Nashville Post’s Fast50 is our annual look at Middle Tennessee companies on a roll. Together, these companies represent some of the best the Nashville area has to offer in terms of entrepreneurial vision and growth.
From start-ups gaining their financial legs to more established companies whose mature growth is remarkable, this collection of companies — big and small, highly profitable and increasingly profitable, full of dreams or realizing them — is perhaps best described as a list of “companies to watch.”
Selection is based on numerous factors, ranging from revenue and employee growth to growth over a period of years, growth as compared to industry average, projected growth and projected pitfalls, among other criteria. But the Fast50 also involves editorial judgment. Many of the companies reflected here applied to be considered for the list, but many were also chosen by our editorial staff based on an awareness of a company’s success or potential.
In sum, the first annual Nashville Post Fast50 spotlights companies that are enriching our local and regional economy, providing jobs and fueling the Mid-State’s entrepreneurial culture. These businesses — as well as the second batch of 25 — speak volumes about the value of free enterprise — especially amid today’s challenging economic times. They aren’t a bad read, either.
President & COO
Launched in 1990, ADS has steadily built its business in large part by acquiring regional peers. In the summer of 2009, it secured a line of credit to help it continue that strategy. Most recently, ADS acquired Systems Unlimited Inc., a Jackson security services provider that became its fourth market in Tennessee. (Jackson is now the westernmost outpost for ADS, which looked at the area as a bridge between its Nashville and Paducah, Ky., operations.)
One of the country’s largest security companies — the firm ranks 23rd nationally out of 14,000 companies — ADS now boasts 15 offices spread across five states. It is certainly conceivable that a national player will soon take an interest in ADS as an acquisition target. Cerasuolo joined ADS in 2008 from AFL Network Services, where he was vice president responsible for a 1,300-employee operation and 35 locations providing telecommunications equipment installation services to major telecom carriers. He is also chairman of the Tennessee Center for Policy Research, a nonprofit organization that promotes free markets, limited government and individual liberty in Tennessee.
Demand by TV stations and networks to provide high definition program content to their viewers, as well as U.S. government mandates that all major TV stations go digital has increased demand for broadcast communications equipment maker Adtec’s products. Adtec equipment is also used as point-of-sale displays for marketing, entertainment and informational purposes. In business for 25 years, the company boasts a client list that includes NBC, ABC, CBS, ESPN, the White House, NASA and the U.S. military. Other types of clients range from cruise lines to casinos, theme parks, museums, restaurant chains, hospitals, universities, retail merchants and even K-12 schools. These customers may use Adtec’s products to insert commercials on TV and stream video from point to point. Or, in the case of the New York City school system, to network schools and local museums for distance learning purposes. Launched with $10,000 of stock sold to four shareholders, the firm now has 63 employees. Growth has been around 17 percent higher than competitors in the professional broadcast space for the past couple of years.
Aegis Sciences Corp.
David L. Black
President & CEO
In an age where performance-enhancing drugs go hand in hand with professional athletes and widespread media coverage, it seems unlikely that Aegis’ booming testing business will suffer anytime soon. The 330-employee company, which can test for 3,000 performance-enhancing drugs, designs and administers testing programs for professional, collegiate and high school athletic programs across the country and is the largest independent sports doping laboratory in the United States.
Big-name clients include NASCAR, the Major League Baseball Players Association, World Wrestling Entertainment and the Indy Racing League, among others. Though athlete testing may be the 20-year-old firm’s highest profile service, representing a significant growth area for the company, it is joined by Aegis’ single largest segment — the pain management division, which allows doctors to monitor patients who are prescribed drugs for chronic pain.
The company also has a workplace drug testing segment with local clients that include Nissan, Bridgestone-Firestone, Metro Nashville Government and the State of Tennessee Department of Probation and Parole. Another division works with medical examiners nationwide. Even a down economy can’t impede Aegis’ recession-resistant business. After all, while people are prone to celebrating in good times, they also look for something to ease the pain when times are bad.
American Music Channel
Each month, Internet users stream tens of billions of videos, a trend that shows no signs of slowing. American Music Channel offers roughly 15,000 mainstream music videos on demand via record label agreements forged by Willis, the former CEO of Country Music Television and a co-founder of the first company ever to take video over DSL (mPhase Technologies).
Also a general entertainment destination and community for music fans, American Music Channel appears to be the first Web “channel” to put video and fan content side by side with a social network connecting music fans and independent artists. The cumulative effect seamlessly mingles indie and mainstream content — allowing all artists an equal shot at worldwide exposure and all music fans a unique opportunity to find new music.
The company has been described as the record label of the future. Willis’ high-profile investors and advisors speak to the value of his Internet property. They include Lipman Brothers CEO Robert Lipman, as well as Jeffrey Hopmayer, creator of one of the first suppliers of pastries to Starbucks and subsequent founder of Extreme Beverage Co. (later Blavod Extreme Spirits).
Barrett, a globally recognized voice for gun rights, designed and built his first rifle at age 26. Over 25 years later, his products, including the world’s first 50-caliber rifle that one can fire from the shoulder, are used by law enforcement agencies and over 50 foreign militaries around the world. Company growth is being fueled by ongoing government/police contracts and the rising population of sport shooting enthusiasts.
Growth culminated last year in a 48,000-square-foot, $4.1 million expansion of Barrett’s Rutherford County manufacturing space and the addition of 50 employees. Barrett spent much of the past year embroiled in a legal fight with county and state officials over TDOT’s decision not to widen a road leading to his facility.
Barrett was recently awarded the 2010 Golden Bullseye Pioneer Award from NRA Publications. The award spotlights exemplary achievement by individuals who were responsible for the development, introduction, and promotion of equipment that has made a profound and enduring impact on the way Americans shoot and hunt.
Big Machine Records
Borchetta’s highly successful independent record labels are flourishing at a time when most in the industry are shrinking. While the old record labels are still functioning largely like battleships that are unable to turn on a dime, Borchetta’s label looks more like a fighter jet.
A longtime establishment music executive, Borchetta launched indie label Big Machine on the promise of an unknown teenage artist — Taylor Swift — signing her to her first major label deal. Borchetta later signed country superstar Reba McEntire, who had spent the previous 34 years with MCA/Mercury.
When Disney announced this past April that it was shutting down its Lyric Street label, the House of Mouse said it would transition superstars Rascal Flatts to another section of its music empire. The band declined and instead teamed up with Big Machine Records, specifically stating the desire to work with Borchetta, who was earlier this year named Nashville Post CEO of the Year.
Capital Confirmation Inc.
Chris Schellhorn & Brian Fox
After working at two of the “Big Four” accounting firms, CPA Brian Fox saw that mailed audit confirmations were inefficient and open to fraud as the inefficiencies of the system made it easy for companies to conceal fraud simply by circumventing the auditor’s paper-based confirmation process.
With two patents in hand, and in partnership with Chris Schellhorn as CEO, CCI was launched. A provider of secure electronic audit confirmation services that improve the end-to-end turnaround time for fulfillment of audit confirmation requests, CCI now boasts more than 7,000 accounting firms in 94 countries as clients, as well as all of the Top 10 banks in the United States and the Federal Reserve Bank, not to mention more than 200,000 of their mutual clients.
CCI’s confirm technology helps streamline the confirmation process, increase client privacy, avoid fraud and eliminate paper storage. CCI reduces the average confirmation turnaround time 96 percent from four weeks to one business day, reduces error rates by almost 75 percent and saves accounting firms significant staff time. At last count, CCI had processed more than $3 trillion in confirmation balances.
The initial capital of $200,000 for the company came from Fox’s mother and brother, supplied to Fox while he was in business school at Vanderbilt University. Follow-on financing came from additional family, friends, employees and local angel investors. The first four employees of CCI went without salary for almost the first two years while working out of a garage apartment. The now 23-employee company is growing at a rate much higher than the industry average.
It was listed as No. 96 on the 2010 Inc. 500 list and is the fifth fastest-growing financial services company in the United States. Recent events should have an even more positive impact on CCI revenue, as the company recently received the exclusive endorsement of the AICPA (American Institute of CPAs) and the ABA (American Bankers Association).
Honing in on an untapped advertising niche 15 years ago, Malham founded what’s now the largest full-service ad and marketing agency geared toward personal injury lawyers across the country. But the serial entrepreneur hasn’t stopped there — he created additional companies dedicated to serving the oft-derided profession. There’s Legal Intake Professionals, launched in 2000, which is a 24/7, 365 days-a-year specialized call center made up of 60 specialists dedicated to providing new case intake for injury lawyers in more than 100 firms across the nation.
Other business units under the Malham Leverage Group umbrella include Stuff4Lawyers and the EXPNetwork, which provide clients tools for competitive advantage in their markets. Med View Services employs registered nurses and legal nurse consultants to assist injury lawyers in more effectively and efficiently screening their medical malpractice cases.
cj Advertising’s goal is to build and represent the top 50 personal injury brands in the United States, and with over 30 firms in over 70 markets already in the fold, the company is well on its way.
Consensus Point works with corporations and government groups to build prediction markets — software tools that let organizations capture the collective intelligence of their employees, stakeholders or the public so they can anticipate future events and make more informed business decisions.
Consensus Point companies — clients include General Electric, Healthways, Overstock.com, Motorola, Best Buy and Qualcomm — can post a question to the online market, such as whether a particular project will be completed on time. Participants then can answer the question, betting a certain number of points on an outcome depending on their confidence level. Correct answers return more points, lead to higher standings on the market’s leader board and possibly other rewards or incentives for the participants while helping executives more effectively manage the business.
Company investors include Nashville-based CEOs and venture capitalists, including Crom Carmichael, Lee Beaman, Robert Lipman, Linda Rebrovick, Frank Grant and Mike Shmerling. Consensus Point is also building strategic business partnerships with software companies, consulting companies and social media companies to leverage its decision markets. Current industry partners include Brightidea and Ingenix.
CRE Technologies (d.b.a. RelevantAssets)
Chairman & CEO
David Mills incorporated real estate software firm CRE in 2000. A $1.1 million private placement funded the company’s initial research, development and prototype testing efforts that have resulted in a suite of software products that help Fortune 500 companies with the asset and cost management of their corporate real estate portfolios.
Having worked with more than 100 enterprises encompassing 13,000 properties and over 70 million square feet, the company is now gearing up to begin accelerated sales and marketing efforts. Earlier this year, the company greatly expanded its management and development team and announced plans to raise $400,000 in private capital to help grow the business.
RelevantAssets software and services provides an enterprise financial performance application, InFocus, for improving governance and risk management of corporate real estate portfolios. InFocus is a Web-based SaaS (software-as-a-service) application sold by subscription.
Supporting services include enterprise performance management and spend management engagements. Customers include large and mid-cap health care, banking & finance, retail, hospitality, manufacturing & distribution, communication & entertainment, government and education enterprises where real estate is not the core-business.
CEO & President
Cybera provides data security and payment card industry compliance solutions to merchants in the retail and restaurant industries. Cybera’s services, which provide protection against costly security breaches and identity theft, are used by customers ranging from small businesses to large multi-national corporations with locations numbering in the tens of thousands.
Large clients include Chick-fil-A, Lenny’s and Shell Oil. Cybera founder Duffey, who started the company with personal funds, contributions from friends and family and angel investors, later obtained venture capital to expand the business, which now employs 78 people. During the current economic downturn, many of Cybera’s competitors have experienced significant size reductions, have been acquired or have gone out of business.
Anticipating evolving customer needs, Cybera changed its product set to meet the growing needs of merchants at a lower price point. As a result, Cybera will see a drop in revenue but an increase in profits as current customers migrate to the new security product set. Growth is also attributed to the expansion of security services that enable merchants to meet PCI compliance requirements and protect data without purchasing costly equipment or hiring external consultants.
Cybera also continues to add new security products to address the growing demand to secure and protect cardholder data and report compliance filings to the financial institutions that process credit card payments.
David Ingram’s beer distributorship business, a sister company to Ingram Entertainment, the mammoth DVD and video game distributor he spun off from his family’s holdings in 1997, is gobbling up other distributorships in California at a rapid rate.
The over 900-employee company’s growth has come through acquisition. (Its year over year organic growth is along industry standards.) For instance, DBI recently announced its eighth acquisition in Northern California: Maita Distributors, of San Mateo County. Until earlier this year, Maita was suing DBI over the right to distribute Miller and Coors brands in its market area.
The Maita purchase, terms of which were not disclosed, brought DBI’s total distributions in the Northern California market to some 25.2 million cases of beverage products a year. The company now owns distributorships in Chico, Napa, Sacramento, San Francisco, San Joaquin, San Jose, Truckee and Ukiah. Ingram entered the small fraternity of beer distributors nationally via his 2002 purchase of Crown Distributing in Memphis (which Ingram sold off around the same time as the Maita deal).
But with the total number of distributorships nationally likely to shrink considerably in his lifetime, Ingram’s glass is looking more than half full.
Coupons have gone high tech. The Yankee Group recently released a study finding that the number of mobile coupon users in North America is set to increase more than tenfold in 2010, followed by triple-digit increases in both 2011 and 2012. In all, according to the report, some $2.37 billion worth of mobile coupon transactions will take place in North America in 2013, up from just $5 million in 2010.
Clearly the personalized digital coupon is a burgeoning new concept in retail marketing. Mobile advertising company edo Interactive is at the forefront of that charge. edo’s lead product The Facecard, is essentially a pre-paid MasterCard, but users get digital incentives called “prewards” — essentially digital coupons that clients like Coca-Cola, Baskin Robbins and H&R Block load on as consumers swipe their cards.
Targeting younger generations, the Facecard offers an alternative to traditional advertising methods, one that many find more direct and targeted to their audience. The company recently announced another capital raise of $3 million following the digital marketing company’s biggest deal to date.
Co-founder & CEO
This stylish e-mail marketing and communications service for small businesses took flight in 2003 when its founders asked the Belcourt Theatre to try its prototype for free in exchange for feedback. The now 100-employee Emma has expanded its reach to include a growing roster of mid-size organizations, agencies and channel partners.
The firm currently serves roughly 30,000 accounts across the United States and other English-speaking countries, adding roughly 700 new accounts a month. Businesses and organizations like Gibson Guitar, Life is Good and New York University, among others, use Emma to design e-mail marketing campaigns and online surveys. Today, Emma has satellite offices in Denver and Portland.
CEO and President
A private equity group comprised of Alarian Associates, C3 Capital and industry executive Davian Ploger completed their purchase of environmental cleaning company First Response Inc. earlier this year. Their stated aim is to grow it into a $50 million regional player. The company went into overdrive to help clean up some of the oil-covered beaches in Northwest Florida in the aftermath of the Gulf oil spill.
As a result of both the Gulf of Mexico disaster and the more recent spill in Michigan's Talmadge Creek and Kalamazoo River, First Response's 2010 revenues will come close to doubling from the previous year. First Response got its start in Bowling Green in 1994 but moved to Middle Tennessee in 1998. The company now has five offices (and growing) and about 125 employees in Tennessee and Kentucky and pulls in close to $10 million a year cleaning up oil and chemical spills, storage tanks and old buildings, specifically health care facilities containing asbestos. The company also intends to look at coal-powered plants.
Franklin Synergy Bank
Opened in November 2007 in Cool Springs, the bank currently has two branches, one in Cool Springs and one in downtown Franklin. A third branch for Brentwood is in the works. The bank also operates a mortgage office in Brentwood. Franklin Synergy’s management team worked together at Franklin National Bank and Cumberland Bank, prior to their sales to Fifth Third Bank and GreenBank, respectively.
The bank is primarily a real estate lender. Founded with $26 million in initial capital from 173 investors — 95 percent local — the bank now employs 70 people. Banks measure themselves against their peer groups, which in Synergy’s case would be banks opened in the year. Franklin Synergy’s revenue growth is in the top 25 percent of that peer group even though it opened late in 2007.
Few banks are doing much local real estate lending, leaving the field wide open for Franklin Synergy. It is traditionally a very good business in Williamson County, which has not experienced as severe an economic downturn as other areas of Tennessee.
Former electrical engineer Griffin started his company more than 15 years ago making adapters to allow the use of PC peripherals with Apple Macintosh computers. Today, his company is one of the largest makers of peripheral products for all things Mac, including iPod. A global player in the development of world-class electronics and accessories for PCs, gaming, audio, video and the iPod, Griffin’s name is synonymous with ingenious technological design in his industry. (See our related story.)
CEO & Co-founder
Just seven years old, HometownQuotes is already the largest privately owned entity in its industry. The company, whose largest competitors are publicly traded companies that have been operating for more than 15 years, helps consumers comparison shop for insurance by connecting individuals with local, hometown insurance agents offering quotes for auto, home, life, health and renter’s insurance.
As such, Hometown Quotes also helps insurance professionals expand their insurance businesses and make a difference in their local communities. Ingram and co-founder Bob Klee self-funded HometownQuotes, starting the company out of a room in Klee’s house. They have never borrowed money, and the company remains debt-free.
Consolidation in the industry, a new partnership with a national insurance carrier that will allow for more diverse quoting opportunities and the acquisition of the intellectual rights and phone licensing for the 1-800insurance.com URL has HTQ primed for bigger things.
Informatics Corporation of America
ICA makes hospital records more easily accessible. Established in 2005 to take its innovative technology developed at Vanderbilt University Medical Center to the broader health care market, ICA assembles data from different computer systems, creates a unified electronic health record including disease and wellness dashboards, provides secure messaging and real-time clinical information, and in the end aids decision-making and improves patient outcomes in the health care setting.
The 52-employee company currently boasts contracts with major health care providers, including locally owned Vanguard Health Systems. The availability of stimulus funds for health care companies to pursue electronic medical records opportunities has been a positive development for ICA, which expects to increase its staff above 80 before year’s end.
CEO Zegiestowsky, who co-founded ICA with Vanderbilt University Medical Center, previously served as COO of a $500 million division of Cendant Corp.
Jarrard Phillips Cate & Hancock
Jarrard Inc. is well positioned here in the “Silicon Valley of Health Care” — home to more than 300 health care companies accounting for approximately $50 billion in revenue. The work of the nationwide health care public affairs firm focuses on serving the hospital industry — from hospital mergers and acquisitions to grassroots reputation management, auditing, fixing or helping build an organization’s relationship with its staff or its community, certificate of need challenges and crisis communications.
Jarrard posted double-digit growth in 2009, ranking it among the top 20 fastest-growing independent public relations firms nationwide, according to information compiled for O’Dwyer’s annual PR Firm Rankings. With $2.26 million in 2009 net revenue, the firm posted 15 percent year-over-year growth during a period in which the average growth nationally for PR firms reporting to O’Dwyers was -1.6 percent. The firm ranked as 18th among all specialized healthcare PR firms (a jump from 27th the previous year) and 83rd among all PR firms (up from 116th). Based on these numbers, Jarrard is the fastest-growing PR firm in the state.
The passage of federal health care reform and its impact on the U.S. hospital industry (changes in hospital and physician reimbursement, a remaking of the insurance industry and a heightened focused on quality) will drive fundamental change at hospitals in every market — and, by extension, demand for Jarrard’s experience and services.
The boutique agency founded in January 2006 by David Jarrard, Kevin Phillips, former Nashville Post writer Molly Cate and Anne Hancock — all former Ingram Group staffers while Jarrard was president there, now employs 13, is expanding staff and building partnerships in various markets.
Sherry Stewart Deutschmann
Founded in the basement of Deutschmann’s home in 2002, LetterLogic has grown to annual revenues of $20 million and fills a 27,000-square-foot building in downtown Nashville. The company’s sole business is the delivery of statements, invoices and letters via electronic presentment or the traditional print-and-mail system.
The company was recently re-listed as one of the top 50 fastest-growing women-owned/led companies in America by the Women President’s Organization, a national nonprofit with 84 chapters. Deutschmann has been named by Ernst & Young as one of 10 “Winning Women Entrepreneurs” and was a finalist this year in E&Y’s coveted “Entrepreneur of the Year” award.
One key to LetterLogic’s success? An employee-centric benefits package that includes monthly distribution of 10 percent of profits split evenly among all employees (regardless of title), 100 percent company-paid coverage of medical, dental, disability and life insurance for employees and even pay-by-the-mile for workers who walk or bike to work.
LifeGuard Medical Solutions
Chet Frist & Harvard Reynolds
LifeGuard was formed in response to the sudden cardiac arrest death of Reynolds’ father at his home in Nashville. Today, the company is a leading national distributor of automated external defibrillators (AEDs) and onsite CPR training.
As more and more state and federal agencies look to make the availability of defibrillators mandatory in certain areas such as school systems, corporate facilities and municipal buildings, growth is expected to continue.
The company made news in Tennessee in 2007 when an 85-year-old man collapsed near the front desk of the Fall Creek Falls Inn at the state park in Bledsoe County. State Sen. Bo Watson (R-Hixson), a physical therapist at Parkridge Medical Center, was on site and with others saved the man’s life using an automated external defibrillator provided by LifeGuard.
CPR/AED training is another LifeGuard offering. Corporate clients for this service have included the Department of Homeland Security, NASA and Macy’s/Bloomingdale’s.
LightWave Solar Electric
Founder & President
Recently named to Nashville Post magazine’s first ever list of the 50 greenest companies in the Music City area, LightWave has grown from 10 to 16 employees in the past year. The company designs and installs turn-key solar electric systems throughout Tennessee.
In business since July 2006, LightWave boasts an unlimited state electrical license and the most North American Board of Certified Energy Practitioners (NABCEP) certifications in the state (four). The company has now installed over 100 solar PV systems — that’s 750 kW of installed PV power. Johnson has worked closely with TVA on the development of the Generation Partners program and has been responsible for the design and installation of over half of TVA’s grid-tied installations in Tennessee, including installations at Oak Ridge National Laboratory.
Other projects/clients have included the City Square shopping center, the Metropolitan Development and Housing Agency’s (MDHA) Parthenon and Madison Towers, as well as residential projects for former VP Al Gore and singer Sheryl Crow. As solar heats up in Tennessee — along with government incentives to complete solar projects — LightWave stands to benefit.
According to a recent IEG Sponsorship Report, which tracks sponsorship spending, North American companies will spend in excess of $1 billion again this year to sponsor music venues, festivals and tours. Allen’s sponsorship and fulfillment agency negotiates such high-profile sponsorships between the world’s leading artists and the world’s leading business brands.
As Billboard magazine wrote about Allen a few years ago, “Live entertainment sponsorships have moved beyond the days of onstage signage and a simple ‘presents’ designation on a concert ticket. In brokering fully integrated, multiplatform band/brand partnerships, Allen has been at the forefront of this shift.”
Examples of partnerships Allen has brokered through the years would be the relationship between Lenny Kravitz and Nikon, or booking the Foo Fighters and Queens of the Stone Age for BlackBerry’s Storm launch party. Clearly a specialist in contract negotiation fulfillment and activation involving partnerships between companies, music artists and event properties, Allen is proof that there are still creative ways to create and sustain a lucrative business around the music industry.
President & CEO
Magazines.com is the oldest and the largest magazine subscription service on the Internet, offering access to over 2,300 consumer and business magazines and boasting one million active customers. The company started in 1999 when Clarke acquired the www.magazines.com URL.
With the help of investors Time Inc. (publisher of titles including Sports Illustrated and People), Meredith Corp. (publisher of titles including Ladies’ Home Journal and Better Homes & Gardens), and Anderson Media of Knoxville, the company took flight. Clarke rightly believed that an online store was the perfect place for people to buy magazines because it would greatly simplify the subscription process and allow one to manage subscriptions in one place.
At the same time, that same site could give customers access to hundreds and even thousands of magazine titles. Today, the 53-employee company is frequently ranked by Internet traffic monitoring companies among the most-trafficked sites in the shopping and books categories, making it a top U.S. Internet property. The launch of a completely new Magazines.com Web site in August 2009 that is faster, more functional and has an enhanced gift center, has led to strong increases in sales.
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