By Eric Peterson | Feb 15, 2021
Colorado Springs, Colorado
Electromagnetic pulse (EMP) shielding products and services
When it comes to electromagnetic pulse (EMP) shielding, Jaxon is a one-stop shop. "We do everything from design, testing, maintenance, construction," says White. "We're the only turnkey EMP services provider in the world."
Jaxon's beginnings were seeded by the U.S. Department of Defense opening the military's supply chain to smaller manufacturers. "My dad and I worked together for about 10 years at L3 Communications," says White. "That was about the same time the Small Business Act of 2010 came out. We had been hearing in the defense space that a lot of the contracts that were previously getting as a big contractor were going to go to small businesses. We started up Jaxon in 2009 to position ourselves for some of those small business contracts."
There was an ulterior motive, he adds. "To be honest, we started it as a quality-of-life alternative. We worked at a big business and wanted to drink coffee with a bunch of A-player friends of ours."
Jaxon launched with nine employees and a contract with the U.S. Air Force. The focus has always been squarely on EMP shielding. White refers to the 2001 reboot of Ocean's Eleven, when Don Cheadle's character uses "the pinch" to cut power on the Las Vegas Strip. "In Hollywood, it gets a little bit bastardized," says White.
In the real world, a big solar flare or a nuclear explosion in near-Earth space could unleash "a huge spike" of EMP energy and ravage the grid. "It just blows out a lot of equipment," explains White. "Computers, TVs, gas pumps, distribution networks, the power grid, utilities, water -- basically, a real version of Y2K."
Prevention comes in the form of "hardened communication nodes," which he describes as metal boxes with the right portals for people, air, and electricity. "All you have to do is have a metal box welded together -- it's kind of like ship welding: You can't have any pinholes or anything like that," he explains. "You have to have three things come in and out of that box: You have to have people, so you have to have special doors. The second thing is you have to have air come through so you do that with special vents that are called waveguides. . . . The other one is electrical filters, whether it's power or signal. We put all that into a shielded enclosure, whether it be brick-and-mortar or a fabricated structure."
Jaxon -- the name a play on that of White's son, Jackson -- started as a government contractor focused on engineering and maintenance, then moved into construction in 2014. "Some are as big as 10-story facilities, and there's massive shielding that goes inside of them, or it can be as small as component-level hardening, where you're just trying to shield a rack," says White. "The concept's the same: All you're doing is building metal boxes, welding them together, and putting those three elements on it."
After relying on contract partners, Jaxon started fabricating hardened structures in-house in 2018. "We build the frame, we put all the shielding in, we put the doors and vents in, and we integrate the box, so it has generators on the insider or racks that need protection, then we finish it out and put it on the back of a semi and deliver it to a final location."
The pivot to fabrication has catalyzed the operation -- fabricated structures now account for about 45 percent of Jaxon's sales -- and creates jobs based in Colorado Springs. "Our guys have traveled millions of miles over the last 10 years," says White.
To accommodate the growth, Jaxon moved from a 21,000-square-foot space into a 60,000-square-foot building in November 2020. "We have 40,000 square feet in the back that's high-bay, 24-foot clear height where we've invested about $1.5 million in capital. We've got a 60-ton bridge crane, we've got compressed air brakes, we've got huge roll-up doors so semis can back into our space and we can drop these structures on the back. All of it was designed to allow us to handle more volume. . . . It's been a game-changer."
In the EMP world, White says Jaxon is unique in that it's privately owned by the key management team (he bought his father out in 2017 so he could retire) and largely vertically integrated with a "holistic" set of EMP services.
"There's a lot of benefits, especially from the DoD perspective," says White. "As opposed to doing a design-build bid project, where they go design it, send it out for bids, and a bunch of people compete for it, and they chop up all these individual contracts, we're positioned to do all of that at one time."
About 90 percent of Jaxon's business is DoD contracts, with the remaining 10 percent in commercial projects. Annual revenue has risen to about $25 million, and White says he expects it to double to $50 million in 2021, and the company could hire about 50 new employees by summer. "We have a substantial ramp-up," says White. "We've got the facility to do it. The harder challenge is scaling specialized labor in order for us to have quality results."
Challenges: "The biggest challenge for us is sourcing quality talent," says White. "We thought COVID was going to create all these opportunities with unemployment on the rise. There were some open requisitions for us to hire welders and electricians that took us two months to fill."
The turnkey approach makes it even tougher, he adds. "From a personnel perspective, you have to have a broad labor mix. We've brought everything in-house . . . security, HR, accounting. We even have travel in-house. We do marketing, contracts, administration. All that stuff's handled inside Jaxon; we don't outsource that."
"We've got electrical engineers, mechanical engineers, civil engineers. We've got physicists. Even our welders have secret or top secret clearances with certified welding experience."
It all comes back to a niche where reliability is paramount. "In our industry, you can't have bad quality go out the door," says White.
Opportunities: The commercial market. White notes that the pipeline is about 80 percent military projects, and he expects Jaxon's commercial business to grow at a more rapid rate as 5G providers and modular data centers look to bolster their infrastructure.
"There's no federal legislation right now that requires commercial hardening," says White. "So as a result, that market's very young."
Legislation could spur the market in a big way, he adds, but big utilities are proactively investing in hardening. "It's so hard to reconstitute the power grid, they really need to get it done."
The entire EMP industry would need to scale to harden the U.S. electrical grid. "We're probably in the top three service companies in the country that do what we do, and we only have 75 people," says White. "So, if anybody was like, 'Hey, let's harden the Colorado power grid,' it'd be too big for us to even handle."
"We're working with some big power companies right now. They have some very big infrastructure needs. Even if we just served one or a couple of those over the next 10 years, it would probably triple if not quadruple our business, if they were to put the kind of money behind it that they need to."
Needs: White says he needs to maintain Jaxon's culture -- with perks like food truck Fridays and poker nights -- as the company grows.
"We've been big on culture," he says. "We built a huge patio, fire pits, grills. We built a bar inside of our place, just so people can have a beer after work. . . . It's all strategic for us. It's one thing for us to be able to hire top-quality talent, it's another thing for us to retain it."
The company has grown from nine employees to 75, and hired about 20 in 2020. "If we get to 125, 150 [employees], our biggest need is trying to address culture," says White. "We need people, but I think even more than that, we need a connected culture here that makes it fun and all the things that people like about a small business."
"People get distant, and everyone has their own little groups they hang out with -- then people don't talk as much and they don't share information, and the business starts to lag," he adds. "You have to stay ahead of it. That's the hardest thing about culture. When it's too late, people are starting to walk out the door."