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METHODOLOGY

Fast50 nominees must have been in business for at least three years, generate more than $750,000 of revenue, be privately owned and employ five or more people. KraftCPAs, an independent accounting firm with offices in Nashville, Columbia and Lebanon, reviewed nomination information confidentially and tabulated the results.

A recent article in Inc. magazine studied the personality traits of some of the founders and CEOs running the fastest growing companies in America. Hallmarks? They are driven to beat the odds. They adapt well on the fly. They are able to quickly examine a complex situation and cut to the heart of the matter. And they are highly persuasive when it comes to selling prospective employees on the upsides of joining their company versus making a more conservative career choice.

As such, whether for educational or competitive reasons, Business Tennessee’s third annual look at the 50 fastest growing companies in the Volunteer State and the individuals leading them should be required reading for any businessperson in Tennessee. At a minimum, the list provides a snapshot of some of the firms yielding the job growth and innovations that are making Tennessee’s economy surge.

Site Selection magazine recently ranked Tennessee second nationally on its list of the 10 most job-competitive states in the nation, specifically citing the number of new jobs and business expansion projects.

A competitive edge served the company’s on this year’s list in an additional manner—getting them on the list at all. Making the list required standing out in a crowded field—the number of companies nominated this year surpassed the total from the two previous years combined. Clearly, Fast50 status is becoming a much sought after designation and source of pride for companies across Tennessee.

Back in 1973, FedEx Corp. initiated operations with 14 small aircraft. In its first night in business, the upstart company delivered 186 packages to a total of 25 U.S. cities. It would be two years before the company turned a profit.

Why the history lesson? Tennessee CEOs take note. The state’s next corporate juggernaut might just be listed in the following pages.

In 1997, president Sonny Clark left an outdated computer service company to found Advanced Networking Solutions. ANS provides a consultative approach to technology infrastructure, banking solutions, IP telephony, networking security, and technical support to organizations around the Southeast. This is ANS’s second year on the Fast50.

This 18-year-old firm offers diverse marketing, trade show planning, promotion development, and advertising services. Advent Marketing Results’ has become known for its willingness to experiment, such as the time a client’s staff dressed in go-go boots and miniskirts to create buzz at a database marketing conference. The company helped another client transmit a message of hope to its audience by hosting a private showing of the Hope Diamond. Clients include Axiom Advertising and Healthways.

Altair provides marketing data and direct mail and telemarketing prospect lists to the mortgage industry and clients such as Citibank, Time Warner and BankOne. The company maintains a database of more than 74 million records on homeowners and other consumers. Moving Products, a new division forged through a partnership with the Southern Nursery Association last year, targets new homeowners at the precise time they are looking for gardening products and services.

With a Masters in Computer Appli- cation and $10,000 of self-funded investment, founding president and CEO Reena Gupta launched Avankia in 2002. Rajeev Gupta serves as founder and CTO. The company, which also has a software development center in Bangalore, India, provides strategy consulting, technology consulting and staffing solutions to clients including McGraw-Hill, Vanderbilt Medical Center and Yearly Progress Pro, which supports the No Child Left Behind Mandate.

After eight years working for Peterbilt Motors, 28-year-old Brent Parks came to understand the demand in the market from people with five- to 10-acre domestic farms for a specific size tractor, one that’s neither too big nor too small for their needs. Once in business for himself, Parks chose to sell under-40 horsepower Kubota tractors over competing John Deere and New Holland brands, a decision that he attributes to much of his success. Currently, COPE provides north central Tennessee and southern Kentucky with tractors and lawn mover sales and service.

Ultimate fighter Ed Clay is successful in both the business and fighting world. Since 2002, with the aid of several investments from private equity and micro-fund firm The Incubator Group, Clay developed Gameness competition jiu-jitsu apparel and gear, oversaw the construction of a 15,000-square-foot training facility and created the largest distributional market in the industry. In 2005, Clay stepped down to train other fighters, leaving current CEO and Incubator Group partner David Reilly at the helm.

In 1993, manufactured home tycoon Jim Clayton took a troubled West Tennessee bank (the one his family had frequented as a child) and converted it into a regional banking powerhouse. Now with a presence in 10 cities across Tennessee and with more than $600 million in assets, Clayton expects to see even more growth through acquisitions and de novo offices.

From the depths of freelance desperation, Clint Smith and Will Weaver recognized an unusual market while sharing a cold beer together. Small companies needed a cost-effective and easy-to-use e-mail service. With a $400,000 line of credit from SunTrust, the two entrepreneurs created the Web-based service Emma, and now add between 250 to 300 accounts per month. Clients include the Country Music Hall of Fame and Virginia’s Darden Business School. In the future, they seek to establish an international presence.

Clients like the U.S. Army, U.S. Navy, U.S. Attorney’s office and Border Patrol use staffing services provided by Concord Personnel Services. Created in 1999, the veteran-owned, 120-employee company has recently established a new division that provides medical records coding and billing (among other services) to health care providers and facilities worldwide.

Cornerstone Rack and Tooling is a tool supplier for the automotive industry and provides tools, racks and service to support the surface finishing and material handling industries. Founded four and a half years ago by John Lyles, who had recently retired from the finishing industry, and Paul Robinson, who had been in the plastic plating business, the company sets itself apart from other rack makers through its ability to design racks specifically to fit a particular part or application.

Founder Jane Allen was frustrated with the lack of opportunity for capable attorneys who decided the partnership track was not for them. She created an alternative for a legal career. Counsel on Call supplies project and contract work to experienced attorneys. Profitable since its inception, Counsel on Call has been named for three consecutive years on Inc. magazine’s list of the fastest growing privately held companies.

Best known for its Blue Lizard Australian Suncream brand, Crown Laboratories is a pharmaceuticals manufacturer focused on dermatology and oncology, with products ranging from sunscreen to cleansers to moisturizers to therapeutic shampoos. Its other two main branded divisions are Del-Ray Dermatologicals and Med-Derm Pharmaceuticals. The 61-employee company, created in 2000, anticipates future growth from joint venture and product development deals and expanding branded products through increased direct consumer marketing.

CEO and founder Dell Hamilton served as the founder of Progressive Logistics and Vice President of D & D Loading Service before launching Crusader Staffing Associates in 2002. CSA now has accounts in four states with more than $5 million in revenue and 200 employees. Hamilton anticipates his loading and unloading service to eventually reach $15 million in sales and remain stable at that level of production.

The youngest licensed, female, electrical contractor in Middle Tennessee, Wendy Davenport—along with her sister Paige Davenport—own and operate D & S Electrical Contracting. Originally founded in 1989 by their father, Dwain Davenport, with $30,000 of his own money, D & S installs commercial and industrial projects and in the future intends to move into the residential market.

Former Montgomery Bell Academy star and Tennessee Volunteer fullback Will Bartholomew brings a high level of training and therapy learned in the NFL and Division 1-A athletics to serve high school student athletes. With three sports training facilities currently in operation across Tennessee and three more on the way, it seems D1 Sports Training’s 300% growth in 2005 was no fluke. Bartholomew plans on leveraging his relationships with nationally recognized professional athletes and physicians—he operates D1 locations in concert with celebrities including NFL quarterback Peyton Manning and NBA player Shane Battier—to aggressively expand the footprint of D1 Sports Training facilities to 35 locations across the U.S. over the next five years.

After hurricane Katrina, DeNuke Services played an important role in the relief effort. The consulting and service provider for nuclear, environmental, and construction industries recruited and screened more than 150 support workers and built a 7,500 person tent city at the Naval Air Station in New Orleans. Along with new General Manager Ian Howard, the DeNuke senior staff looks to expansion into the emergency response and commercial nuclear sectors of the industry for future growth.

East Tech Company broke ground in May 2006 on a new 30,000-square-foot facility. A producer of custom components for hydroelectric and nuclear power plants and the automotive industry, ETC is a rising star in Chattanooga business circles. President and CEO Rodger Layne, formerly of the Rand Company, intends to expand his facility to 60,000 square feet and double his employee base within three years.

The first national school uniform franchise, Educational Outfitters, which was initially led by mother and CEO Jamey Elrod, was ranked in Entrepreneur magazine’s 2006 Franchise 500 and in the 2005 Inc. list of the 500 fastest growing private companies in America. Elrod and her husband, Brian, turned an idea and $30,000 of personal assets into a 28-store, $8.5 million revenue success positioned to grow to 150 retail locations in 10 years, in part through a savvy relationship with national retail powerhouse Office Depot.

Construction veterans J.R. Ernst, Cliff Ernst, and Mark Flick have known each other since 1984.

In 2000, they created a company specializing in building custom homes with expert finishes. The luxury homebuilders also specialize in high-end renovation and remodeling work. President Mark Flick hopes the flood of retiring baby boomers to Tennessee will in part fuel business growth in the future.

Both formerly of HCA, Todd Abner (CEO) and Ward Brown (COO) implemented the group purchasing strategy taken from the health care business model and made it the foundation of Horizon’s business design. Faced with decreased funding, educational institutions rely on Horizon to cut operating costs through it group purchasing strategy. A membership base of 650 institutions leaves Horizon with ample room to increase sales.

Partners Bill Smith and Jeff Wade took their previous corporate experience implementing COGNOS business software and turned it into a $1.3 million revenue independent company selling and delivering COGNOS’ planning and consolidation, scorecarding and business intelligence software and training. Their clients include Harrah’s Entertainment, Wright Medical, Chattem and BlueCross BlueShield of Tennessee.

Imagine the immensity of the job of swapping out the brand identity of one large bank that was acquired by another. Old signs come down and new signs go up. ATM locations must be completely overhauled. NSA co-owners Chuck West (formerly president and CEO of Tice Technology) and Dean Smith capitalized on the unmet needs of the banking and ATM industry (and a growing sector of other businesses) by forming a one-of-a-kind company that specializes in just those kinds of merchandising and marketing solutions. (Though NSA competes with other companies in each area of its business, no single other company competes head-to-head across the entire line of services provided, whether in the ATM world, the sign industry, merchandising and fixture installation or any special custom project.) For instance, NSA recently completed for Chase Bank a complete interior re-merchandising, visiting more than 1,600 sites over the past two years. In addition, NSA was recently involved in a 45-day project visiting 10,500 locations across all 50 states to assist Cardtronics—the nation’s largest ATM operator—in a re-branding effort. For clients like British Petroleum (BP), NSA provides expertise in drawing the consumer eye to promotional efforts that don’t yield nearly the same results when carried out at the store manager level. NSA has also carved out a niche as a cleaner and repairer of ATMs nationwide. The company’s workforce of more than 400 field service representatives gives it extraordinary flexibility and responsiveness anywhere in the country. Other clients include BankOne and American Express.

Parthenon’s team of 12 marketing, design, and editorial professionals create custom media to help clients better communicate with employees and customers. Clients include TravelCenters of America (TA), for whom Parthenon publishes Road King magazine, a bi-monthly magazine with a circulation of 226,000 that is distributed at TA travel/trucking centers. Other clients include Psychiatric Solutions, IdleAire, HCA, IASIS Healthcare and Spheris.

Chief Technology Officer Dan Proctor built a billing system for his father’s physician practice and recognized the potential for a larger application of his system. Formed in 1996, PHC helps its clients reduce denied claims and associated write-offs through a network of payer data with access to more than 180 million lives. PHC looks to acquisitions and internal development of new products to generate revenue growth. PHC has been a Fast50 company since the inception of the list.

CEO Clay Sifford took PeopleTech far beyond its original founder’s ambitions when he acquired sole ownership in 1998 and expanded its clientele outside of Middle Tennessee. PeopleTech provides audio/visual support and technical services to corporate functions and conventions. With significant revenue already contracted in 2006 and with the opening of new offices in Las Vegas and Washington, D.C., in the last year, PeopleTech appears poised for continued growth.

Watch out! PIPS Technology has more than 6,000 cameras deployed around the globe. A wide range of patents covering their technology—primarily a pulsed infrared camera/illuminator system used for license plate recognition—combined with a increasing demand from law enforcement and intelligence agencies suggests that PIPS has a bright future.

Nashville has a reputation as an astute audio/visual marketplace. John Stone, president and founder, accommodates this discriminating market with more than 30 years experience, including time in the U.S. Navy. PAVE attributes more than 100% sales growth in 2005 to its wide range of clients from universities to homeowners and their rising demand for high-end entertainment and presentation systems.

Military launch controllers and commercial avionics benefit from Protokraft’s high performance fiber optic technology. This combat ready technology emerged from commercial data communications components created for severe environments. In 2005, Protokraft supplied technology to only four customers, but they will expand their customer portfolio to 20 companies internationally in 2006. Protokraft’s founders believe its technology will lead to excellent sales growth and profitability without massive investments in production facilities.

PSC helps industrial, construction and government clients establish safety management systems and OSHA-compliant programs. It also identifies and controls physical and chemical hazards in the workplace. Prior to founding PSC in 2000 with a $400,000 investment of personal funds, its three initial investors operated a division of another company providing the same industrial hygiene, safety and training services. PSC has offices in Nashville, Knoxville and Decatur, Ala.

In the densely populated and ever developing region of south suburban Nashville, Robert K. (Ken) Barnes’ company provides real estate appraisal services ranging from residential, commercial and industrial structures to land, churches, golf courses, wineries, bowling alleys and car washes. Created in 1999, the company has been profitable since its inception. This is R.K. Barnes & Associates’ second time on the Fast50.

Chiefly an importer of all manner of safety products ranging from protective glasses to hard hats to hearing protection (and combinations therein), Radians also operates manufacturing and assembly plants. Its licenses with DeWalt and Remington brand names contribute significantly to sales (the company experienced 100% growth in the past year). Radians recently purchased the first DeWalt license to sell work boots.

Redpepper attributes its spike in revenues in the past year in part to the launch of a new product. The Brandwize product locates a client’s “hotspot” or unique marketing opportunity and evaluates a client’s competitive environment, customer preference, and company reality to identify the best marking strategy. Clients include Averitt, Gwinnett, The Melting Pot and Fleet One.

RM Technologies first turned a profit in 2005 seven years after founder Paul Sponcia’s made his beginning investment of $10,000. Instead of selling specific products, RM Tech focuses on offering solutions in four service areas—basic network services, LAN integration and engineering, WAN communications and infrastructure, and technical assistance. According to Sponcia, RM Tech is on track for 80% growth in 2006.

Jimmy Rodefer, CEO of Rodefer Moss & Co. and partner in sister company RM Technologies, led his accounting firm from 11 employees a decade ago to more than 150 employees and four offices in 2006. Energetic and experienced, Rodefer is widely recognized as a leading entrepreneur in Tennessee and plans to continue his company’s rapid growth through expanding its footprint across other regions of the state.

Approaching $4 million in sales for 2005, Saratoga Technologies specializes in information and communications technology solutions. It recently acquired fellow Johnson City-based Point Blank Communications, the second telecommunications related acquisition and the tenth overall for Saratoga Technologies. The name Saratoga conjures thoughts of the famous Revolutionary War victory. Considering ST’s sustained revenue growth over recent years, the name certainly fits.

Short Bark Industries began in founder Lisa Held Janke’s garage as a restart of her father’s business. Now SBI, a cut and sew operation with plants in East and Middle Tennessee, employs 450 people. The company appears on the Fast50 list for the second straight year. Led by one of Tennessee’s top female businesspeople in Lisa Held Janke, SBI produces military apparel and automotive seat covers.

Ever expanding, the company is a sure bet to create more business page headlines across Tennessee in the near future.

FedEx and Morgan Keegan among others choose the Midsouth’s third largest ad agency for their advertising needs. Started, as company officials tell, with no capital, no office and two employees, Signature’s successful approach is based on what operators describe as a unique “client bill of rights.” At press time, Signature was in the final stages of acquiring Streamline Direct, a marketing logistics, warehousing and distribution company located in Memphis.

Glen Zahn’s previous experience in computer sales and recruiting gave him the idea to form Staff I.T. in 1998. Profitable since 2000, the company places information technology professionals such as project managers, computer professionals, network engineers, Web developers and senior IT managers into contract or direct hire positions. The company has offices in Oak Ridge, Chattanooga and Nashville. Clients include CTI and Pilot Corp.

An atypical architecture and design firm, Studio Four—an employee-owned studio—offers planning, graphics, architecture, interiors, historic renovation, and consulting services. The nine-person firm (of which five are equal partners) located in downtown Knoxville generated $1.1million in revenue in 2005, representing growth of more than 114%. Clients include the UT Athletic Department (which uses the company for graphics), TVA and the Capitol Theater in Maryville. The firm is also collaborating on Knoxville’s South Waterfront Development Plan.

Recognizing China was becoming an important world manufacturer, Wei Chen founded Sunshine International, an import and distribution company, to increase efficiency and cut costs using his Chinese connections. 2005 revenue exceeded $13 million. The company recently opened a factory in China to market to European and Australian clientele.

Sword & Shield Enterprise Security specializes in network security services, providing its expertise in areas as distant as Turkey, Saudi Arabia and South Korea. In 2005, revenues for SSES grew by 247%, topping $26 million.

Early in 2006, SSES became one of the few companies located in the Southeastern U.S. to be designated a Qualified Data Security Company. More growth is on the horizon as SSES moves into the payment card industry.

Revenue increased by 1,177% in 2005 to $23 million. Founded in 1995, Sy.Med began to turn a profit in 2000 after a management buyback.

The company’s main product, Sy.Med OneApp, links employee data to frequently used forms, greatly reducing the burden of paperwork. By leveraging 550 clients throughout 46 states to sell new products. (In 2006, the company introduced OneApp Agency, which can be used to streamline the licensing and paperwork function process for insurance agents and brokers.) Sy.Med expects more growth in future years.

Figuring the United States needed better, lower-cost, low-power sensors to monitor borders, ports, and potential terrorist targets, William Milam and Peter Hansen founded Telesensors. The sensor technology the company sells derived originally from a medical research project and still has medical research applications. As such, Milam believes the need for the technology Telesensors possesses—circuits that can detect nuclear radiation, chemical or biological agents—will only increase in both Homeland Security corridors and the medical community.

The Incentive House helps businesses achieve their goals by motivating employees through merchandise and travel rewards. Created in 2001, the company represents a number of nationally recognized companies whose products and services offered as performance rewards are also effective tools in maintaining morale. Future growth will be driven in part by company store warehousing and fulfillment.

, Oak Ridge, http://www.turnkeytransportation.com/, Tammy Pressnell, CEO

Turnkey addresses transportation and waste management issues at the U.S. Department of Energy’s (DOE) Oak Ridge facilities. One of the fastest growing female-owned companies in Tennessee, Turnkey also consults and teaches clients including the Department of Defense, the Department of Transportation and Bechtel Jacobs Company, as well as other private sector customers responsible for the transport, storage and control of hazardous materials by highway, rail, air or water transportation services.

Valiant Express, Trucking/Transportation, Memphis, Michael Rainey, General Manager

Valiant Express’ expertise is over-the-road long haul trucking. Founded on the strength of 24-plus years of experience and $15,000 in personal funds contributed by Don Davis, Bill Goad and Fred Waldon, VE competes with the best in the industry. Davis, the company president, says Valiant Express can grow as fast as it can find qualified drivers.

Visionary Solutions, Transportation & Logistics, Oak Ridge, http://www.vs-llc.com/, Cavanaugh Mims, owner & president

Understanding the need for cost control and innovation in the transportation and logistics industry, Cavanaugh Mims created Visionary Solutions with a $50,000 home equity line of credit. In 2005, VS grew by 292%, which Mims attributes to winning several contracts including ones with Fluor Fernald Inc. and the Oak Ridge D.O.E. The company has two acquisitions planned for 2006.

Video Gaming Technologies, Manufacturing, Smyrna, http://www.vgt.net/, Jon Yarbrough, president

Taking $1 million from the sale of his Micro Manufacturing Co., former NASA intern Jon Yarbrough created VGT—the leading manufacturer of gaming machines that service casinos in America. Inc. magazine last year named VGT, then a South Carolina company, the fastest growing company in America. VGT expects continued growth through expansion into international markets and opportunities to finance casino developments. (See page 2 Editor’s letter for more on VGT.)

Waterhouse Public Relations, Public Relations, Chattanooga, http://www.waterhousepr.com/, Albert Waterhouse, president

The Tennessee Valley’s largest PR firm, Waterhouse PR was built from Albert Waterhouse’s sweat equity. Waterhouse’s experience included jobs with Hill & Knowlton in Boston as well as time spent working in the office of famed astronaut and U.S. Senator John Glenn. With recently signed accounts in Ft. Payne, Ala., and Clarksville, Waterhouse PR expects continued growth.

The Wills Co., Renovation & Residential Repairs, Nashville, http://www.thewillscompany.com/, Ridley Wills III, president

Owner Ridley Wills III founded The Wills Co. in 1991. Six-year-old sister company Wills Handyman is a natural companion. The Wills Co. recently received three national awards for excellence in renovation and remodeling.

Two came from the Chrysalis Awards program sponsored by Better Homes & Gardens magazine. The third came from Remodeling magazine.

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