After the school shooting in Parkland, this past February, Bloomberg reported that the Florida Teachers’ Pension Fund was invested in the maker of the same gun used in the massacre at Marjorie Stoneman Douglas High School.[1] The shooting in Parkland and the countless gun-related tragedies in the last few years have divided the nation in a profound debate surrounding gun control and mental health. The one indisputable point is that the number of lives affected by gun violence is unacceptable.  As parents, we fear that our children’s generation will grow up numb to the seemingly endless stories of gun violence in the news. Here are a couple of facts to consider:

  • Each year on average approximately 125,000 people (all ages) are shot and of those, approximately 17,000 are children (ages 0-19).[2]
  • Less than 5% of the world’s population lives in America but America accounts for 48% of the world’s civilian-owned firearms.[3]
  • Researchers conservatively estimate that gun violence costs the American economy at least $229 billion every year,[4] an amount roughly equal to domestic corporate tax revenues.[5]

Riverwater Partners was founded on the principle of aligning investments with values. In large part, this means connecting investors with businesses that try to enhance our world for the next generation. As Environmental, Social and Governance (ESG) based factors contribute a key component in our research, we recognized gun violence as a prevalent social issue and this year invested in a company that is working to reduce the effects of gun violence across America.

Our position in ShotSpotter (NYSE: SSTI) illustrates how investing can drive social impact. ShotSpotter is a gunshot detection technology company that notifies law enforcement within 45 seconds of a gunshot to a 100-foot radius of the shooter’s location based on triangulated acoustics. The company has over 12,000 sensors deployed across 90 municipalities covering 550 square miles that help “law enforcement and security personnel rapidly identify, locate and respond to gun violence.”[6] In 2017 ShotSpotter generated 99,000 gunshot alerts.[7]  These alerts dramatically improve response times, educate first responders about volatile situations and enhance evidence collection. While this is not the absolute solution to preventing mass violence, we believe it is an application that has merits and we are not alone as ShotSpotter is currently deployed in 10 of the top 25 cities in the US.  There is a strong potential for growth as the company estimates that they are only about 5% penetrated in their core market opportunity.6  The strong performance of ShotSpotter from Oct ’17 to mid-Oct ’18 is below.

 

Shot Spotter Chart

 

ShotSpotter is one example of how Riverwater Partners aligns investments with values.  We continually seek to invest in companies that provide potential financial reward and aim to make the world a better place for ourselves, our children and grandchildren. We encourage you to review your investments to ensure they are aligned with your values.

 


*Value(s) Investing: value investing aligned with your values.

 

[1] Weinberg, Neil, and Polly Mosendz. “Florida Teachers’ Pension Fund Invested in Maker of School Massacre Gun.” Bloomberg.com, Bloomberg, 20 Feb. 2018, www.bloomberg.com/news/articles/2018-02-20/florida-teachers-pension-fund-invested-in-maker-of-school-massacre-gun.

[2] “Brady Campaign to Prevent Gun Violence.” Key Gun Violence Statistics* | Brady Campaign , www.bradycampaign.org/key-gun-violence-statistics.

[3] “Small Arms Survey 2007.” Small Arms Survey, 4 Mar. 2015, www.smallarmssurvey.org/de/publications/by-type/yearbook/small-arms-survey-2007.html.

[4] “Gun Violence Statistics Archives.” Giffords Law Center to Prevent Gun Violence, http://lawcenter.giffords.org/category/gun-studies-statistics/gun-violence-statistics/,

[5] Amadeo, Kimberly. “Compare Congress’ Enacted Budget to Trump’s Requests.” The Balance, www.thebalance.com/fy-2018-trump-federal-budget-request-4158794

[6] ShotSpotter July 2018 Investor Presentation. https://content.equisolve.net/_f9f34d30735e835833a99edecfaccc1c/shotspotter/db/297/2072/pdf/SSTI+Investor+Presentation+-+July+2018.pdf

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