Venture capitalists last month sunk nearly half a billion dollars into a Southern California defense technology startup whose surveillance towers track migrants along the U.S.-Mexico border.
Anduril Industries, the Irvine-based maker of autonomous drones, towers and small ground sensors, will use the $450 million for acquisitions and build out its AI-powered tech designed for military and border enforcement agencies.
But activists and experts are raising flags about the technology, pointing to privacy violations and civil liberties infringements.
They also question the government's steep investment in the private defense contractors behind it.
"The fact that we're spending money on the border wall also means that we're not investing in the things we all actually need here in the valley," said Norma Herrera, an organizer with the Rio Grande Valley Equal Voice Network.
She pushes back against what President Biden called an "effective and modern border security" system—a bureaucratic apparatus that allocates $1.2 billion for border infrastructure next year (still a drop in the bucket, given the Department of Homeland Security's $52 billion 2022 budget).
Before the pandemic, Herrera knocked on doors in Texas' Starr County to tell residents about the amount of money elected officials were pouring into Trump's border wall. Now, she's learning how to explain the virtual wall, one that's often harder to notice.
Anduril declined to make executives at the company available for interviews.
Surveillance on the Border
Over the last decade, the border security and immigration detention industry has ballooned as Democrats and Republicans both funnel more government money into private companies. Between the fiscal years 2017 and 2020, Customs and Border Protection received about $743 million from Congress for tech and surveillance, according to the legal organization Just Futures Law. And in the 2021 fiscal year alone, the Department of Homeland Security received over $780 million for the same purpose.
Anduril's recent project with CBP revolves around a $250 million contract signed under the Trump administration in July of 2020 to set up 200 solar-powered watch towers along the southern border. Of the towers, 60 are up and running as of July 2.
Under Biden's leadership, funding for border technology has become an even bigger priority, said Dinesh McCoy, a legal fellow at Just Futures Law.
"It's in large part a response to coinciding pressures of distinguishing themselves from the Trump years," he said.
Many Democrats back Biden's vision, considering a virtual barrier a far better alternative to the physical border wall Republicans prefer.
"When it comes to proposals for a virtual wall, we're talking about heavy, heavy investments," said Saira Hussain, an attorney at the Electronic Frontier Foundation who specializes in racial and immigrant justice, surveillance and technology.
Government agencies are tapping a number of private companies to install the technology. In 2019, CBP awarded the Israeli defense contractor Elbit Systems $26 million to install surveillance towers along the border.
Then came the administration's 2020 deal with Anduril. Its AI-powered operating system, called Lattice, is designed to distinguish humans from animals along the border and send information to an agent's cell phone. The company has to date received $691 million in venture capital, including $450 million that had backers including Andreessen Horowitz last month. Anduril is now valued at $4.6 billion.
"As with all of our investments, this is a bet not just on the technology (breathtaking) and the market (enormous) but also the people (outstanding)," Andreessen Horowitz co-founder and general partner Marc Andreessen said in a prepared statement.
Marc Andreessen is a longtime investor in Palmer Luckey, Anduril's 28-year-old founder. He backed Luckey's first company — virtual reality startup Oculus — before Facebook bought it for $2 billion in 2014. A few years later, Luckey left following reports that he was funding a far-right political group.
In 2017, Luckey opened Anduril with a band of former employees from Oculus VR and Palantir, the software giant with major contracts with several government agencies.
Anduril Border Tower
Along the border, Anduril's 33-foot towers are continuously scanning plots of land about three miles in diameter. They're built to ignore animals — what CBP calls a "false positive" — and light up after detecting movement from people or cars.
The towers are watching "illegal border crossings, human trafficking and drug smuggling," a spokesperson for Anduril said by email.
If a person or group falls out of the camera's vision, AI tells the next tower to pick it back up. Border patrol agents then receive an alert to their cell phones or computers.
The goal is to mimic an agent's pair of eyes, especially in remote and rural spots. As one agent put it, "they see what we can't see on the ground."
They also run on solar power, a feature CBP said avoids the need for new infrastructure that can "complicate the Border Patrol's agreements with many of the private ranchland owners, national parks, and Native Americans' tribal lands where the Border Patrol must work."
Video surveillance drones and towers are puncturing nearly every industry, from homeland security to fast food delivery to monitoring traffic and parking violations along busy streets.
The tech is also raising a flood of questions from academics and legal groups like the Electronic Frontier Foundation and Just Futures Law, all of them worried about the implications of surveillance not only for migrants, but for U.S. residents. In May of 2020, for example, agencies CBP flew a drone over Minneapolis to record protestors following the police murder of George Floyd.
"We know that what's often deployed at the border and what's normalized at the border in terms of surveillance eventually makes its way into the interior of the United States," said Hussain, the attorney from EFF.
The company says it does not use facial recognition or collect identifiable information.
But critics like the ACLU of Texas and other civil liberties groups said it's unclear what data is being collected by private defense contracts like Anduril and how it could be used and shared.
"The border is a testing ground for surveillance elsewhere," said McCoy, the legal fellow at Just Futures Law. "Unfortunately, it's been primarily used to surveill Black and brown folks in the U.S. and abroad."
As the U.S. begins reducing its military footprint in the Middle East, McCoy suspects other military contractors will turn to border surveillance as a new form of profit.
"These tools that were once confined to military contexts have found themselves more and more in local communities," he said.
Anduril, for its part, insists it is providing the government with a crucial security mechanism. "Anduril identifies a security problem," reads a prepared statement forwarded to dot.LA by a company spokesperson, "builds a potential solution, then takes it to the government for potential consideration."
Lead art by Ian Hurley
Editor's note: This article has been updated to clarify that Andreessen Horowitz was involved in Anduril 's$450 million raise round, but was not the sole funder. Additionally, mentions of Anduril's $250 million contract with CBP have been updated to clarify that they were not negotiated with President Trump himself, but rather with members of his administration.
- Snapchat Accused of Being an 'Ecommerce' Site for Fentanyl - dot.LA ›
- A TikTok Timeline: The Rise and Pause of a Social Video Giant - dot ... ›
- Fisker and Apple Manufacturer Foxconn to Build Electric Cars - dot.LA ›
- Oracle Confirms Deal with TikTok - dot.LA ›
- Ferret Raises $4 Million to Bring Checkered Pasts to Light - dot.LA ›
Nearly a year after Culver City-based cloud-based security company Openpath raised $36 million, the company announced it was acquired by Chicago-based Motorola Solutions. Terms of the deal were not disclosed.
Created by serial entrepreneurs Alex Kazerani and James Segil, Openpath started in 2016 as an alternative to building security keycards.
The 87-person company expects to retain their headquarters while Kazerani and Segil will report to John Kedzierski, manager of the video security and analytics department at Motorola Solutions.
Openpath leverages a three-tier cloud-based encryption method to make the process of entering buildings virtually frictionless by connecting the door sensor to the mobile phone in three different ways. When an employee waves their hand at the sensor, it will connect to the phone and unlock the door.
The same technology can be implemented at elevators, parking lots and other large-scale enterprises.
The acquisition will help Motorola Solutions, a largely enterprise-focused communications company behind a slew of communication products for police officers, firefighters and retail stores, expand further into the physical space. The publicly traded company has been gobbling up security firms in recent years, including video surveillance venture Avigilon in 2018. Last year it picked up the Fresno-based video security upstart Pelco for $110 million.
"All of that has been to build an end-to-end portfolio in the physical security space," Kedzierski said. "So from video to access to analytics that tie all of that together."
The physical security space is a fast-growing industry, partly due to companies adopting the popular software-as-a-service business model.
Segil said Openpath hopes to leverage Motorola's large sales team, supply-chain capabilities and "credibility with large enterprise customers who we are increasingly selling our products and services to."
The article has been updated to accurately reflect the number of employees at Openpath.
- How an LA Hackerspace Became a Lifeline for Hospitals, Tribal ... ›
- Meet LA Tech Entrepreneurs James Segil and Alex Kazerani: - dot.LA ›
- Openpath Announces $36 Million Raise - dot.LA ›
An L.A. security startup that has already signed on clients in tech, gaming, cannabis and entertainment is coming out of stealth mode just as the deadly assault on the U.S. Capitol and this week's presidential inauguration has brought safety to the forefront.
HiveWatch provides companies with a central platform that uses multiple sensors across buildings to help better respond to physical security threats.
Created by Ryan Schonfeld, who has spent his career building security programs for startups and Fortune 500 enterprises, and has been a consultant to the U.S. State Department since 2012, HiveWatch raised an undisclosed sum from CrossCut Ventures, with participation from Freestyle and SaaS Ventures.
The coming out has been long-planned and is not tied to current events, CEO and founder Schonfeld said.
"I don't want to say the timing is fortunate because crazy things happening in the world are never what we hope for," said Schonfeld. "But there's absolutely a tailwind that we're experiencing."
The rest of the leadership team has experience at Apple, Cisco, Bird, Disney and NORAD.
"We were attracted to the background of this founding team, and their history and experience in scaling corporate security systems for high-growth companies like Bird," Brian Garrett, co-founder and director at Crosscut said in a written statement. "Their approach will make corporate security programs more accessible for both high-growth startups and Fortune 500 enterprises as we enter a post-Covid, data-driven paradigm."
HiveWatch's platform pulls data from different sensors to offer a one-stop view of threats. The goal is to cut down on noise so help security operations centers can focus on genuine intrusions. For instance, Schonfeld says door sensors designed to monitor who's coming in and out mostly trigger false alarms, so it's hard to tell whether someone broke down the door or if the sensor is just malfunctioning. As a result, warnings go ignored.
"The main sensor that drives that entire intelligence loop in the system is about an $8 magnet that sits at the top of the door and they break and they're faulty all the time," Schonfeld said.
Ryan Schonfeld has spent his career building security programs for startups.
HiveWatch aims to complete the picture by providing guards more information. So if a door sensor is triggered, the system also gives a surveillance video of the door so guards can determine right away if something is amiss.
"The system can say, 'OK, we see that there's a door forced event, but the camera says that nobody went through that door'," Schonfeld said. "And so that's a different story for a security response than if there's a door forced event and a person actually comes through the door."
Schonfeld says he is excited about the chance to modernize the security industry, which has been very slow to evolve.
"I started my career in law enforcement, which was a passion of mine since I was a little kid," said Schonfeld. "It was one of the most rewarding things I've ever done in my life, but the constant frustration in law enforcement was just the decades-old, antiquated approaches that never seemed to evolve."
Schonfeld says there is already a waiting list for the company's product from tech, gaming and entertainment companies and he's seen especially high interest from the growing number of cannabis companies.
"Cannabis has far and away had the most number of sensors per square foot of almost any industry we've ever encountered," said Schonfeld. "They're going to be a really interesting one to leverage the platform with."