The Evolution of Xenetech Global, Inc.

Copyright © 2003 by Davis Multimedia, Int'l. All Rights Reserved.
As Printed in August 2003, Volume 29, No. 2 of The Engravers Journal.
By Connie Mulqueen

     Bill Townsend was on a mission. While at an engraving trade show in Texas in the early 1980s, he hoped to find an engraving system that would increase productivity for his North Dakota-based award company. There, he met and developed a friendship with the man who would eventually design the engraving system that would take his company to a whole new level.
    When Townsend discovered him, Jay Hoffpauir was barely noticeable, sitting alone at a small table. “He didn’t have a product yet, but he had a vision of what he wanted to build,” says Townsend, president of Dakota Awards in Bismarck, ND.
    Townsend sat down with Jay and learned that the self-employed entrepreneur had bought one of the first computerized engraving systems ever sold, Dahlgren’s System One. Jay’s Baton Rouge, LA-based company, Hoffco Sales & Supply, had been producing signs and tags primarily for Baton Rouge’s multiple electrical contracting companies and industrial plants in the chemical rich Southern Louisiana corridor.
    A rising demand for the tags had compelled Hoffpauir to tinker with the software that came with his new Dahlgren system. While playing around with the software, Hoffpauir came up with a revolutionary program with many of the features Townsend was seeking.
    “I sat down to talk with him,” Townsend says. “I shared some ideas that he had not thought of, and he immediately started adding those features to his software. When we finished speaking, I told him I would buy his complete engraving system when he got it into production.”
    Then in 1982, Jay developed the first software with grid cutout and long plate/tall plate capabilities. The new system made it possible for nine plates to be cut out simultaneously, a major turning point for the industry. Hoffpauir later went on to develop the first graphics-based, mouse-driven software for engraving and sign-making. This second major accomplishment made it possible for engravers to see their products first on the screen before producing them.
    Jay and Townsend kept in touch, calling each other with ideas. “I purchased one of the first batch of Xenetech engravers, an SOT-ie,” Townsend says. “Jay would have me test his new ideas on my equipment and give him feedback, and I would come up with ideas that he would incorporate into the product.”
    By 1987, Jay and several partners formed Xenetech, which started out as a software developer for the engraving industry but later expanded to include compatible hardware systems. Still based in Baton Rouge, the company is now a leading manufacturer in rotary and laser engraving equipment, as well as the software to drive those systems.

Xenetech founder, Jay Hoffpauir, (1950-2000). The leadership team outside their offices in Boston Rouge, LA.

    With more than 5,000 clients and a worldwide distribution network, Xenetech sports one of the broadest product lines in the industry, with a full range of rotary and laser systems, electronics and engraving software. Customers include small trophy and award dealers, large manufacturers, government agencies and large, prestigious corporations such as Boeing, General Motors and Ford Motor Co., to name just a few.
    In 2000, Xenetech was named the Baton Rouge Company of the Year and earned the coveted “Supplier of the Year” award from Crown Trophy, the largest award business franchiser in the industry.
    Xenetech has also purchased Meistergram’s engraving-related operations within the past five years and a manufacturing and administrative location on Airline Highway in Baton Rouge.
    After a long battle with cancer, Jay Hoffpauir passed away in 2000, but the business continues to thrive with his family members at the helm. Jay’s wife, Kathleen A. Hoffpauir, chairs the board while her brother, Guy Barone, leads the company as president and CEO. Hoffpauir and Barone both continue Jay’s vision to stay on the cutting edge of technology while providing state-of-the-art customer service. They both helped Xenetech form in 1986. Barone assisted in the recruitment of investors and handled all administrative duties as vice president of operations. He left the company in 1989 but rejoined in 1996.
    Another major player is Jay and Kathy’s daughter, Jessica Hoffpauir-Freeman. During her nearly 12 years with the company, she has helped to recruit 31 distributors in the United States and worldwide and attended more than 70 trade shows. She began her Xenetech career answering phones after high school and worked her way up, serving in many roles, from shipping clerk to her present position as director of marketing.
    “When friends ask me what I do at Xenetech, I tell them, ‘I am the glue.’ I am the jack of all trades here,” she jokes.
    It’s true. She does everything from answering phones and cleaning restrooms to handling an average of 250 sales calls a week, coordinating the company’s participation in all the trade shows, developing the website, placing ads, organizing photo shoots and producing the company’s sales and marketing literature.

Xenetech's XLT-1325 laser engraving machine. Guy Barone (President and CEO) and Kathy Hoffpauir (Chairwomen of the Board).

Cutting Edge Products
    Xenetech’s product line continued to grow by leaps and bounds after the company’s formation in the mid 80s.
“We set out a few years ago with a goal to enable our distributors to walk into any engraving company and provide them with a custom solution,” Barone says. “Whether it’s a question of supplying the latest laser or rotary system, updating an existing system or offering cutting edge software, we are always trying to offer the best technological solutions possible.”
    In 1992, Jay learned how to convert text to Grade II Braille in response to the American Disabilities Act, thereby developing the Grade II Braille translator and incorporating it into his software at no charge to his customers. “I called him to tell him I needed a Braille system, and it took him a month and a half to learn about Braille and write the code so that his software could translate text into Grade II Braille,” recalls customer Townsend.
    Long before the advent of Microsoft Windows software, Xenetech system users were engraving with software with a Windows-like feel running under the GEM operating system.
    Other accomplishments during the 1990s included the first Microsoft Windows-based engraving software, micro-stepper electronic technology for new and existing customers, the ability to hatch-fill TrueType® fonts and the first software package designed specifically for laser engravers.
    In 1998 Xenetech became the only manufacturer of a full line of rotary engravers, laser engravers and engraving software and surpassed industry-standard rotary speeds two years later by more than 300% with the Servo System Series. Also, in 2000, the company achieved laser engraving’s “century mark” with speeds of 100 inches per second.

John Lundberg, V.P. of research and development worked closely with Jay to create the company's products. Xenetech's leadership team inludes (seated left to right) Ben Rosenstein, John Lundberg, Guy Barone, Kathy Hoffpauir, (standing left to right) Carey Solomon, Drew Brown, Jim Brown, Jessica Hoffpair-Freeman, Jason Milton and Jimmy DuBose.

A Software-Driven Company
    What seems to give the company a competitive edge is its ability to produce compatible hardware systems for its software programs. Xenetech originally started as an engraving software developer and distributor then decided to manufacture hardware systems around its software.
    There are inherent advantages to purchasing software and hardware created by the same company, Barone says. “For instance, when a customer has a question about the software, the company where they bought their equipment almost always has to refer them back to the software company,” he says. “But when a customer has a question about our hardware or software, we can get to the bottom of it right here.”
    Most companies that supply engraving hardware rely on third-party software to drive their systems rather than developing their own programs, says Xenetech’s president, Guy Barone. “Most of the software was originally developed mainly to serve graphics environments for the sign industry and others,” he says. “Engraving system manufacturers then convert those programs to engraving applications. Our software is designed from the beginning as engraving applications.”
    Barone says the company’s premiere XGW 32 Bit Software system has evolved since the mid-1980s in response to the growing needs of customers, starting with features like multiple plate and grid cutout and expanding to provide the ability to perform multiple tasks.
    “That’s what’s so special about them,” says Paul Todisco, president of Crown Specialties in Garwood, NJ “If something’s not working right for me, they don’t say, ‘That’s too bad. That’s just the way our machine is, and you’re just going to have to make do.’ As problems and needs come up with their customers, they listen and incorporate changes into their later versions. That’s why I stay with them. They are never satisfied with their products. They are always looking at how they can make their products better, and part of that is listening to their customers and accommodating their needs.”
    Another selling point for Xenetech software is the company’s ability to retrofit its most technologically advanced electronics and software to its oldest machines. “Customers do not want to spend thousands of dollars to buy new machines every time there’s an upgrade,” Barone says. “Our technology moves so fast that the hardware is obsolete before the customers get full use from their machines. That’s why we are committed to retrofitting our new electronics and software programs to the old systems, which is much less expensive for our customers. They get the advantages of the new technology while still getting good use out of the old hardware.”
    “One of the key components driving us over the years has been a strong desire to make sure we do not harm existing customers,” says John Lundberg, vice president for research and development, who has been with the company for 15 years, working alongside Jay in creating the company’s products. Lundberg played a major role in every Xenetech product design currently in use today and led the design effort behind the revolutionary XLT and XLE laser engraving systems, as well as the new Viper electronics system.
    “By that, I mean that our vision was to never punish the customer just because we come up with something new,” he explains. “Take our engraving tables, for instance. Our table line has been the same since the early 90s. Our 1313 and 1625 tables look exactly the same. Sometimes, people ask us, ‘Doesn’t that hurt you?’ I just answer, ‘Why change a good thing?’ Our goal is to give our customers tools that facilitate engraving at a much lower cost than a complete new system.”
    Barone adds, “This is part of our commitment to specialize in bringing the latest technology to companies. When they buy into a partnership with us, they are making an investment that ensures their continuation in keeping up with the latest technology.”

Braun Jones is setting up a cylindrical attachment to be tested on the Aurora laser engraving system.   Barry Weaver is building z-axis assemblies for Xenetech's line of rotary engraving tables.

Advanced Laser Technology
    The purchase of Meistergram’s engraving machine division in 1998 provided Xenetech with laser technology through an engraver capable of producing 15 inches per second (ips). Xenetech immediately began devoting a great deal of resources to improving the technology. The company’s software developers were able to bump the speed up to 100 ips by the year 2000. And in 2002, they upgraded the laser again to 120 ips and named it the XLT-1325.
    “The XLT was developed as a result of a rising demand for increased speeds,” says Lundberg. At the same time, customers were having trouble with their machines because they were forgetting to lubricate the standard bearings, which often leads to premature bearing failure.
    “The answer proved to be switching from roller to polymer bearings because roller bearings cannot achieve high-speed accelerations and polymer bearings can,” Lundberg says. “Roller bearings also require lubrication, which attracts dirt and leads to breakdowns. The polymer bearings took care of both problems. They allow us to go up to 120 to 150 ips, and they do not need lubrication.”
Improved Rotary Engraving
    Xenetech has pushed the outer limits again with rotary engravers. The company offers five types of engraving tables and recently added the Viper electronics series to their industry standard and Servo Series systems that drive the tables.
    It was less than three years ago that the company increased the rotary speed of the industry’s standard rotary engraver by three to five times with the Servo Series.
    Now with the Viper series, they have changed the definition of rotary engraving with even faster engraving speeds of up to 10 ips and an easy-to-use touch-screen key pad. And the system is completely retrofittable to older rotary engraving tables.
    “With Viper electronics, our customers can now drive the stepper system as fast or faster than a Servo machine,” Barone says. “It gives the user total control over the jobs. This creates a much more productive and less stressful work environment.”
Customer Service a Priority
    Xenetech’s priority is to stay “plugged in” to meeting the needs of its customers with an extensive, highly knowledgeable customer service staff that is well trained and experienced in the business, says Barone, who stresses that customer service is “one of our core competencies.”
    Kathy Hoffpauir, who helped her husband build the company, says Xenetech’s customer service, without question, is the greatest contribution to its success. “We’ve tried to make all our employees understand that when our customers are down, their businesses stop,” she says. “Jay and I owned an engraving business before we got into the software business, and we know what engravers need and the problems they face.”
    Jessica Hoffpauir-Freeman worked for her parents’ engraving business as a teen. “I learned to fear what could happen if something went wrong with the machines, which is what drives me today when dealing with customers,” she says. “I want their machines up and running. I want them pushing out jobs. My goal is for them not to fear impending doom because they know we will get right on any problem they have.”
    Barone adds, “It is not uncommon to see one of our customer service representatives personally drive a package to Fed-Ex at 7 p.m. so a customer doesn’t experience down time or for our development staff to create a product feature that a customer requested earlier in the week.”
    Xenetech looks at the product “from the cradle to the grave”, Barone says. From the introduction of a new product, he explains, Xenetech makes sure it supplies ample support documents, help files and other resources, such as videotapes and maintenance posters that customers can hang on their walls. That way, they have easy access to immediate help and the tools they need to survive.
    “But we are always available to answer questions and help them if they cannot figure something out on their own,” he says. “They can always fax or e-mail us, too.”
    Xenetech also has strict training procedures for distributors so they can help customers apply the equipment to their individual needs. The company even provides a pager service and a beeper service during holidays.
    Barone says Xenetech is fortunate to have talented and dedicated staff members, partner-vendors and distributors factory-trained to sell, install and support all Xenetech products. In addition to the Hoffpauir family, other employees have made major contributions.
    Carey Solomon has contributed as the chief architect of Xenetech’s information systems infrastructure and has written a number of installation programs currently in use by Xenetech customers.
    After starting as a Xenetech customer service representative in 1992, Jim Brown made significant contributions to the software product offering. Promoted to software development manager in 2000, he led the project team that upgraded XGW 32 from a 16-bit environment to a 32-bit application. He has written a driver to allow CADlink products to output to Xenetech rotary engraving systems.
    Jimmy DuBose already possessed production and sales experience with Xenetech equipment when he joined the company in 1996. After serving as a customer service representative, he became Xenetech’s sales manager and has created a customer following from his years as a trainer and workshop teacher.
    And Drew Brown worked his way up to production manager from his entry into Xenetech in 1995 as an assembly worker. He has earned respect from people inside and outside of Xenetech for his responsiveness and ability to make things happen.
    “One of the big things missing in corporations today is the personal touch,” says Jessica, who is grateful to work in a family business where she can give a little extra to each customer. “We want our customers to succeed because we feel like we are an extension of our customers.”
    Longtime customer Bill Townsend is impressed with the way Xenetech continued moving forward after Hoffpauir’s passing. “I admit, some Xenetech customers wondered when Jay’s health went downhill what would happen to the company,” he says. “There was concern that the company might not have the strength to continue without Jay’s leadership. But Xenetech’s customer service and technological excellence continue to be unsurpassed. Jay built a great team with a lot of talent. I’m sure he would be pleased. I have tremendous confidence in Xenetech’s future.”