A story of perseverance
Here we are. 10 weeks into COVID-19 and all its good, bad, and ugly. This post is not about us, this post is about a friend and his company "Scenic Corporation of New York", who got very creative during these very challenging times. So, here's my interview with Randy Alexander, Founder & CEO of SceniCorp, based in Brooklyn, NYC.
Torsten: Randy, thank you so much for taking the time today to talk with me. Can you tell me a little bit about yourself and your company, Scenicorp?
Randy: I grew up in Los Angeles and when I was 30, I was a construction manager in LA. I was basically a carpenter building houses there.
Eventually, I came to New York and started renovating apartments. Then, I got into theatre work and landed in the NBC scenic shop where we were building sets for Saturday Night Live and The Today Show. I stayed there for 10 years and then I started my own company 20 years ago.
Scenicorp is a scene shop and most of our work comes from corporate clients: product launches, corporate events, episodic television. We also do quite a bit of work for The Today Show, providing scenery and backdrops.
Torsten: How many people work for Scenicorp?
Randy: Between 35 and 40 full-time employees. Depending on the project work, this number can go up quite significantly because our industry is very freelancer-based.
Torsten: When did the COVID-19 crisis start to impact you and how?
Randy: We had a great beginning to the year. In February, we heard the first news about the novel coronavirus and boom, our events started to cancel one by one - and pretty soon everything was canceled.
Unfortunately, I had to lay it off all of my workers except for a very small core, administrative staff including HR, Controlling, and my production manager.
I made interest-free loans available to all our employees. I have agreed to pay for health insurance for all employees for April and May. Our cash reserves are limited, so that is when we started to get creative.
Torsten: How so? What did you come up with?
Randy: I came up with a design for a sneeze guard, which is a plastic panel that separates you from another person in stores, gas stations, receptions etc. They're used everywhere now, and we've sold several hundred.
We're working with NYCHA, which is the New York housing authority to provide them for all of their buildings, which is in the hundreds. So, that was our first product and right now we have a small staff working on those.
But we didn’t stop there. Sometime in March, I heard President Trump saying that ventilators cost between $25,000 to $50,000 a piece and that he would be imposing on Ford and GM to build them.
And I thought: I can definitely build a ventilator for far less than $25,000. We are a scenic shop and we are used to having impossible deadlines. We got to work and we used an open- source design we found online. It was designed by students at Rice University in Texas. I picked up the phone and we started to talk with them.
We corrected several things that we found were incompatible and came up with our first prototype. We’re now on our fifth iteration, which we consider to be our production model. And, I've now given the go-ahead to set up the actual assembly line.
I’ve been able to hire my foreman back and have given him the green light to setup the assembly line. Production is starting as we speak!
Torsten: Since you’re used to building things, one could argue, “building is building”. But don’t you need any medical experience to start building equipment that eventually gets hooked up to the lung of a patient?
Randy: We don’t have any medical experience – and, in the end “engineering is engineering”. We have consulted with several doctors, had extensive exchanges with the team at Rice, and consumed all the information which is out there. I’ve shown our prototype to a number of doctors and they gave me advice as to how things can be improved. But essentially a medical machine is like any other machine. It's a collection of parts that we need to source or manufacture in house and we need to assemble it. We have in-house 3D printing capabilities, CNC equipment. And that we're very, very good at.
Torsten: Do these devices need to be certified by the FDA before they go into the field?
Randy: I've begun to navigate the FDA. They have empowered companies to manufacture various medical devices under what's called EUA or Emergency Use Authorization. Ultimately, the EUA allows us to build and sell while we’re working with them on the certification. We have hired a consultancy to help us with the paperwork. They are working to file what's called a 5-10 form (FDA 482c Notice of Inspection). We will have roughly three months to get approval and can sell it under the existing EUA.
Torsten: Speaking of selling, who are your customers?
Randy: That's a great question and something I'm not quite sure of yet. I am talking to anybody who will listen. And, also to some people that won't listen.
We think we have a lot of potential customers. We're in the middle of the Brooklyn Navy Yard with a lot of medical facilities around us. Hospitals are being asked to stockpile ventilators - a few hundred for each institution. They are all currently evaluating what the best unit is to buy.
Now, I can't claim that our unit is exactly the same as one costing 10 or 20 times as much. But I can say that it's a perfectly acceptable unit that we have tested it for 96 hours of continuous operation. They're small and portable and they can be used in an ambulance. In my opinion, the use goes beyond COVID-19, too.
We had the Brooklyn Hospital Center visiting yesterday. They sent over some of their senior doctors and staff to look at the machine. They were quite impressed.
Torsten: Are you willing to disclose for how much you’re planning on selling these devices?
Randy: Yes, $2,399 – which is less than a tenth of the bottom end of the range, that our President spoke about on TV. For that price, you will be getting everything but the intubation hose. That will be provided by the hospital.
"My concern is for Scenicorp and all the men and women who work for me; and their families."
Torsten: How long do you think you will be making ventilators?
Randy: Well, I'm actually hoping it's going to go on for a while. Number one, I think the event business is going to be slow coming back. My concern is for Scenicorp and all the men and women who work for me; and their families.
I'm kind of old school in that way. I think that business has a responsibility to their workers too. Help them keep food on the table. And the situation has been very stressful for everybody. So that's my first concern.
And secondly, if we can help the community by offering this lower cost device to save lives – well, what more could I ask for?
Torsten: You told me earlier that you think you will be able to make 30 devices per day. Will that be enough to “save” your company?
Randy: I think 30 a day would be a good start. We're planning to employ 20 people on the assembly lines. That's about half our full-time staff. There's staff that we can employ as well as a utility. For example truck drivers, picking and handling, setup. I think once we're up and running at 30 a day, we're going to want to add a second or possibly third line just to keep up with demand.
Additionally, we have some retail-related business coming up and we certainly hope that TV production will ramp up soon. So, all in all, it looks like we will be able to manage.
Torsten: I love the fact that you didn’t just see an opportunity and jumped at it simply to make money with it. You’re helping your workforce to be able to provide for their families and you will help the community to ultimately save lives. I think it's a very honorable thing to do and it's a fascinating story of perseverance. I wish you great success.
Randy: Maybe it’s an NYC thing! Thanks for spending your time with me today.
The ventilators are being marketed via Personal Breathing Machines Inc., which was set up just for this purpose. Personal Breathing Machines Inc. can be found on Twitter, Instagram, Facebook, and LinkedIn.