relation to subsea infrastructure, and automatically generate alert and say, "There's no reason for that ship, which is saying it's destined for this port, to be going in this direction at that speed."

And in four hours, it's gonna be over the main fiber optic cable linking, let's say, Britain and Norway. Mm-hmm. So now you have time to go and intercept it before anything's happened. So what are the challenges posed by undersea surveillance compared with the legacy stuff on the surface?

It's dark and it's deep. Yes. For starters. Well, what you're doing is protecting what's under the sea.

'Cause to get there, you know, leaving aside some massive submarine, it is a ship that's gonna go over and it's gonna drag something along it. So what you need to be able to do is, first of all, is to have shipping lanes that route things away from that. And if ships are going near those areas, you need to have that advanced alerts, as I just mentioned. And that's a case of effective tracking and analytics.

And that is something that the GeoVis brain that we have does very well. So that's the first step. The next step is the more tricky stuff, which might be a submarine going towards a pipeline or a cable or whatever it might be. And under the sea, then that is sonar detection.

We have a nascent interest in the Middle East of using effectively sonar nets. So if you will, this sound going down From buoys on the surface, and it creates this sonar net, and if something goes through it, it pings. Now you know something has gone in that particular direction, and you can calculate where it is. Now you know something is there, you now need to deploy some kind of subsea drone to go and zero in on it and deal with it.

It's obviously challenging because, as I said at the beginning, it's dark and it's deep. But the real problem is locality. You just narrow down where you're gonna look at, and Britain and Europe have the assets to deploy, but you've got to know where that area of interest is. So how well looked after would you say the UK's undersea assets are?

I'm thinking things like power connectors and internet cables. I think they're very well looked after in terms of maintenance, but I don't think we really envisaged that it would come under threat in this way. I think the psychology was, well, if it's, you know, a thousand feet down under the water, it's safe. And now all of a sudden, these things have started to happen, and now people need to react to that.

, You don't go down to Tesco's and buy a cable protection kit. You need to change the way you operate, get the technology in. So I think that the protection of subsea infrastructure needs some pretty substantial improvement, but that's part of the change of an operational doctrine. Yeah.

Everything you said, and I totally get it. I think George Galloway said the days are now gone that seven point two billion people in the world are prepared to be told what to do by eight hundred million of us. I'm not a fan of Mr. Galloway, but I think he's right in that respect, and I think he's been proven to be more right as every day goes by.

But by the same token, if you're pitching your system to a Far Eastern government or government organization, aren't they likely to say, "Why should I use your system, Simon, if the Ministry of Defense aren't using it?" First of all, we don't go and sell to anybody. This is gonna sound rather arrogant. If you have to go and try and persuade a customer To have a maritime surveillance system, it will be a very, very, very long time before they make that decision.

So it would be typically as a Ministry of Interior and an agency within that, like a coastguard or something, or police service, will have already decided that they need to have that intelligence, and they will have decided that by meeting people in regional forums that now have them. For example, we signed a contract in an East African country, which I can't say publicly, and they referenced through the Djibouti group some people in the Middle East who said, "Well, actually what you need to do is to get an SRT system," and they came to us.

And so, A, there's no competition. Nobody's doing what we're doing today yet at a national scale where you can integrate everything. And B, the countries see what other people are doing, and they do it at their own pace. But there has to be the fundamental need.

It's not a nice-to-have. They have made the decision, "We need to have this for these reasons." Everybody's doing it at different paces. I mean, we have six sovereign partnerships today.

There are about 150 odd countries with a coastline, so we've got some way to go. How should investors look at SRT? What's the sort of peer group of comparators? I mean, you say just then that no one does what you do.

Try and help the listener here understand how they should think about your business. I think the best parallel would be Anduril, which isn't a public company. Anduril's an American company whose remit and whose strategy was to bring tech into defense to make defense smart. And rather than do R&D projects, they develop products that the defense industry could buy, and they can operate much more effectively and safely and more lethally.

We're doing the same, but in civil defense. That's the parallel. And so if you think about us as a company that will work with a country, let's say like Kuwait, and build up an integrated border surveillance and intelligence system that covers land, sea, and air and brings everything together and all that intelligence enables the police, the fire department, the ambulance, all the, the border guards all to work together efficiently and to act as a deterrent, and they build that up over time, that's what we're doing.

We're bringing tech, that intelligence. So I think Anduril would be a parallel to us, but in a different segment. Sounds like you're quite determined not to be classified as a defense company. You're making a clear distinction here between civil intelligence.

I guess the question I'm driving at here or the understanding I want to get is you're operating in a rapidly changing geopolitical landscape. You're securing long-term contracts with governments and government organizations in countries that over time their status relative to the US, for example, might have or could in the future change quite quickly. That must be a risk factor in trying to understand your company and its growth path. Yes.

I don't see it as a risk because we position ourselves as being completely independent. Our customer, buys our system and they operate the system locally on-prem. It's not in a cloud served up from Cambridge or Silicon Valley, and they can build it in a modular fashion, which is what they keep doing. And so, yes, geopolitics change.

In one minute the neighbors are friendly and the next minute they're throwing tomatoes over the fence But we supply both neighbors. It's a tool. And the reason I make the distinction between defense and civil defense is our stuff doesn't attach to a missile that blows something up. What we're trying to thwart is what happens 98% of the time in countries, because mostly they're not at war.

Mostly they're at peace. For all the kerfuffle over Dubai and the Middle East and everything else right now, the reality has been peaceful for 15, 20 years. And now there's one month of some missiles and drones going over, and it's in the news and stuff. But by and large, it's peaceful.

But it doesn't mean they have massive security concerns of drug smuggling, of weapon smuggling, of other illegal activities, law enforcement, all the day-to-day stuff. So the biggest requirement actually is civil defense, which sits alongside military. And military is there for when everything really does go Pete Tong, and you need the frigate and stuff, and you have four or five frigates. There's this gap that when we started in 2014, everyone thought we were idiots.

There is no market. What are you talking about? We thought differently, that there would be this market for civil defense, and here we go I want to tell you about a specialist financial training business called Finance Talking. I know the team there well.

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You'll find a link in the episode notes. If you contact them, tell them that Jeremy sent you. Now back to the episode. I've chatted to Amit Daniel of Windward a couple of times on here.

Amit, he told me last time that one of the motivating factors for taking Windward off the market was to create a US top co efficiently that enables him basically to transition what he described as a maritime intelligence business to being able to serve, tier one US defense contractors. So he seems to be aligning himself in the US camp But he made great virtue of the fact that he thought the AIM market had served him very well the first time we chatted to him on here, and then three months later, he was owned by private equity.

I suppose the wider question is you've had a good ride on the listed market. You've recently raised additional funding for your growth. You clearly need capital to take on these big contracts. You need a balance sheet.

How do you weigh up being a listed company in these quite challenging times, being a listed business versus other alternatives, shall we say? So Ami and Winwood, I mean, great character, great business, but very different. We've, in the past, have been sort of put together with them. They provide intelligence reports.

They will process the data and provide the report and insight that you buy. We're providing a tool, so it'd be a bit like if you want a letter written, you would ask me, "Can you write a letter?" And I'd write you the letter and give you the letter. SRT would give you the computer and the word processor and teach you to type.

Okay. That's the difference, and I think that he did very well to sell his business, and I wish him all the luck. I think that for me, being on the market, the first thing I would say is it has been tough because you're punished when you miss forecasts. You're under a lot of pressure to put forecasts on, to forecast what a government will do two years in advance.

I have difficulty forecasting what's gonna happen Monday, never mind two years in advance. But that is just the nature we're in. Most people who say they're long-term investors are not, and you get punished, and you have to face the music, and that's it. But it has given us access to capital and to meet people, and I'm not gonna name them here, but some pretty notable business people who understand what it takes to build a business who have invested substantial sums in us to enable us to build this enterprise-scale technology.

If you develop an app for that in six months, what's your competitive moat? You can't develop anything of any value in six months, a year. It's just not realistic in a business. But to develop at this scale, you need huge capital, and being on AIM and the stock market has given us that exposure, enabled us to engage with investors.

That's why I've made it my mission, really. Anybody that invests in SRT, whether it's one share or 100 million shares, come and see us. I've put a lot of effort and completely open and factual about when things go wrong, when they go right, and what have you, and that's given us the capital. So whilst it's hard, whilst it's tough, there's times where I have to put my tin hat on, and those days are gone now 'cause we've got forward contracts.

We're forecasting against contracted revenue. This is a game changer for us, which hasn't really been reflected I think or understood yet in the market widely because of our history, but also in the background. But that'll change in time. We're in no hurry.

So it gives us access to that capital. It gives us credibility. Your next question was really what happens from here. As we grow, our growth path is accelerating and steepening at a dramatic rate.

We now have a sort of five-year plan, which we've been working on for the last six months, which will see us go from where we are now at a 250 million valuation to a billion valuation. That might require additional capital, but it doesn't necessarily mean equity. We have different forms of financing available to us. There's loans, there's leasing, there's asset financing.

There's a blend of financing that's available as we become much more sophisticated. We have Jules on this thing here helping us with all of that And so it's got us to where we are, and I don't see any hurry in coming off. I think people can join the party by easily buying shares, and then if they suddenly wanna buy a car, can sell them. I watched the webinar that you did most recently.

I watched the recording of it in the last few days, It looked like just solo you were there telling your investors what was going on and answering questions in real time in a very straightforward way, and I think that there was a massive kudos for being honest and straightforward, so well done you. It follows through to the AGM as well. So we invite people down to the AGM. We have an investors' open day.

The problem I think often today is everything's so curated. You've gotta manage this, manage that, manage the... If you're a real business person, you know there's ups and downs and there's problems, and no business grows at eight percent a year. There's always problems, and so people come to the business and they can meet all the managers in the business and see actually Simon's sadly now is a little bit incidental to the success of SRT.

That juggernaut is rolling, and there's a hundred and eighty people, there's senior management people, there's succession planning, there's all that sort of stuff, and you can see the caliber of the people we've got. And all the SRT people that are involved in that, no one is given a script. Tell 'em how it is. Well, you've answered my next question, but I'd like to, to hear a bit more on that front in terms of how the business continues after Simon Tucker.

I... what the succession planning is, what the board offers you, well, let's start with the board. We have a very strong-minded board. A couple of them have got significant shareholdings, but it doesn't mean they're not independent, and they are very challenging to the management team.

And it's very important to have people with their own minds that don't need the money, that aren't professional NEDs, if you don't mind me saying. I know that's a slightly controversial statement. No, I think there's perfect reason. Because they have their own minds, they're not frightened to say, "Well, I think that's a terrible idea, and by the way, we're not doing it."

And I think the other thing that we've always done in SRT is we're very strict on that division of responsibilities between financial control and operations. And the CFO, Richard, is fully independent, and he has an NED that is hooked to him. It's not just a case of, you know, the CFO, "I think it's a really good idea if everybody has a Ferrari. Let's go and buy one."

We have that governance in SRT, and that has made us stop and think carefully about doing things. At one stage, we were gonna have our own satellite constellation. When we were just about to sign the contract, and we really looked at the figures in the market and decided, "You know what? Everybody's doing that."

The price of data's coming down. The last thing we wanna do is have our own, so we didn't do it. In terms of structure and succession, obviously, when we started with three people in 2002, we were a little bit more reliant on each other. Today, probably 300 people by the end of next year, we have a proper structure.

We have proper management, each with their own roles in product management, development, delivery, logistics, administration, finance. We have a sales development team with a number of people out doing sales development. The reason it's quite associated with me is, 'cause of wonderful programs like you, you hear me all the time, which is why it's sort of synonymous with me. But in reality, if I went on a sabbatical for six months, it's not gonna stop.

For example, next week I'm in a country for a new customer. Actually, it's one of our sales business development people that is leading that. It's not me. And that customer has come to us, to Simon.

So your role has changed dramatically over this sort of long arc of SRT's time on the listed market. Massively. How many direct reports do you have, and how excited are you about getting up out of bed every day compared to 2005, let's say? Well, I'm always excited to get up out of bed, and at my age of 56, I'm super happy these days 'cause it means I've woken up.

So I have- It gets more... As years on, it gets more exciting. Brilliant. "I'm still here."

No, but seriously, it's super exciting. I've always had a sort of, "Let's get going, let's get going." Yeah. I've got seven reports to me.

Okay. We've all got the same passion. We were having a management meeting yesterday, and it's just awash in opportunity. But I believe in a lot of delegation, and people have ownership with a smattering of micromanagement, is my style.

So you own your area. We, for example- You're slightly a control freak. Is that what you're telling me? Yes.

Oh, absolutely. Yeah. So the ring- the phone's gotta be w- answered in five rings. I'm just as- Okay wound up about that as a cost overrun on something else, and that's maybe a personality disorder.

But the detail matters. But if you take, for example, we've got our delivery department for systems, a guy called David, who's ex-military SBS, amazing guy, built military camps and stuff, and he's looking after that. He clearly owns the delivery of our system projects across the world, and he's delivering six of those today. But I can tell you the detail of all of those, and I will attend ad hoc meetings 'cause I need to see overall what's going on, and I see it as my job is to continually lift and drive the quality of everything as much as I can and look strategically.

Like, for example, we've got customers that now want us to supply them with drone detection and tracking systems for land borders and things, or subsea detection systems, to then have that conversation with product management and direct them strategically. So I'm much more now around the strategy than the day-to-day operations, but I'm still in there. So we have a very flat and lean but solid management in the business. So apart from the phone ringing more than five times, what really worries you on a day-to-day basis, or what keeps you awake at night?

That we're doing as good as we possibly can. If I'm honest, I worry about what I don't know. We've lucked out. I never thought when we were making transponders we'd end up doing a contract for Bahrain.

I came back from Kuwait this week, and we're doing the most amazing things there and building the most amazing system. I never thought that would happen. And so I always think, well, you know, is somebody else trying to steal our cheese and buried away in the basement developing stuff? Thus far, that's not happened.

So that pushes. I'm paranoid the whole time. You know, we've got to push, push, push, so it's the first thing I think about in the morning anyway So on the sort of macro geopolitical scene, we talked about this earlier, but obviously things are changing pretty quickly. It's a bit of a double-edged sword, someone serving the customers you serve, but obviously somewhere like Kuwait, it's a massive win.

It's a great reference customer, I would imagine, for growing your business. But it's also a country that, not for the first time in recent decades, is suffering some form of jeopardy. How much time are you looking at and thinking about where to go next, which phone call to answer, which email to answer, and which one to sort of kick down the road a bit because you're not quite so sure what's at stake? You don't sound like you're worrying about those big picture things.

We worry about our existing customers first and foremost. We call this thing a sovereign partnership, and we mean it. So when things kicked off recently in Kuwait, we stood closer to that customer. We didn't move away and say, "We're supporting you, but on a video call."

We're there with that customer. We wanna make sure their system is working for them, so it's available to them. And so we look after our existing customers. They are a particularly demanding customer and particularly educated and sophisticated customer, and when that comes together, it equals massive challenge.

But that drives our business forward. And yes, it is the ultimate reference, despite also being the ultimate challenge. And I must say that is quite remarkable what Commodore Mubarak is achieving. We then do have that problem where you then start to get other inquiries all the time, and we're no shortage of inquiries.

But I suppose what you're asking is who's serious and who isn't, and who's just a bit interested? We're quite difficult to deal with, frankly. So we get a lot of inquiries, and you'll get a response immediately from us, from one of our salespeople, and you'll get some information. But we won't rush over and see you.

I've got that T-shirt years ago, and I've been to places like Madagascar and Ecuador and all over, And a lot of places weren't ready. They don't have the money. They don't have the thinking. Perhaps they have the aspiration.

And so that's where we have this VSP concept, a validated sales pipeline. 'Cause otherwise, for salespeople, it's always the new shiny thing that you rush off to. The hard grind of making things happen. And our projects are hard.

Takes years to consult with the customer to get to a project. It's not just like selling a pen. We then monitor and see how do they come back? Are they engaged?

What sort of questions they are. And it's a bit of a judgment, which is, do you know what? They are serious. It's worth going and spending the time.

And then you very quickly see once you get to proposals, you start involved with their finance ministries. If it's a real project, there's lots of people in ministries involved. It's a very public process. It's really at that point it starts to get serious.

It gets on our validated sales pipeline once there are proposals in play. We know they've made the decision that they're going to build a national maritime or border surveillance system of some type and embark on that path, and they have budget or they have a financing route Now it's serious. Now it's a case of specification and financing. That might take two years, it might take a year, it might take six months.

And so then we'll focus the time on that. But our existing customers always, always, always, always, always take precedent, and we have delivery team that is there. And I think if you came and talked to SRT, we take this sovereign partnership concept super seriously, everybody in the company, and they will go and work with that customer, whatever the condition is. So once you've got a project on your VSP, what's the probability of that project dropping off the VSP, or does it stay there until it gets executed?

A VSP may or may not be signed. Yeah. Thus far, we've never lost anything out of the VSP, and it's grown. So if you imagine, it started at zero in two thousand and fourteen, and it's grown, and as it's grown, some have converted into contract, some have been- But nothing's dropped off it.

No. And some of the projects have got even, even larger. Presumably they get gated by politics and financing and things that are possibly outside your control. Yeah.

Back to this forecasting thing. So there's two types. There's existing customers and new customers. About half of it is follow-on from existing customers as they all build up their system, like sort of like Lego.

And so they're much easier to predict 'cause you're having that conversation with the decision-maker, and they'll say, "Well, we have the budget in two thousand and twenty-seven. You can expect a contract midyear." So now we have a lot of visibility on that, or it's gonna be two thousand and twenty-eight. On the new ones, that's much more difficult 'cause no one really knows because there's so many different approvals that have to be had.

The reality is nobody really knows. So they can give you a guide, and what we look for is when's the budget approved? 'Cause nothing happens in a government without the money. And so then we put a time on that.

But typically, we expect what's in the VSP to actually convert in a, anywhere between a one and three-year period. So what does SRT look like in five years' time? So we're transforming really from a maritime domain awareness systems business into a sovereign border and territory surveillance business, where we deliver this single integrated system that looks out on sea, land, and air and integrates that together into an intelligent system. And we will be a partner with a variety of sovereigns where we're building that out.

We're supplying them with unmanned surface vessels, unmanned aviation vessels, unmanned land vehicles, subsea data services, training to maintain their national civil security. And that's what we will be doing. And as we go along, there'll be new technologies coming. We'll be integrating that.

You know, we're in the AI age. Whether there's a bubble or not, who knows, but AI is here to stay, and we are using that to give insight into events. A good example is Bahrain. They've been a customer of ours now for 12 years And we recently signed for another 10 years.

Have more gray hair in five years, but we'll be significantly larger than we are today. You've mentioned several countries in that area that you're working with in this space. What's your take on how the events in the Gulf and the Straits of Hormuz resolve itself? How do you see it panning out from the perspective you've got in that region?

So as my personal opinion- Yeah I think that what we're seeing isn't new. It's happened in the past, it'll happen again in the future. Super unfortunate the way it's happened. I think what will happen now is you're already seeing vessels transiting.

Yeah. Maybe not publicly. Two weeks ago it was, "Gosh, an oil tanker went through." Yes.

Now it's, "Oh, they're going through, but how many?" Yeah. I think in a few more weeks' time it'll be, "Oh yeah, it's flowing." And every so often there might be a stoppage or something.

So I think that everybody will sort of retract back into their cave and claim victory, and then go back to the day job, if you will, and recover for the next decade or so, and then it might flare up again. You know, there are fundamental tensions between countries and areas, and there's no change at the gap at Hormuz. I think because the countries are more developed now and they see the weakness and they see the effect, you know, things like trans-land pipelines- Yes will be expanded and things, so there's less reliance on that.

They're gonna be built very quickly. Yeah. And they're gonna need civil defense- Yes and security and all the rest of it- Yeah that goes with it. During the real bombing recently, I went to Kuwait to stand with our customer, and I had to fly into Riyadh and drive across the desert through the night and everything else, and you realize it's a long way and there's places you can't get out of the car 'cause the Bedouin don't like people that look like me and stuff like this.

So there's a big national security thing to protect the land pipelines as well. So I think it will calm down as it is now. Be a few little spats here and there. You know, it's pretty unfortunate that on Tuesday, Kuwait Airport, Wednesday, got hit again with a drone.

That's awful. One person killed, 63 injured with serious injuries. But hopefully those sorts of incidences will calm down. I think in the region there's a lot of very intelligent, clever people that wanna get on with their lives and grow their economy.

So I'm generally an optimist. I think it'll calm down and it'll be all right on the night. Can I add one thing? When you talked about the sort of secret sauce, as it were, we've touched on it a bit, but Sovereign Partnerships were all about building out the capability across various domains and with various technologies and hardware.

But I know we've touched on so much is the degree to which it's almost impossible to switch out of the SRT GeoVis system started, which is one of the reasons why I guess Simon's so confident that if you're an existing customer within that pipeline, it's pretty likely that the 50% of the pipeline that's existing customers will convert. Sovereign Partnership means that, that that gives us these long-term customers and sources of contracts and revenues, you know, recurring contracts over many, many years and decades.

And the reason for that is once they've selected our base system, it's a whole way of operating. The data is embedded in our system. They've bought an operating system, and that makes it extremely, extremely sticky. I think that that is also then driven by the need and increasing need for Civil security, economic growth, social integrity is all built around security.

If you don't have security, you don't have anything, and that's super important, and that's what we're delivering today in the marine world and going forward, land borders, air borders. Yeah, so this actually is just the beginning. We've sort of just done the proof of concept, really. So if Kuwait is your maritime reference customer, are we about to see a new customer or an existing customer become your sovereign partner where you're involved in all aspects of civil defense, not just maritime?

Maybe. Very expansive answer. I think I started the, the description of our business and how we've been customer-led, so I don't think- Yes we'd be talking so strongly about land borders and drone detection and all this sort of stuff unless this was being driven by our customers. Yes.

I get it. And we have some pretty ambitious, intelligent customers- Yeah who know what they're about, know what they want, and know that we can deliver. And so we're, in the context of sovereign partnership, we're gonna stand with them, we're gonna deliver it to them. And the harsh reality is they and all of us are operating in a world of greater uncertainty in a geopolitical sense, and it's every man for himself right now.

It's every country for themself. You were saying, why is it in developed regions and stuff? When I go to places like Kuwait and Saudi and Indonesia and stuff, you know, the passport systems work in seconds. It's super modern.

They have super high expectations, and this is only gonna increase. That's great. Thank you very much. Really enjoyed the conversation.

I would recommend people take a look at your website, listen to your last webinar, and again, well done on getting to where you are, and look forward to following your progress with great interest, Simon. Thank you. Thank you. British brains, British capital.

Before you go, these are my main takeaways from this conversation. The shift from product to system. SRT has evolved from selling AIS transponders to delivering integrated national surveillance systems. This pivot from box seller to systems integrator is pretty core to the equity story.

The backlog and pipeline give revenue visibility with over half a billion pounds worth of contracts signed to date and one point eight billion of validated forward sales. This, Simon believes, is a game changer not yet reflected in the equity valuation, and the moat is not just technology, but it's trust-based on word of mouth. Once a sovereign embeds SRT's operating system, switching out is near impossible, and fifty percent of its pipeline is from follow-on expansion from existing customers.

This provides a very strong competitive position that Simon claims no one else can match in terms of integrating land, sea, air, and civil defense intelligence at national scale. He frames the closest parallel as Anduril, which does this in the defense space, but SRT operates in civil defense, not weapons. He also explicitly distinguishes SRT from Windward, founder Ami Daniel, who's a friend of the pod, which sells intelligence. SRT sells the tool and teaches the customer how to run it.

And emerging powers as customers is an important distinction here. SRT has six sovereign partnerships out of a total of a hundred and fifty coastal nations in the world, and this offers SRT a long runway. These regions have the need, very often the money, and the appetite for independence from the West, and they are fast technology adopters. They face a form of jeopardy that Europe and NATO are only now waking up to.

This fact opens up newer Western markets as an opportunity for SRT going forward, and there's also the expansion beyond maritime. Kuwait and others are pulling SRT into new segments such as land borders, drone detection, and subsea protection. The strategic positioning is shifting from maritime domain awareness to sovereign border and territorial surveillance. SRT's geopolitical exposure is real, but while its contracts sit with governments whose alliances can shift fast, Simon argues that independence mitigates this.

On-prem deployment and with modular build-out, civil defense covers the ninety-eight percent of the time that countries are at peace with each other, which he argues is a larger and more durable market than military and defense. However, being a public company has often been painful, but he says it's useful. Simon is frank that the listed market can punish misforecast, and that forecasting government timelines two years out is difficult. But AIM gave access to capital and credibility and notable backers, and he prizes transparency.

His unscripted webinars and open AGM and investor days are testament to this, and he sees no urgency to leave the AIM market, which allows for investors to enter and exit when and if they need to. He sees a path to a billion-pound valuation from its existing two hundred and fifty million market cap. Further capital may be needed, but not necessarily equity. Above all these issues sits governance and succession planning, and Simon sees a strong independent-minded board, some with meaningful equity stakes, strict separation of finance and operations, and a discipline that has killed bad ideas such as a proprietary satellite constellation.

And he now has a team of a hundred and eighty people heading to three hundred in the foreseeable future. Simon has just seven direct reports and is now focusing more on strategy than the day-to-day. But there are risks. Forecast lumpiness and timing slippage, projects gated by government budgets and internal politics are day-to-day issues.

Concentration in geopolitically volatile regions, and the what I don't know risk that Simon flags himself. To date, nothing has dropped off the validated sales pipeline, and projects typically convert within one to three years. But there is no guarantee that this will be the case going forward. Overall, this was a fascinating discussion, and SRT has some very positive characteristics that one might expect to find in a successful growth business.

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