Wytec International Inc., a builder of 5G wireless networks, is working on artificial intelligence software to deploy on networks of sensors to pinpoint the location of gunshots or other campus problems and immediately notify school officials.
Founder and CEO William "Bill" Gray launched the company in 2011 to provide in-building cellular networks to schools. But that goal changed after the May 2022 Robb Elementary School shooting in Uvalde that left 19 fourth-graders and two teachers dead after an 18-year-old gunman opened fire with AR-15-style semiautomatic rifle.
"Now there's a big focus on gunshot detection on campuses," he said. "So we now are more and more focused towards that."
Since then, the firm has added five provisional patents for its AI software and methods. It expects to roll out a pilot program to test the system at some Texas schools sometime in the next year. Judson, North East and Southside ISDs in San Antonio are among the 46 Texas school districts that have expressed interest in participating, according to Wytec.
The company also has submitted a proposal with the North Central Texas Council of Governments, which is seeking vendors to provide "advanced gunshot detection solutions" for 1,207 school districts. Gray said that deal could be worth as much as $2.4 billion.
"The smallest contracts in this thing are going to be $50 million to $100 million and up," he said.
He'll find out in late December whether Wytec made the cut.
As he waits, he's also working to strengthen the company's financial footing and move the company's stock, which trades under the ticker symbol WYTC, from the OTCQB, an over-the-counter venture market, to the Nasdaq Stock Market.
SENATORS AND AI
Robert Sanchez, Wytec's chief technology officer, came to the company after years in the defense industry, where he designed software for Tomahawk cruise missiles, worked on early unmanned aerial vehicles and developed technologies to counter improvised explosive devices during the nation's wars in Iraq and Afghanistan.
Wytec's gunshot detection system is "an adaptation of the technology I helped to develop to defeat IEDs throughout" Southwest Asia, Sanchez said. He sees the technology as a critical component of making schools safer.
Rather than manufacturing its own sensors and hardware, the company plans to integrate its AI software with other vendors' equipment. Wytec's software is compatible with various types of cameras and sensors that monitor motion, temperature, light, sound and pressure.
Sanchez said the system communicates via a private, secured wireless network.
Its centerpiece is Wytec's LPN-16, a patented, small cellular base station that quickly processes the data coming from the sensors and cameras and provides information about unfolding events to school and security staff via a mobile app.
A company presentation showed the mobile app interface, which displays the event's location and provides real-time video and communication.
"They can view very quickly the video going on. They can listen to the audio. They can come up with so much information that they can corroborate" what's happening, Sanchez said.
In addition to gunshots, the sensors can detect smoke, fire, drugs and even chemical and biological agents (it can ferret out the chemicals in the air). He said they are working to make the sensors capable of detecting THC, the active ingredient in cannabis.
"Our technology allows us to detect liquid and solid particulates using some very specialized technology that we're developing jointly with ( University of California) San Diego," Sanchez said.
One difference between Wytec's system and others on the market is that it does not immediately call 911. Others, he said, immediately dial 911.
"If you're very familiar with some of our competitive technologies, they get too many false positives," Sanchez said.
SCRAPPED TEST
In 2016, San Antonio installed a gunshot detection technology called ShotSpotter in parts of the city's East and West sides where gun violence was particularly high. The city scrapped the system a year later, saying it was too expensive and didn't reduce gunfire in the areas where it was installed.
While it was in use, ShotSpotter alerted the San Antonio Police Department to potential gunshots 431 times in which there was no other notification, such as from a neighbor or other witness. In about 80 percent of those incidents, police could find no evidence of a shooting at scenes the system sent them to.
By putting teachers or administrators in the loop, Wytec says its system can help limit unwarranted lockdowns or first responder callouts.
The company says it's performed 500,000 lab tests of its software, logging "better than 90 percent accuracy" in identifying gunshots.
The system also will be able to pick up preprogrammed key words that could be used to trigger an alert.
That means that "teachers aren't the only one with the ability to trigger things. Students can too," Sanchez said. "If a student sees an incident, they call out, for example, 'Code Red,' you'll be able to detect that on our system."
PATENTS QUEST
Wytec already has two patents for some of its communications technology. They cover the company's designs for local area networks with high data transfer speeds across multiple channels.
In September, it filed applications for five more patents covering various aspects of its detection system.
They include requests for international patent protection for a "Smart Sensor System for Threat Detection," which is described as "a process for firearm discharge detection using multiple machine learning models."
The company also filed an application with the U.S. Patent and Trademark Office for the same technology.
The other three applications are also for international patent protection.
The first of those, "Smart Sensor System for Threat Detection and Method Thereof," covers "a system and method for detecting and communicating threats using various communication protocols."
The second one, "Threat Detection System Employing Multiple Models," addresses artificial intelligence using "dataset models for firearm discharge in both sterile and noisy environments."
The third application, "Smart Sensor System and Method for Threat Detection and Response Based on Detection of a Vocal Phrase," describes "a smart sensor system and method for threat detection based on vocal phrase recognition."
WYTEC FINANCES
As a publicly traded company, Wytec has filed quarterly earnings reports with the Securities and Exchange Commission since 2017.
It posted a net loss of $581,455 on $25,514 of revenue for the second quarter, the most recent report filed. That's higher than the loss of $396,954 it reported for the same period in 2023.
Those numbers "make us look like a tiny company that's never going to make it," Gray said. "But we're way past that."
He said the company is well-positioned to break into the black, especially if it lands part of the North Central Texas Council of Governments deal.
Wytec was set to have an initial public offering on Nasdaq in February 2022, but Gray said the Russian invasion of Ukraine that month tanked those plans, as it did for many companies seeking to go to market at the time. IPOs declined around the world after the invasion, according to Global Finance magazine. American companies alone canceled or delayed more than $1.17 billion in planned public offerings in February 2022.
In July, Wytec withdrew a second Nasdaq IPO attempt, which would have offered 3.75 million shares at $4.25 to raise more than $15.9 million. Gray said he pulled the offering over concerns about Nasdaq's policies on reverse stock splits.
Instead, the company pivoted and went public on the OTCQB, the middle tier of OTC Markets Group's over-the-counter market. It is geared "for entrepreneurial and development stage companies," according to the group.
The OTCQB is a step up from the "Pink market" or "pink sheets" that are notoriously high risk and have a reputation for attracting "pump and dump" schemes where companies artificially inflate the price of a stock.
OTCQB is not as speculative as the Pink market, and companies "must meet certain minimum reporting standards, pass a bid test, and undergo annual verification," according to Investopedia.
"We've never been a pink sheet," Gray said.
Wytec's shares have hovered around $2.50 and closed Friday at $2.15.
Gray said Wytec is using the OTCQB listing as a bridge to Nasdaq.
The company needs to trade at $4 or more for 30 days before it can move to Nasdaq, according to Gray. Getting listed on the larger market would unlock $100 million in financing to help the company grow, he said. The funding would come from Global Emerging Markets, a private investment group Wytec is working with.
"It's a $100 million shelf offering contract that three days upon listing on Nasdaq, we can access," he said. The funds will help "build this thing out across the United States."
"To qualify for a contract like this with ... a funding group is a major milestone," Gray added.
He said he expects the company to move to Nasdaq by the end of the year.
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