The World of Business

Beckman was being slowly drawn into the world of applied science outside of Caltech.  In addition to fielding inquiries made to the University, he began to serve regularly as an expert witness and as a private consultant.  Beckman worked extensively with a Los Angeles patent attorney named Leonard Lyon.  Southern California was an exciting place at the time, experiencing rapid growth and great opportunity, and so Lyon and Beckman had more than enough to fill their plates.  They were involved in proceedings all over the state of California, including one that almost implicated Beckman along with the defendants he was testifying against.  A group of fradulent entrepreneurs whom Beckman was testifying against attempted to debunk his testimony by claiming that he was their employee, but his meticulously kept diaries convinved the state otherwise. The extra income made the Beckmans very comfortable and eased their journey through the years of the Depression. 

Another opportunity presented itself in 1934.  National Postage Meter, a fledgling company in Los Angeles, was having trouble with ink clogging their postage printing machines.  They consulted Beckman, who quickly developed an ink whose articles of pigment would not settle out in solution.  His ink was effective, but it had an unpleasant odor and no established ink manufacturers would produce it.  With characteristic self-confidence, Beckman decided to manufacture the ink himself.  National Postage Meter set up a subsidiary company, National Inking Appliance Company, and put Beckman in charge.  This new company manufactured Beckman’s ink and also a pair of re-inking devices, also of Beckman’s invention.  The company was run out of a back of a garage belonging to a Caltech associate, and it employed graduate students part-time.  The ink was a success, but the re-inking devices were not; Beckman quickly discovered that secretaries were not willing to get their hands dirty to save their bosses the cost of a seventy-five cent ribbon.  Beckman learned an important lesson: no matter how ingenious an invention, it was worthless if it was not commercially viable.  National Inking Appliance Company was the smallest of operations, but it was a significant step.  Arnold Beckman was in charge of his own company.  It was another step beyond the cloister of Caltech.

The next big change in Beckman’s life came when he was asked by an old friend from the University of Illinois, Glen Joseph, to help solve a tricky experimental problem.  Joseph worked for the California Fruit Growers Exchange, a proto-agribusiness that controlled more than three-quarters of California citrus production.  They sold their prime quality fruit under the Sunkist label, but the lower-quality fruit was processed to make pectin and citric acid.  These industrial processes needed a sturdy and reliable method of testing the fruit’s acidity, but the sulfur dioxide that was added as a preservative made all traditional methods of testing untenable.  Beckman hit on a novel solution built around a pair of vacuum-tube signal amplifiers that made the device both sensitive and rugged.  Suddenly, his various experiences came together to put him in a unique position: his understanding of electronics, gained at Bell Labs, mixed with his knowledge of chemistry, his skill as an experimenter, and his enthusiasm for practical problem-solving to create a perfect solution to his old friend’s problem.

Once Joseph’s lab had demanded another device almost immediately, Beckman realized that there might be a wider market for his acidity-measuring devices.  Beckman’s real innovation was more fundamental, however.  Electrical equipment was commonly used in chemistry labs by the 1930s, but integrated instruments were not yet available on the market.  Experimental chemists were expected to have a working knowledge of electrical engineering in order to integrate the separate components of their experimental device.  Beckman’s original solution to Joseph’s problem fit within this paradigm; he supplied the vacuum-tube amplifier that Joseph integrated with his own meters and electrodes.  When Beckman began to think about the market beyond the California Fruit Growers Exchange, however, he envisioned an integrated instrument that would encase all the electronics in a neat box.  A sample would be placed in one end, and a reading would appear on the top.  It was simple, portable, precise, and did not require a deep understanding of electronics to operate.  Thus, Beckman’s solution was doubly revolutionary: it was built around vacuum-tube technology, and it was a completely integrated instrument rather than just a device. 

In October 1934 Beckman, Henry Fracker, and Robert Barton, who constituted the complete staff of the National Inking Appliance Company, submitted a design for an “acidimeter” to the Patent Office.  Beckman had decided to develop his instrument through his private business venture rather than through Caltech due to his respect for the ethical issues involved in using the resources of an institution of pure science for personal gain.  In April of 1935 the National Inking Appliance Company became National Technical Laboratories [NTL] to reflect its diversified business interests.  NTL was not a subsidiary of National Postage Meter.  It was an independent company, and Beckman owned ten percent of the stock.  National Postage Meter and Jergins Oil Company, its parent, split the remaining stock in return for nine thousand dollars starting capital.  Beckman was happy to give his private venture a new focus on instruments, because National Postage Meter was having problems that were not simply related to the Depression and the ink business was on uncertain ground.  It shows what a novice businessman Beckman was at the time, however; as he said later, “You see how stupid I was….We made back that nine thousand dollars in the first year.  They put peanuts into the thing and [eventually] made several million dollars….I was so naïve.”

In September of 1935, Arnold and Mabel traveled to the national ACS meeting in San Francisco with his newly perfected instrument in hand.  The conventioneers were fascinated by its simplicity, elegance, accuracy, and innovation, but they were unsure of its commercial success at $195 apiece.  This was not an insignificant sum of money, about the monthly salary of a starting chemistry professor, and the country was still in the Depression.  The Beckmans left with the semi-encouraging advice and departed immediately on an ambitious national sales tour.  They visited all the major national laboratory supply companies, on whose opinion the success of the instrument rested.  He received a positive response from Ed Patterson, Jr. of the Arthur H. Thomas Company, an influential national house based in Philadelphia.  He forecasted a 600-unit market, big enough for Beckman to move into production, but more importantly the presence of an NTL product in a major national catalog gave Beckman a legitimate entry into the instrument market.

Beckman returned to Pasadena encouraged and began the academic year at Caltech as usual.  NTL moved from the back of the old garage that had housed National Inking Appliance Company to a new building on Colorado Street, then Pasadena’s main street.  Demand grew quickly, and NTL sold eighty-seven instruments in the last three months of 1935.  The company had no starting capital to speak of, and payment for each batch of instruments was used to buy the parts for the next.  Production finally became well enough organized so that the instruments were produced in batches of twelve.  NTL turned the handsome profit of $2,000 that fiscal quarter, a remarkable start for any company, and especially impressive considering the economic conditions of the time.  Soon the instrument was carried in the catalogs of all twenty-eight major instrument dealers in the United States, and it was sold as the “Beckman Glass Electrode pH Meter.”  Even from the beginning, Beckman’s name was associated with high-quality precision instruments.

The success of late 1935 was not simply a fluke.  Despite problems of supply that reflected the early stage of development of vacuum tube technology, Beckman’s business grew to the point that he was forced to employ a “one-man sales force” to coordinate the flow of orders.  Since the company was operating without any start-up capital to speak of, they were forced to use “imaginative economy” in as many ways as they could.  Despite the company’s emphasis on economical solutions, quality and aesthetics were never sacrificed; the early instruments even had walnut cases.  Part of Beckman’s genius was to balance the contradictory demands of economy and quality, a skill that he attributes to the company’s Depression-era roots.

1937 brought the fledgling firm’s first major obstacle.  A professor at Stanford published a paper suggesting that the readings produced by Beckman’s pH meter were influenced by the depth of the electrode in the sample.  The NTL staff sought the cause of the problem, and found it in minute leaks in the glass electrodes.  The glass electrodes were a key component in that they allowed the instrument to measure the pH of a wider variety of samples, but they were flawed.  With typical confidence and energy, Beckman and his growing staff eventually secured a patent for their newly-invented factory-sealed electrodes that solved the problem.  This gave NTL another advantage in the marketplace: not only were they marketing the most precise instruments available, they were also the sole manufacturers of the most error-free electrodes.  They quickly specialized, producing electrodes made out of different compositions of glass that were optimized for different sample types.  The company flourished, with 1937 bringing in record profits from the sale of instruments and accessories.

Beckman oversaw this period of expansion and innovation in his private enterprise while still remaining a full-time faculty member at Caltech.  This is the same period in which he and Mabel were starting their family, and Beckman did not neglect his other research-and-development (R&D) projects, such as his inks for National Postal Appliance Company.  He managed this full plate by hiring project leaders for each of his various pursuits and by managing them in the same way that a faculty member organizes graduate students.  He presented each one with a problem and suggested possible solutions, and then let him come up with his own resolution.  If it was different from Beckman’s original idea, all the better.  He and his growing organization were solution-oriented above all else.

Caltech and a Family | National Technical Laboratories Comes Into Its Own
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