Xchange Technology Group of Morrisville is on the upswing after emerging from bankruptcy.
The 200-employee business enjoyed a 27 percent jump in revenue last year and "2015 looks incredibly strong for us," said CEO Alan Rupp. The company exited bankruptcy in January.
The company has 81 workers in Morrisville after doubling its local contingent of employees over the past two years. In addition to hiring to handle the company’s expanding business, some of that local growth came from moving operations previously based in Minneapolis.
Xchange has four interlocking businesses which sell new and refurbished computer equipment, as well as providing new equipment through short-term rentals. It mostly focuses on the business market but also supplies hardware to K through 12 schools.
Its largest business, IT Xchange, which accounts for about 60 percent of its revenue, sells new and refurbished PCs and low-end servers that brands such as Lenovo and IBM have withdrawn from the market to make way for newer models. In addition to selling those products to systems integrators and value-added resellers that cater to businesses, it also sells components, such as hard drives and memory, that can extend the life of a customer’s existing hardware.
Given the savings involved – refurbished PCs and servers can sell for 30 percent to 50 percent less than new devices – demand persists during both up and down economic cycles, said Oksana Cobey, senior director of global marketing and strategy.
In December 2013, however, the company filed for bankruptcy in the U.S. and Canada following an ill-fated expansion into Europe, where it had acquired two struggling hardware rental companies two years earlier. Those businesses, which have since been divested, siphoned off cash that the company needed to maintain sufficient inventory for its North American business, according to Rupp.
“It just brought the U.S. and Canada business to its knees,” Rupp said. “Inventory is a critical part of our business. We’ve got to be able to get product to a customer within 24 hours.”
A Canadian company that specializes in loans to distressed companies, Callidus Capital, acquired Xchange’s debt in October 2012 and backed the company’s restructuring through the bankruptcy process. Today Xchange is a wholly owned subsidiary of Callidus, but the company’s headquarters and senior management are ensconced in Morrisville.
Rupp, who joined the company as chief financial officer in 2012, was named CEO after the company went into bankruptcy. He hopes to eventually lead a management buyout of the business.
“We’ve talked very openly about that,” Rupp said.