Enspire Electronics started in hot tubs, but might end up in your iPhone
Jet Setter: James Keirstead
by Tim Querengesser
#45 on the Fast Growth 50
Enspire Electonics (formerly Global Spa Components)
Head Office: Edmonton
Industry: Engineering and manufacturing
2012 gross annual sales: $2,813,051
2011 gross annual sales: $1,179,944
Two years ago James Keirstead bought Enspire Electronics, a high-tech manufacturing firm in Edmonton that was bleeding money. At first he grabbed Enspire simply to make better hot tubs. Controlling the pumps, jets, filters, lights and stereos that a contemporary spa features requires sophisticated electronics, and making these controls in-house allows a manufacturer to distinguish itself from its competitors. Enspire did just that for ‘Arctic Spas,’ the internationally distributed brand that Blue Falls Manufacturing – which Keirstead co-owns – builds. But he soon realized that the new work Enspire attracted by making hot-tub controls created an opportunity to expand into making mainstream electronics. So far, at least, it’s looking like a good plan.
In 2013, Enspire – which engineers and builds circuit boards, and custom manufactures nearly anything electronic – will pull in $3.2 million in sales, up from $400,000 when he bought it, Keirstead says. In 2014, he estimates sales will hit $4.9 million. The trick hasn’t been to re-invent Enspire, or even the hot tub (“really, in spas, there’s nothing new happening,” Keirstead concedes), but rather to use the steady production volume building controls for Arctic Spas has created to fund research and development on new products for bigger markets. Keirstead says while 75 per cent of Enspire’s business is building spa controls, future growth will “almost exclusively” come from new products and new markets. “I buy enough controls that I can cover the nut here,” Keirstead says. “That allows me to hire an engineering team that can develop new products and new ideas.”
Keirstead calls himself a “serial entrepreneur,” and got his start selling hot tubs before owning a retail tub store with his twin brother and partners (it failed), and exporting home-leisure products to China. Since then, he joined Blue Falls as a partner, formed a joint-venture in China that manufactured hot-tub components, and even got into retailing billiard tables and games-room furniture. “It’s an organic evolution,” Keirstead says. “We owned stores and were always looking for more products to sell. So we developed more products.” That requires research. This year, more than $1 million will be poured back into product development at Enspire, Keirstead says. “When I bought this company I knew we weren’t going to be able to be a long-term, viable business totally tied to the spa industry. We needed to diversify.”
Always using the hot tub as a sort of wet test bed (“Hot tubs are a lot more complicated than most people realize,” Keirstead says), Enspire has begun developing consumer products for home automation. The biggest? Likely a wireless light switch, created in partnership with Landmark Homes, which could be in their houses as early as 2014. Another is a wireless audio amplifier to stream music throughout your home. Others include low-energy LED light conversions for fluorescent lighting in offices and even custom oil- and gas-extraction controls. All link back to expertise he gained on hot tubs.
The ability to remotely control appliances such as a fridge or, yes, even a hot tub, through smartphone apps is what’s coming next, Keirstead says. “People want to control most of their household from mobile applications. Home automation is one of the biggest growing industries today – they predict by 2017 it will be a $17 billion industry. And it’s not a technology that a lot of companies have expertise on. Very few applications on your phone can actually have it connect to a device in your home or around your home and cause that device to turn on, or off, or do something.” And how did Enspire gain a foothold in such a niche, high-tech growth market? The first smartphone app it engineered controls an Arctic Spa hot tub.