Crestron Electronics: A Made-In-America Success Story
In a quiet corner of Crestron Electronics’ cavernous Rockleigh, N.J. research lab, an aged engineer hunches over a chaotic assembly of plastic tubes, spinning motors and wire. He flips a switch and an exhaust pipe spews a plume of white mist. “This is my Rube Goldberg machine,” says George Feldstein, with an impish grin. “I always have to keep my hands busy. Not bad for a CEO, huh?”
At 70 the founder of Crestron Electronics—maker of myriad home automation devices—is as fit and energetic as a man half his age. He’s also a tireless tinkerer, with 14 patents to his name. His latest project—a more efficient humidifier—has been in the works for over a year. Typical evaporative humidifiers require water tanks (breeding grounds for bacteria), while the steam-injection variety gobble electricity. So Feldstein invented a system that pressurizes a small amount of water and pushes it through tiny nozzles, atomizing it into vapor. When he tested it in his home last winter, the mist left a dusting of salt all over the furniture. (“My wife nearly threw me out,” he says.) With any luck the boss’ latest invention will hit the market next year.
Feldstein doesn’t just create gadgets—he creates jobs. As protesters, pundits and politicians bemoan corporate America’s addiction to cheap overseas labor (the manufacturing sector now employs 11.8 million people, down nearly 40% in three decades), Crestron has added 500 people—20% of the company’s workforce—in the last five years.
Feldstein owns 100% of Crestron, which could very well make him a billionaire. (He won’t comment on his personal fortune.) Based on sales of similar companies over the last few years, Crestron, which carries no debt and pulls in $500 million in annual revenue (on its way to our list of largest private companies), could be worth at least $1 billion. Yet somehow Feldstein has attracted little attention outside of the trade press, even as he provides new jobs by the hundreds in a prolonged downturn.
“I have great belief in American enterprise,” he says. “When the economy went south we brought everything in-house and paid more for it, rather than lay people off. People don’t realize the importance of the continuity of labor.”
Translation: This isn’t about patriotism—it’s about strategy. By manufacturing 80% of his products—1,500 in all—in the U.S., Feldstein says he is able to build technologically complex devices in low quantities with few errors. Hiring at home also allows him to develop the kind of long-term, committed help he needs to keep expanding. Even with the company’s latest growth spurt, Feldstein estimates around 15% of his workforce has been on staff for at least a decade. “We bring in people, and we give them a profession,” he says. “It’s one of the most important things about a job: It should provide a career for people who want them.” And by keeping Crestron privately held, Feldstein doesn’t have to answer to pesky analysts and shareholders who might have him cut costs by shipping production overseas.
Oh, and in case you’re wondering: Crestron isn’t for sale. “To anyone who asks, the answer is no, not how much,” barks Feldstein.
Crestron’s success story is little-known outside of northern New Jersey, but its electronic control systems are everywhere: automated light, sound and temperature controls for luxury homes; fancy digital screens and speakers for conference rooms; surgical-camera controls and displays; classroom projectors; digital signs and retail displays; and even remote controls for hot tubs aboard luxury yachts. The company’s equipment orchestrates conference rooms at Microsoft’s headquarters in Redmond, Wash. It’s in seven out of eight Ivy League schools; in the penthouse of the Trump World Tower in New York City; and in a situation room at the Pentagon.
Crestron sells its products through a small army of 15,000 independent partners and dealers—tiny home-theater vendors to major home builders—backed by an internal sales, customer-support and marketing staff in 57 offices spanning 45 countries. Feldstein’s central operations are scattered around Bergen County, N.J., a 30-minute drive from New York City. Its Rockleigh campus houses corporate management, manufacturing, training facilities and a 100,000-square-foot research center. The previous headquarters, in nearby Cresskill, has become an automated preproduction plant, where Crestron assembles circuit boards used in its products.
That’s some serious infrastructure for a company started in a room above a Cresskill delicatessen. “I had no money, four kids, a mortgage and a Dodge Dart,” says Feldstein. “My capital equipment was my own tools. Now we have two jets and a worldwide business.”
Feldstein grew up on Manhattan’s Lower East Side, where his father worked as a sewing machine operator. Young George showed an early aptitude for engineering, winning a citywide physics competition at 15, and went on to earn a master’s degree in electronic engineering from New York University.
After graduation he landed at a firm that built industrial-control-and-testing equipment, working as chief engineer. In 1969 he had a falling-out with the boss, who fired him. (“They went out of business a year after I left,” Feldstein recalls.) The spat convinced him to never work for someone else again. “I came to the realization that I’m not employable, that I never would get along with another boss,” he adds. “So I started a company.”
In the beginning Feldstein cold-called businesses, offering to build or repair whatever they needed. Crestron’s first job, for Colgate-Palmolive, was a laser-leveling device that helped automated assembly lines put the right amount of powder in boxes of detergent. By 1973 work was steady enough to hire an employee. Two years later the company moved into a commercial garage, where Feldstein whipped up everything from bank deposit machines to human-nerve stimulators. “I did anything to make a buck,” he says.
Business really started to pick up after Feldstein developed a wireless remote for commercial audiovisual systems. Then came audio switches, video projectors and lighting control panels. By 1990 Crestron had 100 employees and generated almost $5 million in revenue, much of it from selling integrated audiovisual systems to companies, colleges and casinos. President Clinton had Crestron’s SmarTouch line of touchscreen remote controls installed in the White House.
As the company grew, Feldstein faced a different kind of challenge: letting go. “A lot of people have total control as they build a company up,” he says. “And then when they don’t, they have all these problems.” Feldstein relied on what he calls the “black marble” theory: If you don’t know what’s in a jar but you reach in 20 times and pull out 20 black marbles, it’s safe to assume the jar is full of black marbles. The same is true of employees: If every time you check on them they’re doing well, they’ll probably keep doing well without you. However, says Feldstein, “If I detect something’s wrong, I’ll spend a lot of time focusing on that.”
That balance of vigilance and trust propelled revenue to $25 million by 1997. Betting on the right customers—specifically, high-end homeowners—helped, too. When the dot-com bubble popped, Feldstein’s core audience still had money to spend. By 2004 Crestron had 500 employees and $170 million in sales. Today Crestron gets 40% of its top line from customers who don’t flinch at spending $50,000 on a home theater setup.
One banking executive (who would rather remain anonymous) bought a 4,500-square-foot residence on the top floor of the Montage Hotel in Beverly Hills. It was already wired with basic Crestron controls, but the buyer wanted “the ultimate bachelor pad.” Roughly $245,000 later, Crestron dealer DSI Entertainment Systems had equipped the apartment with the latest in lighting, climate-control and home-entertainment gear. In one room projectors turned a 35-foot-diameter domed ceiling into a massive video screen. The client can also change the color of the fireplace—made of onyx and backlit with multicolor LEDs—according to his mood.
His customers might be flashy, but Feldstein is not. He holds management lunches at a local diner; wears button-downs and slacks to work; and rides his bike 40 miles a day (weather and work permitting), up to Bear Mountain or along the Hudson River. A licensed pilot, he has been known to take customers for a spin in his Extra 300L aerobatic monoplane, and on occasion he’ll fly the company jet to make service calls. “When I started this business, I used to sit by the phone all day and wait for it to ring,” he says. “I appreciate my customers.”
Crestron is a family affair. Feldstein’s son Dan, 39, is vice president of operations and daughter Wendy, 44, is director of engineering services.
“Although my name is not Feldstein, he has been a father to me,” says Randy Klein, a 21-year veteran of the company, now executive vice president and chief operating officer. “He’s technically my ‘boss’ on the organization chart, but he has always treated me as an equal. We learn from each other.” The biggest challenge of working for George Feldstein, according to Klein? “Keeping up with him.”
Feldstein often patrols the Cresskill preproduction plant—partly to keep a watchful eye but also because he just can’t help himself. “I spend probably an hour a day at my desk and the rest of the time running around,” he says. “I don’t understand a CEO who runs a car company and doesn’t know how to make a car.” Inside, rows of laborers in protective blue coveralls assemble circuit boards. Even the simplest tasks—inserting components into a board and soldering them in place—require skill and precision. More delicate work, like operating one of two Panasonic high-speed chip-placement lines, takes plenty of expertise.
During one visit Feldstein stops to issue light warnings to assembly-line workers who hadn’t clipped grounding wires onto their clothing. It’s a minor infraction but a potentially serious one: Ungrounded workers could damage a circuit with static electric discharge, the same way you get a shock from a metal doorknob. (When his new humidifier is completed Feldstein plans to install a few in the assembly area, where static charges tend to build up in dry air.)
Experienced assembly-line workers earn $17 an hour, more than double the state’s $7.25 minimum wage and better than the $14.90 State of New Jersey average for electronic equipment assembly jobs. Employees receive medical coverage, a 401(k) plan “and real coffee ground from real beans,” boasts Feldstein. Most of the workers are Hispanic women who hail from working-class neighborhoods in north Jersey, Brooklyn and the Bronx; many hold down two jobs. “We’re trying to set up a bus to bring people here from the city,” says Feldstein. “We’re always hiring, so we don’t have enough parking.” Feldstein spends about $1 million a year developing employees, teaching them new assembly techniques and helping them obtain safety certifications. “Most of our management comes from people who started at a lesser job, including some of our vice presidents,” he adds.
A far bigger chunk of the company’s budget, roughly 15%, goes toward development of new gadgets. Energy-management devices are especially hot, given the rise in electricity and gas prices. “The market perception of Crestron is still very luxury-oriented,” says Konkana Khaund, an analyst with technology consulting firm Frost & Sullivan. “But if they can spin this energy story, it will open up whole new areas for sales.”
Craig Foster, senior analyst at ABI Research, a market research firm, thinks the home-automation trend will only accelerate—and not just among Hollywood executives. Foster estimates that worldwide shipments of everything from sensors to servers should rocket twentyfold to 12 million units by 2016.
Energy management is a piece of the automation story, but there are more powerful trends at work. Apple has sold 150 million iPhones and 40 million iPads; throw in competing smartphones and tablets, and Crestron and its competitors have a soon-to-be-ubiquitous built-in interface for their products.
Better yet, their distribution channels are about to get a lot bigger. Telcos, cable companies, security outfits and energy utilities are starting to roll out new bundled-automation packages. In October Verizon launched a home-monitoring service powered by startup control-maker 4Home. iControl Networks, another home-automation firm, has inked partnerships with Comcast and ADT Security Services.
Even more critical to Crestron’s future, perhaps: What happens when Feldstein finally runs out of steam? “The succession plan is essentially, ‘Everyone keep doing what you’re doing,’” he says. Klein, 59, will likely be tapped as CEO.
Until then Feldstein will keep tinkering: “I don’t plan on retiring. Even on the weekends I get separation anxiety.”
This story appears in the December 5, 2011 issue of Forbes Magazine.
As Crestron marks its 50th year in business, here’s a look back at the people behind the company’s continued success — and the philosophy of the leadership team that drives it.
Ray Coneys remembers George Feldstein as a Renaissance man: “He was a pilot, he loved cycling, he loved crew [rowing], and he had a tremendous interest in history.” Coneys recalls that Feldstein, the man who founded Crestron in a room over a Cresskill, New Jersey delicatessen in 1972, was especially fascinated by military history. “No matter how you feel about it, the fact is that military technology often drives technological advancement.” George Feldstein was equally fascinated by NASA’s Apollo program — his thirst for knowledge was nearly unquenchable, and he was always eager to share what he'd learned.
The business that George Feldstein began to craft 50 years ago, driven by his boundless curiosity, led to the evolution of a company that now boasts 90-plus offices around the world. Today Crestron’s technological solutions can be found in the boardrooms of the world’s largest companies and most luxurious homes. They’ve been installed in the Pentagon and the White House, in courtrooms and classrooms, and even major-league sports stadiums.
Coneys joined Crestron in 1990 and has since become vice-president of sales enablement. His memories of Feldstein as an extrovert driven by his “need to learn/need to teach” are especially vivid. “George would ride his bike, say, to a shopping center, and strike up a conversation with a young person rounding up the carts,” says Coneys. “Before you knew it, he was offering them a job at Crestron. It used to drive some of the execs crazy, but if you had an interest in what Crestron was doing, he’d find you work.”
Feldstein had a uniquely American perspective on creating a team, and according to Coneys, that vision was shaped by what he observed during World War II. “George loved the idea of America as ‘melting pot’ — we went to Europe with our shirts untucked and our helmets tilted to one side, and we beat the bad guys with the big guns,” he says. “How? We were innovative. We were the ultimate team players.”
And Feldstein imbued that notion — that idea of the American innovator and team player — into the DNA of the company he founded.
Dan Brady, Crestron’s COO, echoes Coney’s sentiments. “This company is about innovation, but innovation is always driven by people,” he says. “George always valued the individual contributions that all these brilliant minds brought to the table. He empowered them to experiment, to make mistakes, and to learn from those mistakes.”
The First Big Hit
In the company’s early days, Feldstein cold-called various firms, pitching his services as tinkerer, repairman, and problem-solver. But there is a through-line that runs back to the company’s first big “hit” to the present day: a drive to make technology easier to control — wirelessly.
“The stepping stone into audio-visual was slide projectors,” says Coneys.
Yes, there was a time before PowerPoint — and slides were just that, slides that sat in a carousel in a projector. The best way to present a combination of data and images was to gather one’s colleagues in a dark room, pull down a display screen, and fire up the slide projector. Feldstein saw an opportunity to refine this presentation tool. “The slide projector control went beyond just forward and advance; it also included fades and dissolves; you could incorporate multiple stacks of projectors into a timed presentation,” Coneys remembers. That interest led to controlling not just the projector but drawing the shades in a conference room remotely as well — and ultimately achieving more and more functions without cables.
“When I joined the company in 1990, Crestron already had a two-way, bidirectional RF touchscreen,” says Coneys. The product was big, it was clunky, but it worked. “In situations where you couldn't run a cable to a high-end meeting room, table, conference room, or a lectern, you could still have a touchscreen, and it would be wireless,” he says. Shortly after Coneys was hired, the company began delving into adding color to those screens and refining their control systems further. “At that time, touchscreen controllers were black and white. George simultaneously released the first color touchscreen with a video window: You could have a feed going to the touchscreen and display a video preview on this color touchscreen.”
Feldstein’s vision extended into every product, says Coneys. “We were the first control system that had an ethernet port,” he recalls. When that feature was added, ethernet had yet to be accepted as standard. The same was true of HDMI — Feldstein was one of the first to understand that HDMI would become the digital replacement for analog video standards.
“To this day, if you look at our products compared to competitors, we're typically way ahead as far as our network standards,” says Coneys, “including the security protocols that we support, because we made a decision to do that. We were early adopters of that.”
The Ups and Downs of a Business
Like any business, Crestron was challenged to weather downturns. Coneys’ early days with Crestron saw the firm running to catch up with its competitors. “Randy Klein joined the company the same year I did,” he says. Klein refocused on making customer feedback Priority One, and the input of the late, longtime CTO Fred Bargetzi, helped the company regain its edge. Through the dot-com bubble burst in 1999, through 9/11, and through the Great Recession, Feldstein “never curled up in the fetal position,” according to Coneys. “He invested money, and he hired people in engineering, and so we came out on the other side with the digital media technology that grew into our DM NVX, AV-over-IP products,” he says.
Feldstein would turn over the reins to Randy Klein in 2014, and Klein would eventually face his own challenge as CEO when the global pandemic hit in early 2020. When Klein retired last year, CE Pro noted his leadership through the lockdowns:
Klein recently shared that the company designed [more] new products during the shutdown than during any other time frame. The company’s broad portfolio covers technology for conference rooms and corporate facilities, UC controls and displays, campus systems, hardware devices for partners such as Microsoft and Zoom, and automated lighting, audio, video, and environment control for luxury homes and yachts.
That can-do attitude is present today. “Through these difficult times with the global supply chain issues that everyone’s facing, customers desperately want our products because they remain the most flexible, scalable, and reliable products in the market today,” says Brady. “And our people are working harder than ever to meet that demand — with absolutely no diminishment in quality.”
“This is exactly what makes Crestron so great: Everyone pitches in to solve problems, and we don’t deflect or yield,” he adds.
“I know from personal experience running our Advanced Technical Support Group for many years that I could always look a customer in the eye and commit to solving their issue,” adds Andrew Ludke, now a senior director of product management. “I could make this commitment because I knew I had the unwavering backing of the company — from the engineers and sales team right through to executive management.”
“Randy and Mr. Feldstein would tell us that if you did what’s right for the customer and the company, we couldn’t go wrong, and that’s proven to be true over and over again in my time here.”
A Family Business
Although it’s now a global business with billions in revenue, Crestron maintains a family atmosphere — which extends to its present leadership team that finds George’s son Dan at the helm. The younger Feldstein was ready to hit the ground running, as was noted in a company press release: “With a background in computer engineering, Feldstein spent the first decade of his Crestron career in R&D, playing a role in designing a number of the technologies Crestron still employs today. Since then, he has been working in Operations alongside Klein and former CTO Fred Bargetzi.”
Coneys recalls many members of the Feldstein family pitching in throughout his tenure. “The first summer I spent in Cresskill, Dan and David [Feldstein] came home from college and helped us full-time workers program Crestron systems.” George’s wife, “Mrs. F,” as she was known, led the accounting department. Wendy Feldstein began in the drafting department before becoming a vice-president of design. Anne Baretz (nee Feldstein) joined — and grew — the legal team. “All of the second-generation family members who joined Crestron invested time in the company before being ‘officially’ brought on board,” says Coneys.
Although George Feldstein has since passed, Coneys sees the founder’s values reflected in the company as it marks 50 years in business. “George Feldstein really loved our customers and always invited them to come into the factory. He loved showing it off and then getting feedback and ideas.
“He worked with a lot of brilliant minds in our industry to help influence the development of our products,” Coneys adds. “Feldstein was open to that; it was part of his genius.”
Dan Brady sees the younger Feldstein embracing those very values George Feldstein held dear: “Innovation, quality, and maybe most importantly, humility.” That’s only achieved when a leader puts the customer first — and strives to create the perfect solution for that customer. “That extends beyond engineering,” Brady notes. “That ethos extends to production, distribution, marketing, sales operations, even accounting.”
“And that philosophy really hasn’t changed at all.”
A Quick Crestron Timeline
1972 — Crestron is founded in Cresskill, New Jersey.
1975 — Feldstein incorporates the firm Crestron Electronics.
1980 — Crestron’s first dedicated HQ is constructed in Cresskill.
1997 — Crestron moves its HQ to Rockleigh, New Jersey, purchases several buildings for its research center, and hires more than 400 engineers.
1998 — The Crestron Certification program begins.
2002 — The Crestron Masters program is introduced.
2009 — Crestron opens its 8,000-square-foot "Experience Center" in New Jersey.
2014 — Randy Klein becomes CEO. George Feldstein passes later that year — with more than 70 patents to his name.
2021 — Dan Feldstein takes over as CEO upon Randy Klein’s retirement.
2022 — Crestron marks its 50th year in business with more than 90 offices across the globe.