One reason somewhere between $400 million and $1.36 billion worth of construction equipment is stolen worldwide every year, depending on the estimate, is simply its value, but another reason is that all vehicles of the same model usually share the same key. St. John’s-based Veristart has a possible solution.

Veristart is working on a digital access control system for construction vehicles, using a physical module placed in the cab, along with a smartphone app. Together, they create unique digital keys for each equipment operator.

The company, which earlier this month won $10,000 by placing first in Newfoundland and Labrador startup hub Genesis’ Pitch & Pick Invitational competition, was founded by entrepreneurs Craig Hannam, Lou Lawrence and Ajay Pande. Hannam was previously a CFO for hire at professional services firm BDO and before that worked in the equipment rental industry, as did Lawrence, while Pande spent three years as global head of business development for Nokia.

“Around Newfoundland and Labrador the last few years, there have been a lot of incidents where construction equipment was stolen and used in another crime — most often used to steal an ATM machine, for example.

“In the news, they even had a term for them. They used to call them the Backhoe Bandits.”

As long ago as 2018 and as recently as last year, stolen heavy equipment has indeed been used in a string of ATM heists in Newfoundland, seemingly carried out by multiple, unrelated groups of people. In July, for example, RCMP charged four men for stealing more than $25,000 from an ATM in Witless Bay.

“I worked in finance for United Rentals for many years and I remember, way back when I first started, we would order these rings of master keys for our mechanics and our drivers,” said Hannam. “I was shocked that one key operates all these machines.

“And not only that, but now you can go on Amazon and buy that set of keys — that was pretty hard to get back in the early 2000s — you can go online and buy them for less than $50.”

Stemming the problem of equipment theft is important for both the companies that own the vehicles and the operators of the construction sites, since if someone inappropriately gains access to the equipment, it can be not only costly, but a source of serious legal liability for all involved.

Competing products exist that rely on passcodes entered via a numeric keypad, but that raises the spectre of passcode sharing and other poor information security practices, whereas Veristart allows for each person operating a given piece of equipment to be assigned their own, unique key by fleet managers via a cloud application.

Hannam, Lawrence and Pande have completed a working prototype and are now pursuing their minimum viable product so they can start field testing. That process will also involve them hiring the company’s first employees outside the founding team.

Initially, Veristart will focus its business development efforts on Atlantic Canada, and the trio is in advanced talks with several potential customers in the region. But in “relatively short order,” Hannam hopes to market Veristart across North America.

Also adding to the business’s potential international markets is a law passed in the United Kingdom last summer that empowers regulators to mandate that equipment owners install theft prevention devices. Veristart estimates that such a rule, were it to be implemented, would translate into well over one million vehicles needing to be retrofitted.

“If other jurisdictions around the world pick up that idea and run with it, it’s already a huge market, but that could be a huge catalyst,” said Hannam.