Dan Gilbert-backed football helmet maker is butting heads with big industry players

DETROIT — After offering ear plugs to bystanders, Kyle Lamson approached a computerized battering ram and pressed the red button on the controls. A countdown alarm sounded, and all eyes in the gear testing room focused on the big metal rod lined up opposite a crash dummy's head.

Fitted over the head was a football helmet from Xenith, the high-tech football equipment maker that moved to Detroit two years ago from Lowell, Mass., and is a growing part of billionaire businessman Dan Gilbert's family of companies.

A loud pop rang out as the metal slammed into the helmet at 5.82 meters per second. The dummy head flew backward on its carriage with violent force. It was the sort of blow that could sideline a player in an actual game and wreck the nerves of any parents in the bleachers.

"That would be a very high-level hit for sure," said Lamson, Xenith's director of new product innovation. "That's a 1-in-100 hit, versus an every down kind of hit."

Xenith is in the business of mitigating the impact of hard hits to the heads and bodies of the more than 3 million youths and adults who regularly play tackle football each year. The company employs about 100 people in Detroit during its summer production peak, and its helmets — designed with patented Shock Bonnet technology — are among the highest-ranked football helmets for safety.

Xenith is considered the No. 3 player in the football helmet business, behind Schutt Sports and market leader Riddell, with an estimated 10-20 percent of the total market. The company says it has grown since moving to Detroit, even during a continued decline in football participation across the U.S. amid heightened concerns about concussions.

The company's helmets are worn by youth league players, high school teams, college athletes, and about 60 NFL players. Its retail prices range from $290 to $350 per each high school and adult-sized helmet, and $285 to $200 for youth helmets, although teams can get discounts.

While Xenith also sells football shoulder pads and some apparel, helmets are its main seller.

"Xenith really came on the scene with an aggressive approach to innovation," said Tom Cove, president and CEO of the Sports & Fitness Industry Association. "It is hard to break into this market — it's a very challenging business — so it's exciting to see how they were able to enter and become a major player."

Xenith President Ryan Sullivan declined to specify annual revenues, but said the company will make more than 1,000 helmets each day this summer at its 66,000-square-foot production facility and warehouse in southwest Detroit.

"We've roughly doubled our business since we moved here to Detroit," Sullivan said. "We've seen everything from teams buying a few helmets all the way up to teams buying 100-plus helmets."

Xenith's models have top marks on Virginia Tech's influential STAR ratings system for football helmets that reduce concussion risk.

Three Xenith helmet models also ranked in the top six in the NFL and NFL Players Association's 2017 Helmet Laboratory Testing Performance Results. The highest-ranked Xenith model, the Epic+, was No. 4 on the list behind two Schutt models and the No. 1-ranked VICIS Zero1, a new high-end $1,500 football helmet created by a Seattle startup aimed at college and professional players that is to become available for younger players next year at a lower price.

"Xenith is a good competitor," VICIS CEO Dave Marver said. "They've done a really good job with the youth levels of the sport, and I think that when they came into the market they sparked more openness to new technology. So we have an easier path than they did."

Xenith was started in 2006 by Dr. Vin Ferrara, a former Harvard University quarterback. He developed Xenith's core innovations, including the inner Shock Bonnet, a "floating suspension system" of shock absorbers that moves independent of the helmet's shell to help mitigate the rotational forces of hard hits.

By contrast, a traditional football helmet has foam and pads attached directly to the shell. So when the shell rotates, so do the pads and the wearer's head.

"So upon impact the shell will rotate back, to the side, or whatever — independent of the bonnet itself," Sullivan said Xenith's helmets. "So it really helps to spread out those forces of impact."

The company introduced this technology in its first helmet model, the X1, in 2009 while still based in Massachusetts. The X2 followed in 2012, featuring improvements to the shock absorbers, padding and chin strap. The EPIC and X2E arrived in 2014 and the latest models, the EPIC+ and X2E+, came out this year.

Xenith once made baseball helmets and had considered moving into other sports but is currently focused on just football.

Yet even with its novel technology, Xenith has had players experience concussions while wearing one of its helmets, Sullivan said.

"No company can offer a concussion-proof helmet," he said. "What we do stand for is advanced research and development, advanced design that we believe is the best product we can put out in the marketplace."

In a possible sign of Xenith's growing size, market leader Riddell last year sued Xenith in federal court, alleging infringements on its football helmet patents in Xenith's EPIC and X2E helmets

Riddell, which is based in Rosemont, Ill., has filed patent-infringement lawsuits in the past against other competitors also, including Schutt and Rawlings.

Xenith has denied all of the patent-infringement allegations and claims in court documents that Riddell brought forth its lawsuit "with wrongful intent, or at least gross negligence."

Riddell spokeswoman said the company does not comment on pending litigation.

Patent lawsuits can sometimes be devastating in the football helmet business. Rawlings stopped making football helmets shortly after getting hit with a Riddell lawsuit in 2015. And Schutt was forced into Chapter 11 bankruptcy in 2010 after losing a $29 million judgment in a Riddell lawsuit concerning patents.

Schutt was then bought out of bankruptcy by Beverly Hills, Calif.-based Platinum Equity, the private equity firm of Detroit Pistons owner Tom Gores.

Asked whether Xenith, like Schutt, faces any danger of bankruptcy from Riddell's lawsuit, Sullivan replied that the Riddell suit "is not an existential crisis for us."

"I won't comment on the overall lawsuit," he said, "but it's not anything that our customers or other folks in the marketplace should be concerned about with respect to our financial viability."

Gilbert, founder of Detroit-based mortgage giant Quicken Loans and majority owner of the NBA's Cleveland Cavaliers, was cited by Forbes as one of several early investors in Xenith. He was instrumental in the company's 2015 relocation to Detroit. Xenith's founder, Ferrara, left the company about two years before the Detroit move.

Sullivan, who previously worked for Gilbert's Rock Ventures before becoming Xenith's president last year, said Gilbert is a "significant shareholder" in Xenith.

All Xenith helmets are assembled, tested, painted, reconditioned and warehoused at the Detroit plant.

Most of the helmet shells are manufactured by Sturgis Molded Products in Sturgis, Mich. Components for the insides of the helmets are made in China, Sullivan said, as are the shells for youth helmets.

Xenith is also in the football helmet reconditioning business. The company recommends reconditioning its helmets after each season, but at a minimum every other season. Reconditioning costs $50 per helmet or less with team discounts. Helmets typically last about 10 seasons with regular reconditioning.

Xenith supplied at least a dozen helmets last year to every high school football team in Detroit. Two of those teams — Cass Tech and Martin Luther King Jr. High School — won state championships.

Cass Tech head coach Thomas Wilcher said all but a handful of players on his varsity squad chose to go with Xenith helmets last season. They liked how the helmets are lightweight, easy to maneuver around in and easy for them to breathe through while they're on, he said, adding that he likes how Xenith's models are priced below other five-star helmets in the Virginia Tech ratings.

The five or so players who chose different helmets last season tended to have "a lot of hair," making it harder to get a Xenith helmet on, Wilcher said.

"I love the fact that this is a company that's based in Detroit because you have a chance to go over there, see the product, see how it's getting built," he said.

Clarkston High School football coach Kurt Richardson said he has a mix of Xenith, Riddell, and Schutt helmets for the 130 players on his varsity and junior varsity squads. Many players like the Xenith helmets, he said, although some have had issues with how they fit. Richardson considers the helmets' main drawback to be its special Xenith chinstrap; "You can't use a universal chinstrap," he said.

Xenith has a presence on many NCAA Division I football teams, according to the company, and about 60 NFL players wear its helmets, including Eagles defensive end Brandon Graham.

Riddell had been the official helmet brand of the NFL for 24 years until the end of the 2013 season. Players were permitted to wear any helmet brand, but Riddell was the only logo that could be displayed on helmets.

One challenge for Xenith — and the football helmet business in general — is the continued drop in the number of young people playing tackle football. Reports by the Sports & Fitness Industry Association show the number of serious participants in the sport — defined as those who play 26 or more times per year — tumbled 24 percent from 2007 to last year.

"There's certainly been a decline in participation at some levels, and I think a lot of it has to do with concern for safety," said Glenn Beckmann, director of marketing communications for Schutt Sports.

Nevertheless, Beckmann said that improvements in helmet and equipment technology, along with heightened awareness about head injuries, have made football a safer game to play today than any time before.

"We now have coaches and administrators and leagues in place where if you are showing signs of a head injury, you are coming off the field," he said.

1. Vicis Zero1
2. Schutt Air XP Pro VTD II
3. Schutt Air XP Pro VTD
4. Xenith Epic+
5. Xenith X2E+
6. Xenith Epic
7. Riddell Speed
8. Schutt DNA Pro+
9 Riddell Revolution Speed
10. Schutt Vengeance DCT

— Source: NFL/NFLPA 2017 Helmet Laboratory Performance Results