For L2 Solutions, the gig is in the mail For L2 Solutions, the gig is in the mail (February 26, 2003)

Palo Alto software firm aims to streamline direct-mail campaigns

by Cheri Lucas

Just shy of its second birthday, L2 Solutions of Palo Alto has struck big. The marketing-software company announced an agreement with The Permanente Medical Group last month to improve communication between 3 million Northern California Kaiser members and their physicians through standardized electronic and print mailings that target patients' interests or needs.

It is the start-up's biggest contract to date. Founders Lawrence Chang and Lawrence Suen -- hence the name "L2," for the pair of Lawrences -- established the company in May 2001 to streamline what they saw as the labor-intensive process of launching a direct-mail campaign.

Chang brought with him a background in marketing, public relations and business development. Suen had expertise in software engineering and development. Since L2 Solution's founding, the business has grown to 16 employees. Several members of management previously collaborated at ELetter, a fallen San Francisco Internet start-up that offered mass-mailing services to small businesses but did not possess the software that Chang and Suen created. L2 employees, who range from their late 20s to 50s, have experience in graphic arts, customer service and financial advising.

The L2 team provides companies with software products that encompass the data management, design, print, distribution and response-processing of direct mail.

"Many competitors just focus on portions of what our software can do," Chang said, handling only print production or document design or data collection, for example.

Their software product takes data collected about the company's customers, designs a document based on the customers' demographics and needs, and automatically sends it to a facility where mail is printed, stuffed, sealed, cut and distributed to the customers via print or digital media, Chang said. The result is a standardized piece of mail to which customers can respond.

The L2 team works in a building shared with several other organizations on Corporation Way, east of Highway 101. Composed of a small conference room and two adjacent rooms -- one for the engineers, the other for the marketers and sales executives -- the office is cozy, casual and warm, perhaps due to the electrical buzz of computers.

They hope to relocate to a different floor or space as they expand.

Chang describes the company culture as a "close-knit family without any egotism, where decisions are made collectively."

Funded by a few private investors, L2 Solutions maintains a grassroots philosophy of growing through sales. "The funding landscape has pretty much dried up," Chang said, and those who are willing to provide funding will take 50 percent or more of the company. Currently, not much funding is available for advertising their product.

The economic downturn has affected the company in sales as well as funding. "Clients who we have spoken with are very interested in our product, but due to the slowdown of the economy, they are more cautious on how and when to spend their dollars," Chang said.

The recent agreement with The Permanente Medical Group, then, has made a significant impact on L2. "Our company is now able to become more robust," L2 Solutions president and CEO Wrich Printz said. The deal has helped the company gain additional contracts with other healthcare firms while opening up the possibility of partnering with other local companies.

Currently, L2 Solutions has a partner network of printing organizations such as Benjamin Litho Inc., Creo and EP Imaging Concepts. They have a firm base of healthcare clients, and other clients include a local branch of Merrill Lynch as well as out-of-state businesses in Eugene, Ore., and New York City. Printz said the company would like to target other categories of clients, including financial services, retail and manufacturing, and government services.

These potential clients, similar to The Permanente Medical Group, share the common need of establishing a corporate identity and a secure and swift means of attracting and responding to customers while maintaining a personal level of communication, Chang said.

Richard Fury, medical director of The Technology Group at The Permanente Medical Group, said, "This customized software will improve our external communications, customer service, response times and efficiency." Their launch of L2 Solutions' software is scheduled for April. For more information about L2 Solutions, visit www.l2solutions.com. Cheri Lucas can be reached at clucas@paweekly.com.