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Aerospace contracts lift sales at Lucix

By   /   Monday, May 31st, 2010  /   Comments Off on Aerospace contracts lift sales at Lucix

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Camarillo-based Lucix Corp. is on track to double its revenue to nearly $30 million this year after winning a big contract with Boeing for a NASA relay satellite.
 

Lucix makes communications gear for satellites and has about 120 employees. A handful of major companies — including Boeing, Lockheed Martin and Northrop Grumman — make satellites, and Lucix counts them all as customers.

“We’re working for a program for $25 million for Boeing, and in turn their customer is NASA,” Lucix CEO Mark Shahriary said. “When NASA has a mission, in order for the mission to communicate with NASA, they go through this satellite.”

By any measure, Lucix has graduated from an entrepreneur’s startup in 1999 to a thriving mid-sized business. It had about 40 employees when Shahriary became CEO in 2002 and has continued to hire new workers each year. Its revenue was about $15 million last year and is expected to reach nearly $30 million this year, Shahriary said.

Shahriary and much of the company’s core team came from Hughes Space and Communications, a satellite business where Shahriary was chief operating officer. It was bought by Boeing in 2000. Some of Shahriary’s former colleagues rose through the ranks at Boeing and Lockheed, connections that helped Lucix get a foot in the door in the space business.

“Usually, when these companies that build satellites go to a small company to get some piece they need, it’s like a catch-22,” Shahriary said. “They won’t give you a contract until they see you’ve built them, but you can’t build them because you don’t have any contracts.”

After pushing to get the Lucix factory in Camarillo up to the clean-room standards required by NASA, the company won a small contract from Boeing that gave it a chance to show its stuff.

“This is a space business. The most important criterion is not money or schedule or cost of hardware. The most critical part is quality,” Shahriary said. “Whatever you make has to last 15 years.”

Lucix has expanded over the past decade with only about $15 million in venture capital raised, a relatively small sum in the capital-intensive business of building space-based communications gear. At Hughes, Shahriary operated a $2-billion-a-year company, but he had to run lean at Lucix.

“When you come to a company which at the time was 40 people, there’s very little money to buy the equipment you need,” Shahriary said. “You have to slowly build it. And that’s been very difficult.”

Lucix has tapped the Workforce Investment Board of Ventura County for help finding employees. The company’s manufacturing is high-skill, high-specialization work, and about 30 percent of the its employees have come through the board’s Job and Career Centers, said Cheryl Moore, executive director of the board.

“They’ve emerged,” Moore said of Lucix. “They’re continuing to grow, but that growth has been based on solid steps and solid foundations.”

Lucix co-founder Joan Baldarrama has joined the Workforce Investment Board’s outreach committee as a “door-to-door ambassador,” Moore said, to spread the word to other Ventura County small businesses about the services the board offers.

“The company also wants to reach out and help other businesses grow and develop,” Moore said. “Lucix is a role model for innovation, willingness to learn and the capacity to grow on multiple levels.”

Lucix is on the cutting edge of more than just technology. It’s done away with corporate secretiveness and old ways in favor of “what makes sense,” as Shahriary puts it. Even hourly employees have access to financial information about the company, and there are no one-sided performance reviews.

“I have always believed the role of management is to go around and ask ‘What can I do to help?’ rather than directing people to do this or that,” Shahriary said. “We never have reviews here. We believe that rather than an annual review you should have constant feedback with employees so they know where they stand.”

Samuel Culbert, a board member at Lucix and a professor of management at the UCLA Anderson School of Management, has worked with Shahriary for more than a decade. Shahriary’s effectiveness, Culbert said, stems from his ability to talk straight with employees about both strengths and weaknesses.

“He’s totally collaborative and very fair,” Culbert said. “Mark is tough-minded but totally likable because of the respect and focus he gives everybody. He’s doesn’t just empathize — he gets people.”

But Shahriary, who holds a doctorate in applied physics, prefers to talk more about his plans for Lucix than about his management style.

He wants to move the company into making entire sub-systems for satellites and, eventually, providing nearly the entire payload. And there are burgeoning opportunities to supply parts of military satellites.

“We’ve been working on that for the last five years. In 2012, it’s going to go into big production,” Shahriary said. “Finally, it will go into a bigger scale of delivering sub-systems rather than just components of sub-systems.”

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