Lyle Beasley is back, running a company called IXT Solutions. The “IXT” doesn’t stand for anything, except maybe if you want to stretch it, “dotting the ‘i’s’ and crossing the ‘t’s’” because the business requires a lot of attention to detail.
It’s a mail production company, an outsourcing of the mailroom, where a company pays to have its bills printed, stuffed into envelopes, sorted by zip code, and sent to the US postal service. In volume, IXT Solutions will do the whole thing for about 45 cents a letter, including the paper, two envelopes and a stamp.
Craig Hodges, who ran the organization before Beasley bought it, remains president of the company. Beasley credits him as the brains behind the operational efficiency of their plant. He is also an equity investor in IXT.
“It’s a dull business,” says Beasley, though his words are very much at odds with his manner. He’s excited, his manner is headlong, he’s talking a mile a minute, his hands waving wildly as he explains the exquisite simplicity behind the superficial noise and confusion. “This is Business 101.”
And if that’s not enough, he continues, “I like business. This is like a petri dish for small business.”
Beasley’s odyssey to this non-descript warehouse, snugged up against the banks of I-65, wasn’t a straight one. He was an institutional sales person at J.C. Bradford, contacting large institutions with stock recommendations, in exchange for some order flow. When J.C. Bradford was absorbed into Paine Webber, he changed direction and co-founded a dot-com, Biopage.
Biopage had an interesting idea and at one point appeared to be on the verge of making it big. Instead of large organizations keeping tabs on you, determining your shopping habits, and then selling the information to interested consumer companies, Beasley and partner Tom Stumb proposed that you should control your own profile. It would be more accurate. Plus, you could profit when the list was sold to a prospect, rather than the money going to a company you don’t know anything about.
After all, it’s your information. It should be your money.
They were about to sign a critical agreement with Young & Rubicom’s KnowledgeBase Marketing unit, but Y&R was bought out by London-based WPP Group. All of a sudden, their deal was put on hold. It was never killed; it was just that Beasley and Stumb couldn’t find out where they stood as Y&R stopped doing new deals while it tried to rationalize the old ones.
The wait killed them. They decided that they couldn’t go on, given that the company was going to need a lot of capital before it was self-sufficient.
At that point, Beasley was left without a job. He decided that he liked being an entrepreneur. Biopage didn’t sour him on that. But he had to dial down the risk meter a little, looking for a business where the revenues weren’t so far out in the future. In fact, he would look for something more like a turnaround, a business that had some revenues but needed something to get it going.
Enter IXT Solutions. It had recurring revenues; it was steady, maybe even contra-cyclical; it was mundane; it needed to be turned around. The business had been started as a subsidiary of a printing enterprise, but took off and grew too fast. It was burdened with debt, and the owner needed to sell something to raise cash.
Outsourcing seemed like a reliable, long-term trend to Beasley, and the business fit his other criteria, so he bought it from the unit’s parent, National Business Products.
As Beasley explains it, a client hooks up to IXT with a high-speed T-1 telephone line. As the data streams into IXT, it is sent to the computers, which check each address against a file kept by the US Postal Service. This “cleanses” the list, updating those for which forwarding addresses have been found, and kicking out any undeliverables. By getting letters to people more quickly, it speeds up the payment process, which boosts hospitals’ bottom lines.
Then the information is put into informational fields for a company’s customized form (“We have an artist on staff and the ability to do color and much more freedom than most in-house systems,” says Beasley). It is printed, folded, inserted, stamped, and sorted. IXT promises a 24-hour turnaround on any statement.
“We are doing just under a million statements a month,” says Beasley. “By adding a few machines and some people, we can do 5 million. We spent the first 6 months on production, fixing the plant, building a scalable operation, and putting quality into our operation.”
“This is a turn-around situation. We had to clear away the brush. We used to have 20 problems a day; now we are down to one. We’ve been concentrating on keeping our customers. The former owners had sold 5 million statements a month, but they were down to producing just 1 million. They lost [accounts for] the other 4 million. We wanted to be sure we could keep any business we brought in. Now that we have our basics taken care of, we can go out and sell.”
The renewed sales effort is starting to pay off. Last week, IXT signed an agreement with Tulane University Physicians Practice that should increase the company's annual revenue by five percent. IXT now serves roughly 150 hospitals in 44 states.
Because IXT deals with mail in a high-tech way, its mail production may also be a bridge to the future as more and more bill paying takes place over the internet. This is called bill presentment, in which you, the customer, see your bills on your computer and authorize payments from your bank account to the creditor, bypassing the mail altogether. That’s a possibility for the future. Beasley is, at the moment, much more concerned with the present.
Did his dot-com experience teach him anything? Beasley stops for an unusual moment of hesitation, then says: “I learned from the Biopage experience that I needed to do a basic business and do it right. In a way, it humbled me. But it freed up my entrepreneurial spirit. I didn’t want to stop that. I know that all experience compounds. I’ve learned to hustle, to get good people, to never quit.
His board of directors includes Bobby Rolfe and John Eakin.
”We know what our revenues are,” Beasley says. “We are profitable now. We are at 20% capacity. It’s a businessman’s bet. The odds are good that we can someday be one of Nashville’s substantial employers.”
Beasley has a plan. He also has a boatload of energy and enthusiasm. His entrepreneurial spirit isn’t dimmed.
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