Making Tubes User-Friendly: Luke Manley of VTL
It's a familiar story with a predictable ending. About four or five years ago, VTL was following this script to a "T." But their ending has a twist. Not only have they survived, they've muscled their way into the small group of companies defining the state of the art. Their spectacular showings at hi-fi shows and new products like the outrageous 1250W Wotan monoblocks are attracting attention, but these are only the most visible evidences of more fundamental changes within the company itself. Since taking the reins in 1993, Luke Manley has charted a clear and different course for the company, and presided over a top-to-bottom re-engineering of VTL's products and operations. I recently had the opportunity to chat with Luke, and hear VTL's history and recent changes.
The origin of VTL can be traced to the early 1980s, when it was started by the father-and-son team of David and Luke Manley as a spinoff of David's recording-studio work in South Africa. The first VTL prototypes were developed when the two acquired a number of tube amplifiers and rebuilt them using David's circuit topologies. The company began in earnest in 1986, when David set up shop in England and began building products for the European market, and Luke moved to Rhode Island to set up US distribution. The products caused quite a stir at that summer's Consumer Electronics Show, and, a few months later, the first reviews—raves—hit the newsstands. The products were simple in design and execution, but offered a distinctively open, muscular sound, and were priced at about half the cost of similarly powered competitors' products. In response to this runaway success, VTL moved to North America—first to Montclair, Ontario, and then, about eight months later, to its current digs in Chino, California.
Demand for the products was insatiable, and VTL suffered the typical growing pains. There were a host of interrelated problems: The designs were never fully developed with respect to manufacturability. A lack of resource planning resulted in inconsistent parts availability and quality. The business structure was poorly organized due to a lack of understanding the market. And because VTL was an unknown quantity, it struggled with small dealers who couldn't adequately handle customer concerns, resulting in even more load placed on factory staff. In a nutshell, there were too few people trying to do way too much. At the heart of the matter, though, was the fact that the passion for music and beautiful designs responsible for the products' performance was also responsible for the inattention to the business and manufacturing sides of the equation.
The PR-9 Ultimate preamp illustrated the dichotomy. It was filled with tiny circuit boards shoehorned into an impossibly small space and connected with the shortest possible point-to-point wiring. What's more, the boards themselves were packed with vast numbers of components, all of different values and brands. Even the back panel, which would fold down if the wiring had enough slack to permit it, was jammed not only with I/O jacks, but a host of power-supply components as well. It was obviously a "no-holds-barred" design, but, just as obviously, one that was damn near impossible to build.
As Luke says, "We couldn't get proper build consistency. The products, particularly [the Ultimate], were very, very hard to build...too reliant on personal skill. It took us a long time to learn to build that one properly. Fortunately we developed the skills to do it, and that was our biggest-selling preamp...but I just don't think it's necessary. There's no reason a product has to be that hard to build. We even had to develop a special instrument to change the tubes. But at VTL my dad showed that his speciality was not manufacturing. His speciality was brilliant product conception and design. In fact, he gets bored with manufacturing, doing the same thing repetitively.
"We grew extremely quickly in 1989 and '90, when all the reviews came out, but we were killing ourselves. There was just no way to grow the company easily because we never computerized, we never planned inventory. The more we had to ship stuff, the worse the stress got. I started working weekends, and working 'til midnight, all kinds of crazy hours. You just make mistakes when you do that, and we had aggravated customers because we couldn't deliver bulletproof product. You can't think about your business in the long term when it's like that."
At the same time, a philosophical split was developing between the two Manleys. Luke felt that the only way to survive in an increasingly competitive market was to stabilize a product line, pay more attention to the manufacturing and business issues, and build a stronger dealer network. David, on the other hand, wanted to sell directly to the consumer, expand the product lines, and move toward increasingly esoteric products.
There was a fundamental difference in their perception of the market as well. Luke believed that nonaudiophile music lovers could also be attracted if the products were sufficiently simple and user-friendly. David disagreed, maintaining that the only real long-term market strategy for tube gear was to serve as many different markets as possible. By 1993, "We were totally tapped out. We weren't improving our dealer distribution in the hi-fi sector, we weren't improving our product enough to compete in hi-fi. We were putting out more and varied products and going into different industries, such as the studio market....I could never get agreement from Dad to focus on a set product line; he always had a justification....Our products were like rabbits.