Rochester Top 100 — No. 2!
Once Reseller, 5LINX® Now Is Telecom
It adds offices abroad, may acquire two broadband phone companies
It started with a woman in Maryland, who hadn’t seen her family in west Africa for years, sending a 5LINX® video phone to family there.
The Henrietta company, seeing a potentially huge market with the Nigerian expatriate community in the United States, earlier this fall opened an office there. That came after a new office earlier this year in Sweden and one expected by year’s end in South Korea.
And 5LINX® Enterprises Inc. — which started in 2001 as a telecommunications version of Amway or Mary Kay — continued morphing into a telecom company in its own right.
"We’re a carrier now, not a reseller anymore," said CEO Craig J. Jerabeck.
With that change has come sizable growth that has put the company on the Top 100 list for four consecutive years, each time higher in the ranking than the year before.
5LINX® had revenue of $46 million in 2008 and expects to hit close to $52 million this year, Jerabeck said. The company employs roughly 170, up from 110 in 2007, the year it moved into a 50,000-square-foot building close to Interstate 390.
Jerabeck said the company is eyeing a pair of possible acquisitions of other broadband phone companies. At the end of 2008, it bought part of Kancharla Corp., an Alabama telecom software company.
5LINX® started strictly as a multi-level marketer of other companies’ telecom products. Members of the independent sales force were paid on commissions of sales they made. Or, if they brought in other sales people, they received a cut of those commissions as well.
5LINX’s growth accelerated in 2005, when it moved into broadband phone services and created its GLOBALINX® subsidiary. Today the company offers a voice-over-Internet unlimited calling plan for $25 a month to the United States and a select number of nations or $50 anywhere internationally. It also has a line of video phones as part of those calling plans. GLOBALINX® represents 45 percent of revenue.
5LINX® also works as a reseller of products such as home security, cellular phone plans and satellite television. The company has roughly 50,000 customers, with more than 10,000 video phones in the field and more than 35,000 adapters that connect analog phones to the Internet, said Executive Vice President Jeb D. Tyler.
The company’s growth is due in large part to the independent sales force, who pay $99 to $499 to start. 5LINX® currently has 55,000 commissioned sales representatives, almost double what it had a year ago, Tyler said.
"We’ve seen a huge growth in Realtors, mortgage brokers, financial planners," Tyler said. "They’re looking at a Plan B. Why we didn’t have a dip is because of that."