Following exclusive news broken on WhatTheyThink regarding Mimeo's acquisition of UK-based CLE, WhatTheyThink interviewed CEO Adam Slutsky to get the inside scoop.

WTT: Congratulations on the acquisition, Adam.  I noticed in the press release that CLE is moving to a larger facility. Was the CLE move planned before acquisition discussions or part of those discussions?

AS:  The move was planned before the acquisition was completed. CLE is jammed on space and needed a space alternative. We needed to be near a primary distribution hub for the UK with secondary access to overnight for all of Europe.  We have always had strong relationship with FedEx, and thought we should be near their hub, close to Cambridge.  We are also 45 minutes from Stansted airport, and about the same distance from Marston Gate, two important distribution hubs

WTT: What does CLE's production platform look like at the time of the acquisition and how will that change?

AS:  We were definitely looking for someone who utilized similar production equipment, in particular in color. Our plants tend to be heavy on HP Indigos and Kodak NexPress. That was a platform similar to CLE. Secondarily, part of the agenda as we pursued the expansion to the UK is whether we build or buy. That is what took us 2.5 years to figure out, and then we also had the recession upon us. Since we had just finished building our plant in Newark, and building in the UK would cost many millions of dollars, we took our time to make sure we made the best decision for the business.  Although we have lots of capacity demand in the U.S., we didn't have the volume in Europe. We could spend millions based on small revenue, or we could buy someone whose business was using the same digital press backbone we were using, a company with experience selling in the corporate environment, and perhaps with some new products.  

WTT:   Did you look at other companies besides CLE?

AS:  We looked at nine different companies, whittled that down to three, and CLE was the best fit. They have a terrific management team, and they have technology geared toward a product that we are not currently producing that would add incremental volume.  We are bringing front end, back end, and middleware from our years of experience here in the U.S.  Moving to the new location allows us to do a complete change over.  

WTT:   In the past, Mimeo's front- and back-end systems have been very tightly linked, making it difficult to integrate another printer into the mix or export Mimeo's platform to be licensed by others.  What has changed that makes this CLE acquisition viable?

AS:  We have opened up our systems quite a bit. Mimeo used to be a big black box with all of our own systems and workflow and in one facility.  We opened up our platform after a two-year investment in technology completed just last year. It now enables private label front ends; for example, HP has its HP Virtual Print Center powered by Mimeo. We also have private labeled Marketplace storefronts powered by Mimeo for procurement and delivery of printed items. We have also created a separate commerce layer so that people who have front ends but want to use our commerce engine can do that.  
Opening up our systems has enabled new kinds of business for us with channel partners and more work with non-document products and services, such as the photo and publishing spaces where they don't need our front end or commerce; they just need production services and production.  

WTT:   Do you plan more than one location in Europe?

AS:  Each continent will probably have at least two facilities to optimize logistics and distribution, and to eliminate a single point of failure.  If we do another facility in Europe, it would likely be in a different time zone and country. Leipzig, Germany, where DHL has its hub, might be a good location.

WTT:   Looking toward Asia, are you looking to build or acquire?  

AS:  That will be a 2012 initiative.  We have learned that we can ingest one of these about every 18 months.  We have partners who want us to get to Asia. Perhaps we can partner with someone to speed up deployment of services in Asia, but it is too soon to know.  There are so many different location options: Australia, Singapore, Guangjo, China (where FedEx has its hub).  Whatever we do, it will be a similar strategy near a distribution hub.  With the UK in place, we can reach a lot of Asia overnight anyway, but the purpose of this acquisition was to jumpstart our business model in Western Europe.  

WTT:   You referenced a new product area that CLE has, new to Mimeo, anyway.  What is that?

AS:  It is a product called School Planners, one of their most significant offerings.  Here in the States, when kids go back to school, they get their weekly planner book from OfficeMax or Staples, plain vanilla.  CLE figured out that private and public schools have content they need to distribute to the families and students, including communications information, sports teams, course offerings for advanced placement, the student handbook, dress code, discipline, directions to and from different sporting event locations, members of the PTA, that kind of thing.  They have now combined that content with the school planner, so that thousands of schools in Europe are using CLE templates for schools to build compose, produce and distribute their school planners, sold at a price point not much different from plain vanilla planners from the store, but with a lot more value.  They also produce in the yearbook space.  Those two things are a big part of their revenue and the balance would be corporate business, not quite as complex as what Mimeo does.  So this acquisition adds geographic and product diversification as well as seasonal diversification.  Our strongest months are August, September and October for corporate and November/December in the photo space.  Theirs is May, June, July.

WTT:   You seem to be one of the few printing companies that made the Inc 5,000 list of fastest growing companies, which they have categorized under Business Products and Services.  In fact, you are the only print company to have made the list six times-seven when the new list is released next month. To what do you attribute that? I looked through the first half of the list and only found a half dozen obvious printers out of 2,500.

AS:  Printing companies that are typically strong players in their individual markets, and also, most of the printing industry was not online. If they were burdened with a non-online framework, it would be hard to have fast growth.  

WTT:   Do you have plans for expansion into other services beyond print, kitting/fulfillment?

AS:  Probably 20% of our orders have some amount of kitting and fulfillment.  And five years ago not even 5% of our product was shipped out of the U.S.; now it is 10% before CLE.  Marketplace storefronts are a huge growth area; something like 15% of our current business is coming through these white labeled sites.  I do suspect we will get more involved in helping customers in other forms of digital distribution, downloads, sharing digital content, etc.

WTT:   What advice do you have for your peers in the printing industry?

AS:  You have to be looking ahead and take a bet on where you think the world is moving in terms of technology and market segment. Second, how best does your company's DNA fit to that world?  If you are going in nine different directions, I don't think you will succeed.  You have to have focus.  Everyone that sticks to their knitting seems to do better; the trick is whether the knitting is an area of growth.  That is a challenge.  If you think you are totally in the wrong boat, you have to figure out how to get out of that boat.  Business is not for the meek.  One thing I often tell the team members here, when you are in a big company, you have to perform, but your performance is individual performance. If you perform high value relative to your peers, there is probably a life for you there.  In a smaller innovative company, every day is a fight for your life. Every day, someone could come from inside or out and reinvent the way the world works, and you have to jump again.