10K80 by Kyle Nguyen March 24, 2022
Who would’ve thought MRIs, audio, and music would cross paths? How do you ease the worries of a hospital patient strapped inside of a whirring, radioactive magnetic tube?
It’s a puzzle that MRIaudio CEO Spencer Howe set out to crack as a bright-eyed college graduate in his parent’s garage just over a decade ago.
The pieces have since fallen into place, and the Carlsbad-based entrepreneur has swept the fruits of his labor into the imaging rooms of over 1000 hospitals and health clinics worldwide.
After a statement year that put MRIaudio on the map with its patient-driven technology, the intrepid entrepreneur spoke of the values and experiences that road mapped his entrepreneurial journey to success.
Spencer Howe’s MRIaudio is making strides in a niche of medical technology focused on improving patient comfort.
Once a solo act without a dime of venture capital to his name, Howe now presides over a multi-million dollar company that posted $3,500,000 in revenue by the close of 2021.
MRIaudio has sold more than 3,500 units of its flagship technology to a clientele of leading health service centers including Sharp & Children’s MRI Center in San Diego, Scripps Memorial Hospital, UC San Diego, and Rayus Radiology.
A marquee partnership with GE Healthcare over the past year alone tripled MRIaudio’s business “overnight”, Howe says.
More significantly, for the Carlsbad-based founder, the numbers represent the realization of decade-long efforts to improve the quality of patient accommodations in an industry already rife with tragedy and life-changing moments.
“MRIs are considered to be an uncomfortable procedure. A lot of patients get anxiety and claustrophobia,” Howe said. “The presence of music and communication help alleviate that stress when a patient is undergoing an MRI scan.”
Magnetic resonance imaging is one of the most frequent procedures done by diagnosticians across the country. The average MRI center may scan anywhere between 10 to 20 patients per scanner.
“If you assume that each system we’ve sold helps 10 people per day, we help 30,000 patients each day complete their MRI scan and reduce the number of patients that require a sedative,” Howe said.
MRIaudio is not the first or only company to tackle the issue of integrating audio systems into MRIs. However, up until now, delivering audio to patients has come at the cost of sound quality due to the engineering challenges involved.
“An MRI at its basic level is a giant magnet. Most traditional headphones use magnets to create sound. So traditional headphones are not MRI compatible,” Howe said. “Most other companies that make MRI sound systems use piezo ceramic speakers which are MRI compatible because they are non-magnetic, but they only produce high frequencies.”
“This compromises the sound quality the patient hears,” he said. “I wanted to create a system that produces a full frequency response: high frequencies and low-frequency sound, bass.”
Howe consulted with a career audio expert who had plied his trade at Bluetooth speaker company JBL Audio. The pair sifted through ideas before settling on an older piece of engineering: tube television.
“Back when tube televisions existed, the magnetic speakers on the sides of the TV would interfere with the picture,” Howe said. “As a solution, the engineers building these tube TVs actively shielded the speakers.
This means using an opposing magnet as a shield on the speaker which significantly helps cancel out the magnetic field.”
It was a perfect fit for what MRIaudio wanted to achieve. A test run carried out by a speaker manufacturer confirmed that the engineering was sound.
“As it turns out the lower frequencies produced by the actively shielded speaker did a much better job masking the cacophonous sounds produced by the MRI,” Howe said. “With our MRIaudio system, the patients could better hear the music which reduced their awareness of the loud noises produced by the MRI.”
The breakthrough on full-spectrum audio delivery to patients during MRIs has garnered plaudits from the medical community.
Radiology Supervisor at Mount Nittany Medical Center Sherry Piper says that her staff at the facility’s Outpatient MRI center has “not stopped raving” about the system’s effectiveness and breadth of functionality.
“This system has proven to be the best MRI system that I have used in my 30-year career,” Piper said. “It provides adequate volume, even for people with hearing issues. It provides a vast selection of music including Pandora, I-Heart, Tune-in Radio, and Podcasts.”
The veteran radiologist was also impressed with the service provided by Howe and his team.
“Spencer was extremely helpful from the first phone call to the end result,” Piper said. “The pricing was excellent and they worked with our schedule to complete the installation.”
For Howe, customer service is the lifeblood of his company and his identity as an entrepreneur and founder.
“I joke with MRIaudio team members that we are a customer service company that just happens to make MRI sound systems,” he said. “Quality customer service means delivering what you promise and continuing to take care of the customer after the sale is made.”
MRIaudio provides a 30 day trial period for customers weighing whether or not the audio system is the right fit for them.
“If a prospect decides not to keep the system, the invoice is voided,” Howe said. “The only customers who move forward are the happy ones.”
The company also offers complimentary installation. Howe was frank in his assessment of the policy.
“We don’t make money off of installation, but it makes the customer’s life easier,” he said. “Our motto is to make the customer’s life as easy-as-possible.”
Howe has made it a point to make every aspect of his customer experience as convenient as possible. MRIaudio will also replace a broken component after warranty expiration overnight for free, for example.
“It is both satisfying and promising to hear a customer say ‘wow are you serious, that was so easy, thanks!’” Howe said. “And the next time they need to buy another MRI sound system, they call us.”
Howe says that customer service is an underrated tool to garner success as an entrepreneur, especially as a means to subvert catastrophe and create winning opportunities.
In one incident, a trusted customer — a mobile MRI distributor who outfits his fleet with MRIaudio systems — had been working with a major Boston hospital that had already been set back by other technical issues.
Tensions had already come to a head when the hospital reported that their MRIaudio system stopped working. With his reputation on the line, the distributor contacted Howe directly.
The CEO immediately helicoptered to Boston later that night to personally troubleshoot the system.
“The only issue with their MRIaudio system was that one of the cords had become disconnected,” Howe remarked. “It took me less than 10 seconds to fix it.”
“That same very large hospital in Boston was so elated… that they bought 7 more MRIaudio systems,” Howe said. “Even though I knew I could help repair the system with phone support, they wanted me onsite. I obliged and showed up with a positive attitude — I consider this to be a win/win deal.”
It’s one of the five core values that Howe has hammered into the fiber of MRIaudio’s identity.
“When you walk into MRIaudio’s office the first thing you see is our company logo and our 5 core values,” Howe said. “Every employee knows these core values and they are an integral part of decisions we make.”
Win/Win: “Every deal should benefit both parties whether that be with a customer, a supplier, or internally.”
Teamwork: “I am a huge believer that if you want to go far you should go together. Everyone has different strengths and weaknesses. Working as a team keeps everyone aligned and aware of what is going on outside their department.”
Simplicity: “I believe that the easier a product is to use and a procedure is to follow, the more it will be used. We try to make all of our products as easy-to-use as possible.”
Positivity: “Having a good attitude is critical to being successful. We spend most of our time at the office — we should enjoy it. That’s not to say there aren’t hardships at times, but facing a challenge or an obstacle with a positive attitude helps improve the quality of work and increases your chances of crossing the finish line.”
Celebration: “I believe that both big and small victories should be celebrated. Whether that be a high five, a company barbeque, or some other form of acknowledgment. We have a Gong in the office that people are encouraged to ring; for example when a sale is made or a big order is shipped.”
Each value goes a long way in fulfilling the basic requirement of customer service that has been the bedrock of MRIaudio’s story. Howe hopes that the wider corporate culture will one day adopt similar standards of customer care.
“Personally, I often feel disappointed with the customer service I receive and I don’t think I am alone with my feelings on the standard of customer service we’ve gotten used to,” Howe said. “I think often as companies grow, they try to cut as many costs as possible to increase their bottom line. I imagine they mistakenly see cutting customer service costs as an opportunity.”
Customer service satisfaction has been dropping since the start of the 2010s, according to a report by the American Customer Satisfaction Index.
“I think that skimping on customer service is short-sighted because you will eventually lose your customer base and damage your brand. I would argue that current customers are more important than new ones.”
At the end of the day, the experiences of customers or patients are a direct representative of the trials and tribulations Howe had to overcome to build MRIaudio to what it is today.
A trip to the University of Wisconsin was enough to assure Howe that what he had set out to do was worthwhile.
“I was on-site while they were scanning a patient. The patient successfully completed their scan and thanked me afterward for installing an MRI sound system,” Howe said. “She was extremely complimentary of how the music helped her complete the MRI scan without needing anti-anxiety medication.”
“To me, this is confirmation that the product really helps patients and serves its purpose.”
The founder is already thinking about how to further improve the patient MRI experience. The company is working on an MRI-compatible display so that patients can watch video entertainment during scans.
Amidst the whirlwind of his company’s recent success, Howe loathes to forget where it all began: the nebulous days when even selling just ten audio systems seemed like a distant impossibility.
Reeling from a dissolved partnership and working without venture capital, Howe had very little else to rely on other than himself while navigating through the genesis of MRIAudio.
At its conception, the company flew under a different moniker. Global Imaging Source, Inc, was founded as an MRI parts brokerage company by a college friend of Howe’s at the University of Colorado Boulder.
It had seemed like a perfect union. The pair was on a balcony of a mutual friend’s wedding when Howe’s friend made the proposal to work on a new business idea together. Intrigued, Howe accepted.
The idea of an MRI audio system drew them together, but after several disagreements, the pair decided to part ways, with Howe plowing ahead with the project despite having no experience in the medical sales industry, he says.
The young entrepreneur was left with just an idea, a machine, and an open room to work with.
“Every day was hard and uncertain at first,” Howe said. “I had to figure most things out on my own, without damaging a multimillion-dollar MRI machine — fortunately, I never did — I had no capital and was building the systems in my parent’s garage.”
Despite the novelty of the challenge, he was determined to prove that he had the frame of mind to plow through. “I have always had an entrepreneurial mindset — MRIaudio is not the first business I started,” Howe said.
He first ran a business earlier in his college career as the owner of a house-painting franchise for College Pro Painters.
“I didn’t make very much money, but I did get a firsthand education of how businesses worked,” Howe said. “This motivated me to start another business. I was actively seeking another opportunity.”
And so with no capital and a steep learning curve to scale, Howe set to work to make the most out of the opportunity he had.
Howe used whatever he could get his hands on to build his first MRIAudio systems. An old computer speaker. An amplifier. A bundle of standard cables. A desktop microphone. Whatever he couldn’t salvage, he built on his own, though he was beginning to discover the limits of his resourcefulness.
“The primary system component is called an audio transducer which I had to custom design,” Howe said. “I built the first transducer out of pinewood. I knew a hospital would never purchase it and that it needed a more professional appearance.”
Bridging the gap in manufacturing quality was a necessary step, albeit an expensive one for a company without any venture capital.
Howe pinged his collegiate network, hiring a student from ITT Tech career services to design a CAD (Computer-Aided Design) speaker box. With the blueprints in hand, he pitched his project to roughly 50 different manufacturers over the internet.
Scrolling through quotes ranging up to $50,000, he began to feel discouraged. Then he spotted a $5000 quote from a family-owned factory in Tecate, Mexico. Howe grabbed his passport and drove down to the Mexican border from San Diego.
“One of the brothers picked me up and drove me to their factory about 10 minutes away,” Howe said. “I explained my situation and that if this product worked I would continue to order and we agreed on a total price of $3,500 for ten transducer speaker boxes.”
The deal was on after he field-tested the system’s compatibility in a local hospital. With the product coming together, Howe began to tend to other elements of his business, doing whatever he could to save funds along the way.
He spent late nights on his website to bridge the time difference working with a web developer based in India. He tapped a fellow student to design the company logo and used vista print to print business cards and brochures.
Sensing the markings of a proper business coming together, Howe turned his attention to cold calling and traveling to trade shows over the next year. The process, however, proved to be one of the most harrowing experiences of his entrepreneurial journey.
“Cold calling was free and I had plenty of time,” Howe said. “Anyone who has made cold calls knows it can be discouraging. The idea of starting a business was extremely exciting, but my initial sales proved to be more difficult than I thought it would be.”
In its first year, MRIAudio posted just $40,000 in revenue. At that point, Howe had little to no established clientele or feedback to gauge whether or not his efforts would come good.
“I spent almost all my time in my first year in business making cold calls. There was so much uncertainty whether MRIaudio would be successful, or whether I was wasting my time. I didn’t know if I priced the equipment properly, I believed I had designed a good product, but that wasn’t confirmed by any customers,” Howe said. “I had faith it MRIaudio would be successful, but I was so discouraged at times that I felt like giving up.”
Howe attributes many of his hardships to the intrinsic difficulties of ‘bootstrapping’ or starting a company without any outside investment or venture capital.
“In a lot of ways bootstrapping is a harder road,” he said. “If an investor would have offered me money when I first started, I probably would have taken it, although I would have regretted it now.”
The entrepreneur says there are plenty of upsides to bootstrapping, although he admits that the perks aren’t necessarily immediately clear.
“When you bootstrap you don’t have money to do all the things that you want to grow your business,” Howe said. “You carefully have to decide what is absolutely necessary and allocate your money to that cause. Because of this, I probably didn’t waste as much money as I would have had an investor given me $100,000.”
Living at his parents’ home also left Howe with fewer financial obligations, which created easier conditions for him to bootstrap MRIAudio. Now living independently, Howe admits that having investors would go a long way in terms of being able to have steady income if he started another business now.
Still, Howe swears by the financial liberation of forgoing venture capital.
“If you can get through the growing pains of starting a company organically, bootstrapping is a beautiful thing,” he said. “You don’t owe anyone anything, you don’t have a board to report to, so you can focus on long-term strategy instead of worrying about short-term earnings.”
With just over a decade worth of experience building MRIAudio in the rearview mirror, Howe offered a word of advice for the next entrepreneurs.
“Nothing is ever as good or as bad as it seems,” he said. “There were a few times where I thought I was going to be an overnight millionaire, that did not happen.”
Howe likened his journey to a steady upward trend with lots of ups and downs. “Most of the time things aren’t as bad as they seem,” he said.
The founder encountered his own fair share of bloopers, each seeming just as catastrophic at the time.
“I had this idea for these electrostatic headphones that were MRI compatible. I thought these were going to revolutionize the industry and invested most of my money into them,” Howe said.
When the move didn’t pay off, he was initially gutted. “They didn’t work at all, but it wasn’t the end of the world, I got through it.”
Howe also recounted a test run for an MRIAudio-compatible microphone that would let MRI technologists speak to patients.
“Unfortunately, on very rare occasions the microphone became live without being triggered,” he said. “This led to a few patients hearing the MRI techs saying things that they weren’t supposed to hear.”
Howe was horrified. “I immediately resolved the issue but at first, I thought my business venture was over,” he said.
Howe says that similar potholes will always come up, but that it’s important to continue to plow through. The entrepreneur invoked his own journey from humble beginnings and overcoming roadblocks to that point.
“Problems usually aren’t as bad as they seem. You can work through them and find a solution and learn a lot in doing so.”