Sota Toys Keeping Its Product Scarce Key to Toy Maker’s Growth Snaring major licensing deals such as “Street Fighter,” “Tomb Raider,” and “Snoop Dogg,” Lake Balboa-based toy manufacturer Sota Toys has emerged as one of the fastest growing private companies in the Valley. With a growth rate of 91.67 percent, three-year old Sota has been able to make a name for itself quickly, in a notoriously difficult industry to break into. Sota is No. 5 on the Business Journal list of Fastest Growing Private Companies. Founded in 2001, the company originally began as a movie special effects house. However, shortly thereafter, the company’s founder and President Jerry Macaluso began getting requests to sculpt action figures for the various studios he did business with. But it wasn’t until the company acquired the license to produce the action figure for the Lara Croft character from the film, “Tomb Raider,” when business began to really take off. In addition to the those licenses, Sota has also acquired major licenses such as, “Alien vs. Predator,” “Metallica,” and “Planet of the Apes,” among others. According to Jeff Howard, the company’s vice president of business development, this product line expansion has been integral to Sota’s success. “Expanding our product line has been crucial. We’ve increased the number of products per year and our number of licenses,” Howard said. “Next year will be even bigger because we’ll have bigger licenses. We just sealed our first-ever deal with Marvel Comics. We’re going to make a high-end chess set based on titles like Spiderman and X-Men. It will be the biggest thing we’ve done so far.” The company’s strategy thus far has been to appeal to the high- nd collectors of comic book, music and film memorabilia and Sota has been careful to restrict its products’ availability to small, independent collectible shops. The company believes that by limiting its products availability, it allows the products and the licenses’ to retain their collectible value. With a loose workplace environment, it is easier for one to think that growing their revenues was all fun and games. However, Macaluso and his former partner Jess Bansal grew the company the old-fashioned way: hard work, sleepless nights, mailings, phone calls, creative brainstorming and meeting with buyers. Subsequently, revenues shot up from $400,000 in 2002, to $1.2 million in 2003. Since then, revenues have continued to spike, as Sota grossed $2.3 million in 2004 and it projects revenues of $3.5 million for this year. As for the future, Howard says it will all come down to the further acquisition of more and more licenses. “It’s all about bigger and better licenses,” Howard said. “We’ve been persistent and we present a high quality product, so that when we send out a sample of the kinds of things that we do, other potential licensees are impressed.” DLC Inc. From the Start, Financial Consultant Planned for Growth For some companies, revenue growth is a rather unexpected event that can quickly overwhelm any short-sighted CEO. But for other companies, rapid growth is meticulously planned and expected. You can lump, Woodland Hills-based DLC Inc., formerly the David Lewis Company, in the latter category. Impressive revenue growth has been in the cards for DLC, Inc. seemingly from day one, as the company has repeatedly ranked in the top 10 on both the Los Angeles Business Journal and the San Fernando Valley Business Journal’s list of the Fastest Growing Private Companies. From the moment that David Lewis founded the company, he did everything in his power to make the firm as large as possible, as rapidly as he could. “It wasn’t like we woke up one day and said this thing is really working, let’s grow the company. We planned for our growth from the very beginning. It was our intention to establish ourselves as a significant national provider of the financial and accounting consulting services,” Lewis, the company’s CEO, said. “We designed the company in a way that made us unique in the market.” DLC recently opened up an office in Chicago, the company’s fourth office that it has opened. Revenues have grown accordingly. In 2000, the company only grossed $100,000. By 2002, those figures had crept up to $6.1 million. Last year, the firm grossed $14.2 million, and as of the midway point of 2005, DLC Inc. had racked up revenues of $24 million. Its growth rate was 75.30 percent, giving DLC Inc the number seven slot on the Business Journal’s Fastest Growing Private Company list. Yet Lewis is quick to avoid letting his company become static. He continues to envision massive growth for the company as it establishes offices across the country. “Our plan is to quadruple our revenues in the next three years. We set very ambitious growth plans,” Lewis said. “What’s nice about planning to grow at that rate is that you create an environment where people are never complacent because you have to undergo constant transformation to accomplish those goals. The world isn’t a static state of existence and I don’t want the company to be one.” Lewis is also quick to attribute the company’s success to the strength of its employees. Lewis prides his company on the qualifications of its consultants. In order to be considered for a post at DLC, prospective consultants must either have an M.B.A. or extensive experience at a Fortune 1000 firm. Medi-Spa Spa Owner Boosts Offerings, Revenue Since opening her first spa in 2002, Rashel Pouri says she’s reinvented the idea for Angelenos. Before she opened, she said, customers who wanted some medical treatments in addition to purely cosmetic services were often stuck going to doctors’ offices that were too clinical to be very comfortable. Pouri wanted to open a spa that offered pre and post-operative medical treatments as well as cosmetic services set in luxurious surroundings, and opened her first Medi-Spa location in 2002. “It’s different than any other spa you go to. Others (spas with medical services) feel like a doctor’s office, if you want to get a facial or a massage and some medical treamtment, it’s just a doctor’s office that’s been converted,” Pouri said. In addition to massages and body wraps, her customers can get laser treatments for wrinkles, scar treatment and consult with a board certified physician. She seems to have hit on a successful formula, her revenues have increased from $70,000 in 2002 to $1.4 million in 2004. Her company is ranked No. 8 on the Business Journal list of fastest growing private companies. She opened her second location in Calabasas in 2004 and this past year she opened a location in Rancho Palos Verdes. She hopes to open a location in Hollywood by the end of the year. Pouri opened her business partly because she was a dedicated spa customer. “I was going to beauty shops and spas all the time, and I decided that I wanted to open my own business,” said Pouri. “I noticed that there were a lot of treatments with medical aspects, and I developed the idea of a medical spa.” In 2003, a surgical center opened adjacent to her Encino location at her encouragement, and Pouri noted that the two businesses now regularly refer clients to each other. Plastic surgery patients can come to Medi-Spa to recuperate from their procedures under the care of a physician. The company does only minimal print advertising in publications like LA Weekly and Valley Scene. Medi-Spa is also a member of the Calabasas, Encino and Agoura Hills Chambers of Commerce. Pouri said she has hired a public relations representative to get her business more public exposure. She has appeared at the Writer’s Guild of America awards and at social occasions like Academy Awards parties. Pouri has also garnered attention with her charity activities. Once a year, she and Medi-Spa’s medical director travel to different countries to provide reconstructive surgery to children who have suffered accidents. She’s found an ally in her campaign in New York Senator Hillary Clinton, and Clinton recently appeared at a fundraising campaign at Pouri’s Calabasas home. The two have been friends for about eight years. Cal Net Technology Group Deals Growing as IT Firm Expands Fueled by its ability to get larger and larger-sized accounts, Northridge-based Cal Net Technology Group has seen its revenues rise markedly since its inception. Only eight years ago, the fledgling IT company grossed a meager $50,000, but thanks to company President and CEO Zachary Schuler’s leadership, the company’s revenues grew to $3 million last year, and by the half way point of 2005, it had grossed $2.1 million. “Our industry right now is ripe for this kind of growth. We’ve developed closer relationships with our vendors who our leading us to bigger deals, so our business is scaling more into the larger scale business enterprise market,” Schuler said. “Accordingly, our average deal size has gone up. Started by Schuler out of his fraternity house at Cal State Northridge, Cal Net has grown from one employee to 20, and Schuler claims that he can’t hire people fast enough to meet the growing demand. Understandably, it would be easy to lose one’s focus in the face of such expansion, but Schuler schedules weekly strategy meetings to keep the company directed towards the end goal of sustaining this growth. “At those meetings, we discuss exactly how to sustain this growth. It’s certainly not going to be easy,” Schuler said. Then again I don’t think any of us thought a year ago that we were going to hit our revenue goals for this year either.” For now, the company has grown to be one of the larger independent network and services companies in the Valley. But in the always competitive IT service market, Schuler knows that in order to sustain these consistent revenue increases, he will need to rely on a solid group of employees. Luckily for Schuler, he claims that his staff has been a crucial reason why the company has grown so rapidly. “Our staff’s been around for a long time and most of the guys that are here have been here for quite some time,” Schuler said. “The longer they stay here, the better they get at their job. Sales guys need a good year to a year and a half to really produce and our guys are really starting to produce now. Our average deal size has gone up dramatically.” The company has clearly come a long way from when Schuler started it up in 1995. Back then, Schuler was a one-man team, responsible for meeting with clients, servicing their accounts and trying to build a company. However, despite having turned into one of the larger independent network services firms in the Valley, Schuler has not lost his competitive edge. “We always want to stay focused on what we do best. I want us to continue to grow in revenues and to eventually grow the company geographically,” Schuler said. Theiss Institute of Health & Fitness Trainer Rises to Corporate Level With Firm Catering to Health of Executives Brian Theiss was a professional trainer before anyone even knew what that meant. Theiss, who was a power weight lifter in high school, worked as a fitness coach while he was studying for a degree in sports medicine. A few months before his graduation, however, he suffered a back injury while lifting that almost paralyzed him. It was almost a year before he was back on his feet, and six years before he was fully recovered. During his recovery process, Theiss was looking for a career that could support his limited mobility. Personal training had become the newest fitness craze and Theiss’ wife Sarie encouraged him to use his scientific and coaching background to get his certification and start training clients. Theiss started his own business in 1990 in order to train athletes. He and his wife converted their house and scheduled appointments from five in the morning until 10 at night. “The first facility was so amazing, everything in it was a commercial gym except the master bedroom and the kitchen. There was no furniture, only gym equipment,” Theiss said. Two years after starting the business, Theiss redirected it, catering to business executives and corporate clients. This business, Theiss Institute of Health & Fitness, is the No. 10 fastest growing firm on the Business Journal list with a 55.6 percent growth rate. He’s trained executives from Amgen, Guitar Center, Employers Direct Insurance Company and others. “I’ve always been a results driven person, and the business has grown by results,” said Theiss. “We can produce results in 60 days that our competitors can’t produce in a year.” Theiss has recruited clients from across the country in addition to local corporations. Companies often give their executives, top sales performers or other employees memberships at the Theiss Institute. Clients fly back and forth from Westlake Village for a 60-day fitness tutorial. The business reported revenues of $1.4 million in 2004, up from $900,000 in 2003. Theiss said that 2006 will be company’s biggest year to date, because after years of developing his training methods, Theiss is ready to actively recruit clients. To this point, Theiss has increased the company’s business only through word of mouth. “Last year, we got really good and learned how to duplicate every single thing we do,” said Theiss’ wife Sarie Vassallo. “We’ve learned how to hire the right people for our training staff, and to be highly efficient at how to retain them at an industry-desirable level.” A new sales team will be up and running by the first of the year, and Theiss expects that the added business he’s likely to see will necessitate a larger location.