Explosive growth in business operations, particularly its GLOBALINX Voice over Internet Protocol (VoIP) subsidiary, forced company executives to revise their targets significantly upward. "In March, after our Spring National, things just went ballistic," says President and CEO Craig Jerabeck. "We're going to finish 2006 about 50 percent ahead of plan. Then in 2007, we're going to be almost 220 percent of our plan. We just had to rewrite the plan!"



5LINX started as a direct seller of wireless and long distance services in March 2001 when Jerabeck, whose extensive background in telecommunications included franchising wireless retail stores, teamed with Jeb Tyler and Jason Guck, now V.P. Sales & Marketing and V.P. Operations, respectively. Both Co-Founders Tyler and Guck were experienced in direct selling and Tyler introduced Jerabeck to the power of network marketing. "I'd never even heard of direct selling before 1997 or so," Jerabeck says. "5LINX started because Jeb was with another network marketing company and was trying to sell me services from his other company. As I got to know Jeb, I started to understand the power of the direct selling model, and I thought this was a great way to get an army of representatives who would be paid the way I was, which was basically paid on performance."

5LINX' primary product now is VoIP, a high-growth sector of the $400 billion-plus telecommunications industry. VoIP allows individuals and businesses to make voice calls using a broadband Internet connection instead of a regular phone line. According to respected independent technology research and consulting firm Yankee Group, VoIP has 5.5 million users in the United States, and that number is expected to grow to more than 20 million by the end of 2008. Worldwide usage of VoIP is also increasing dramatically. Seeing the trend, 5LINX invested about $2 million this past year to purchase the switching capability to become a VoIP carrier, establishing its presence in the marketplace and giving it flexibility in the products, plans and services it markets.

Moving from being a marketer of telecommunications services to an actual carrier has propelled 5LINX into the desired state of all young network marketing companies: momentum. "When we became our own VoIP carrier, we believe that started the ball rolling and our growing to be the company that we want to be," Jeb Tyler says. "It gives confidence in the distributors' minds that this isn't just an agent company or a network marketing company, but a telecommunications provider as well, and this has opened up more margins, which equals more commissions for the distributors."

5LINX' growth has caught the attention of the broader business community. In 2006, 5LINX came in at number 338 on Inc. magazine's Inc. 500, a list of the nation's fastest-growing private companies. Jerabeck says being on the Inc. 500 list had more impact on the company than he anticipated. "All of a sudden, people feel comfortable with us as a business-we aren't going to be here today, gone tomorrow," he says. "Even though we've been here for five-almost six-years, I think people are somewhat skeptical of our industry. The distributors feel great about it because they already are believers, and now other people know that this is a credible organization they are working with."

From left, the 5LINX management team: Craig Jerabeck, President & CEO; Jason Guck, Vice President of Operations; and Jeb Tyler, Vice President of Sales & Marketing

Tyler adds: "Being listed among the 500 fastest-growing companies in the market has eliminated questions in our distributors' and our prospective customers' minds about the stability and long-term viability of the company. It has added a whole new level of success to our company. We plan on being among the top 500 for the next five years-that's the growth curve that we're on." In addition, 5LINX also made the 2006 Rochester 100 list of fastest-growing companies in that area.

5LINX' executives believe the company will continue to grow rapidly, because they have connected the right products at the right time with the right distribution model. "Eighty percent of the population today does not understand what VoIP is, or is unaware of it," Guck says. "If you're 25 or younger, then you probably understand VoIP. But 50 and up, you're not likely to pick up the phone and say 'Yeah, I want that VoIP' because you probably don't know what it is. We feel network marketing is a much better strategy for telling people what VoIP is-now your friend or distributor can come over and hook it up for you and you've got a dial tone. You start saving money and then you're telling people about it. It's working the way network marketing was designed to work-through word-of-mouth."

Direct selling and VoIP are a great fit because person-to-person demonstration and selling are joined with an emerging technology. Offer people a great business opportunity, and therein lies the formula for explosive growth. "I think our product, especially, is the right product at the right time, but the distribution model works," Jerabeck says. "I was in franchising for a long time before this, and I was franchising wireless stores-we had a great brand and great products. What's unique in my mind about this business is that it allows everyone to become a business owner and franchisee, but it costs next to nothing in terms of cost of entry. It's a way to test the waters of free enterprise and entrepreneurialism and not get hurt. If you like it, it can be a springboard to building a really big business."

Jerabeck, Tyler and Guck have positioned 5LINX distributors to capitalize on another emerging technology that complements VoIP service: the video phone. 5LINX has a direct selling industry exclusive with a manufacturer of video phones. Priced at $199, the GLOBALINX VideoPhone allows users with a broadband connection to hear and see each other anywhere in the world with no per-minute toll charges. "What's exciting," Guck says, "is that 99 percent of the population doesn't have any idea that they can make an affordable video phone call from their home." 5LINX is spreading the word about affordable video telephony.

Demand for the VideoPhone among ethnic communities in the United States is exploding and pushing 5LINX' expansion internationally. Immigrants, particularly from Africa and South and Central America, are purchasing the GLOBALINX VideoPhones and shipping them to family members in their countries of origin. According to Jerabeck, the VideoPhone is a great tool for first-generation immigrants who need an inexpensive way not only to talk to friends and relatives, but to see them. "Now people who haven't seen each other in many, many years can actually see each other for very low cost by using our VideoPhone," he says.

During their company's rapid growth, the co-founders have looked to the Direct Selling Association for guidance and information and have found the organization a tremendous resource. "We have found great value in the DSA, because we have actually networked with a lot of the top owners in the industry," Tyler says. "They have given us a lot of good advice on growth, expansion, some of the pitfalls that they went through and how to avoid making the same mistakes they did. The best way to learn how to become a $100 million- or a billion-dollar company-our ultimate goal for 5LINX is to become a billion-dollar VoIP provider-is to learn from companies who have done it already. We've really listened and found a lot of value in that."

5LINX is a rapidly growing telecommunications company that provides products and services across the United States and in 20 countries. With 15 million people in the United States and an even larger number worldwide expected to become VoIP users in the next two years, Tyler believes they have just begun to scratch the surface. "The exciting thing is that VoIP is really the future of telecommunications," he says. "We're at the front end of this curve, and we expect some major growth over the next three to five years, capturing market share in the VoIP arena. That's our game plan, and helping as many people as we can change their opportunities in life along the way. We want to impact tens of thousands of people with this opportunity. People will save money with the products and also make money with 5LINX."