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• Position: Fulton Breen of XS Inc. - Brief Article

Dot-com helps farmers grow their businesses

Fulton Breen, president and chief executive officer of XS Inc., has pulled some exotic tours of duty in his marketing career: Turkey, Morocco, the Sudan. He's strolled through markets filled with silks, incense, gold and amber. These days, he runs a Web site in Cary. His online bazaar has its own unusual offerings: cow dung, seeds and implements only farmers would recognize.

Breen's XS Inc., which has 20 fulltime employees, went online in January 1999 with XSAg.com, a Web site where six product lines of agricultural supplies can be bought and sold. XS was supposed to be a small side business for Breen, 42, who returned to America from France in 1995 after his most recent assignment for Rhone Poulenc Inc., a French agricultural-chemical and pharmaceutical company. He wanted to take what he had learned in the industry and, rather than work as a globetrotting salesman, establish an Internet outpost for the products.

The 1979 Clemson graduate, who has an MBA from Duke University, presented his Internet business plan to lawyers at Hutchison & Mason in Raleigh in the fall of 1998. They raised $2.5 million from angel investors by December, allowing Breen to quit Rhone Poulenc to work full time on XS.

Last year, it got $20 million from the venture-capital arm of Morgan Stanley Dean Witter. XS is spending about 80% of it on television, print, radio and billboard ads. Breen says XS does "several million dollars monthly" in sales, but "like most Internet start-ups, we're not yet profitable."

The overall agricultural-supply business is worth about $10 billion, but less than 1% is traded online. XS, which collects a 2% commission on each transaction, sells throughout the continental United States. Electronic payment is accepted via Bank of America Corp., which holds the funds until the farmer receives the products in four to seven days.

Breen wants a tightly supervised Web site. He knows most shoppers still view cyberspace as foreign terrain. "My experience overseas was a lot like running my own small business because the locations were remote and I had to feel comfortable in places where the rules and customs were different from anything I'd known."

Playing putt-putt with your caddy

Golf all winter ... then cozy up to the fire all summer. What's wrong with this picture? Nothing, according to Michael McCue. In fact, it's the upside-down success formula for his company, Columbus-based Kangaroo Products Co.

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