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WilmingtonBiz Magazine

The Next Big Breakout

By Neil Cotiaux, posted Sep 28, 2018
Yousry Sayed, president CEO of Quality Chemical Laboratories (Photo by Chris Brehmer)

In Wilmington and around the country, mention Live Oak Bank, PPD or Untappd to someone in their industry and nine chances out of 10 they won’t ask, “who?”

Such companies are not only a source of native pride; they bring new jobs and talent to a community, invigorate the area economy, contribute to the growth of their industry and burnish the image of the place they call home.
 
Here are four homegrown companies that are expanding and attracting more clients, funding or attention.
 

QUALITY CHEMICAL LABORATORIES 

The Wilmington area is emerging as a national hub for research, development and testing in the pharmaceutical world.
 
That’s the assessment of Yousry Sayed, president and chief executive officer of Quality Chemical Laboratories, a 20-year-old company that is about to launch its third wave of expansion.
 
Sayed recently went over initial plans for a potential doubling of the company’s footprint at 3220 Corporate Drive in the North Chase Parkway Industrial Park in New Hanover County.
 
Founded with just one client – Merck – the growing enterprise now serves about 100 clients in any given month, from the top 10 to 15 pharma companies in the world to virtual firms that come to Sayed with limited funding but a big need.
 
Over the years, the company has diversified its offerings as a contract pharmaceutical research and testing firm. Its competencies include testing raw and finished materials, developing analytical methods for newer products and prototyping.
 
In its first two phases, the company added space to accommodate a variety of testing, laboratory and administrative functions, bringing its five-building footprint on the campus off Interstate 40 to about 90,000 square feet.
 
Current employment stands at 215.
 
Now, working with Cothran Harris, principal of Cothran Harris Architecture, Sayed is starting work on a third phase, with preliminary plans for a two-story structure ranging from 60,000 to 80,000 square feet, perhaps more.
 
“We don’t want to under plan,” Harris said.
 
The conceptual treatment for the new building must “convey the idea of quality, convey the idea of competence,” Harris added. “First impressions are lasting impressions.”
 
The building will allow for “more of a vertical integration of what they’re doing,” Harris said, with products being tested, validated and manufactured at the same location before heading to market.
 
According to Sayed, bringing more specialized equipment and manufacturing on-site will allow his business to help clients realize newer product delivery technologies.
 
The new structure could “double our size as well in employment,” he said, with hopes of increasing the number of jobs to 500 within three years.
 
A former professor and General College director at University of North Carolina Wilmington, Sayed said his fondest goal is to not just grow the pharmaceutical industry’s stature in the area but to keep students who are interested in the sciences here, either working for him or starting their own business.
 
With the $5 million corporate donation that Sayed and his wife, Linda, made to the university to support the development of new pharmaceutical sciences and chemistry programs, realization of that goal may be made easier.
 
The pledge, made last year, was the largest corporate donor gift in the school’s history.  
 

FILMWERKS INTERNATIONAL

Founded in 2002 and headquartered in Rocky Point, Filmwerks’ core mission is to provide critical infrastructure such as power, lighting and staging for major broadcast sports events.
 
The company serves about 40 big-name clients and expects to reach more than 100 staff members by the end of 2018 versus the dozen or so that it employed when it first opened, said Aaron Frye, vice president of operations (shown left, photo by TJ Dreschel).
 
When Filmwerks acquired generators, cable and other infrastructure from a competitor, the Pender County-based company snagged The Golf Channel as a client and landed additional business from NBC.
 
Today, Filmwerks services “nearly 100 percent” of all televised golf in the U.S. for CBS, NBC, Fox, The Golf Channel and ESPN, or about 160 tournaments a year, including both the U.S. Open and the Masters, Frye said.
 
Other sporting events served by Filmwerks include the Super Bowl, NCAA Men’s Final Four and the U.S. Open Tennis Championships.
 
To facilitate its far-flung operations, the company has built a network of equipment depots around the country, with the latest brickand- mortar operation in Las Vegas, where Filmwerks intends to provide infrastructure to high-end trade shows, Frye said.
 
Acquisitions will play a key role in helping Filmwerks become even more prominent.
 
Toward that end, Michael Satrazemis, Filmwerks’ chief executive officer, sold a stake in the company earlier this year to Seaport Capital, a New York-based equity investment firm, “to grow at a faster pace than we have,” Frye said.
 
In a June 21 announcement on Seaport’s website, partner Bill Luby said that Filmwerks “fits nicely with our previous experience in the critical infrastructure, data center, and sports verticals.”
 
Filmwerks “stands on its own as an exciting, growing company” as a result of Satrazemis’ leadership, Luby said in a phone interview.
 
Seaport generally invests $10 million to $30 million of equity capital in private companies generating EBITDA (earnings before interest, taxes, depreciation and amortization) between $3 million and $15 million, according to the equity firm’s website.
 
“Our horizon is longer than most firms,” Luby said, with an average “hold” of around six years on its investment before exiting. “We’re poised for explosive growth in 2019, both organically and through acquisitions,” said Frye.
 

N2 PUBLISHING

While the publications industry may seem to be all-digital, all-the-time these days, N2 Publishing built its model by sticking with good old fashioned paper.

 “For our advertisers, print’s audience is controlled, intentional, and specific in a way that other advertising opportunities can’t be,” touts N2’s website.
 
Again this year, the Wilmington based publisher of customized magazines circulated within affluent U.S. neighborhoods made Inc. magazine’s list of the 5,000 fastest growing privately-held companies in the country – the eighth consecutive year that it has done so.
 
According to Inc., the company had $136.9 million in revenue in 2017 and enjoyed three-year growth of 108 percent, placing it at 3,490 on the Inc. 5000.
 
N2 recruits franchisees known as “area directors” who pay a fee to the company to design, produce and ship locally developed content back into the originating communities, including paid advertising.
 
As of Aug. 15, N2 Publishing worked with 980 publications and had 253 home-office employees.
 
“We have a very, very high readership,” said Jim Hall, N2’s chief operating officer (shown above, photo by TJ Dreschel). “Some of our communities are only 200 homes, and some of them are thousands of homes.”
 
Page count and content vary widely among the magazines, Hall added.
 
Craig Biberston, a former area director in Rio Rancho, New Mexico, who now works as a real estate agent, said that N2 provided him with plenty of data when choosing a market. Ultimately, he chose “one of the more affluent communities out here” where he could leverage personal relationships, Biberston said.
 
“It’s an amazing company, an amazing culture,” he said. “They were very helpful with the area directors in terms of explaining what we do.”
 

SEATOX RESEARCH  

Now in its fourth year, SeaTox Research, one of the first tenants at UNCW’s MARBIONC facility, has set its sights on finding faster, more efficacious ways to detect toxins in marine life that enter the food chain and pose a danger to human health.
 
A for-profit company whose research will “spin out as products,” SeaTox’s goal is to create toxin-detection kits to be sold to state regulatory agencies that control commercial access to seafood beds as well as to authorities overseas, said Jennifer McCall, the company’s chief executive officer and an assistant professor in clinical research at UNCW, (shown above, photo by TJ Dreschel).
 
Armed with state and federal grants totaling $1.9 million, McCall, her biologist husband and a laboratory manager are now involved in finalizing a process that tests shellfish for ciguatera, a disease found mostly in the tropics that can lead to cramps, diarrhea, nausea, and other maladies and that affects tens of thousands of individuals annually.
 
As that testing continues, SeaTox is expanding into other areas.
 
Work is underway to better detect a paralytic shellfish toxin that can afflict people repetitively and in severe cases kill them, McCall said, and research on a method to combat a third toxin that triggers short-term memory loss and can also cause permanent brain damage is not far behind.
 
Across the globe, “Native peoples that rely on local seafood beds” are expected to benefit from all three studies, McCall said.
 
Commercialization of the ciguatera kit has begun. “We have people that currently buy our beta test kits,” she said.
 
McCall hopes that her company’s research will shine a spotlight on MARBIONC’s mission, attract more marine biotechnology and general biotechnology firms to Wilmington and, like Sayed, create homegrown opportunities for students.
 
We will “continually have products in the pipeline,” McCall said.
 
On their own or taken together, Quality Chemical Laboratories’ coming expansion, Filmwerks’ equity funding, N2 Publishing’s continued presence on the Inc. 5000, and the first sales by SeaTox of a product with global reach represent strong vital signs for the area’s economy.
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