The idea for XanGo LLC of Lehi took root when one of its founders, Joe Morton, fell in love with the mangosteen after stumbling on the tropical fruit at a restaurant in Malaysia.
Long recognized in Asia for its healing properties in treating infected wounds, tuberculosis, malaria, urinary tract infections and even sexually transmitted diseases such as syphilis, the mangosteen piqued the curiosity of Morton, who was then helping his former employer, Orem-based Enrich International, now known as Unicity, to start a nutrition supplement division in Malaysia.
The company's patented flagship health beverage, XanGo, was born after Morton found numerous scientific reports that supported the health benefits of the mangosteen and after the company entered into a strategic partnership with Wild Flavors, a Heidelberg, Germany-based health beverage maker with clients such as Sobe, Capri Sun, Hershey and Kraft.
Today, Wild Flavors not only processes the mangosteen-based beverage at its Cincinnati manufacturing plant, but also sources the fruit from Southeast Asia for XanGo.
"Creating a category of new dietary supplements using the mangosteen was a challenge initially, especially when very few people in the U.S. have heard of the fruit," said Aaron Garrity, XanGo's president and chief operating officer.
But that didn't stop the company from making the coveted Utah 100 MountainWest Venture Group's list in October of 12 emerging elite companies and ballooning its work force to more than 300 workers in just two years from 14 in 2002.
Garrity attributed the company's success to its focus on growing its market share in distributing XanGo.
"We're not launching 25 new products every six months like many nutrition companies do to try to keep their markets going. We have just one focus. That focus simplifies the process for us from manufacturing to distribution."
The company also derives its strength from its executive team, many of whom have a background in nutraceuticals.
Joe Morton, XanGo's executive vice president of operations, acquired a strong background in botanicals because his father, Gordon, was general manager of Nature's Sunshine's Canadian unit. Kent Wood, XanGo's chief financial officer, was former controller of Nu Skin and also Morinda Co., parent of Tahitian Noni. Gary Hollister, XanGo's chairman and CEO, was former president of Enrich.
To accommodate its growth, XanGo acquired a 29-acre property at Thanksgiving Point's business park in Lehi that includes a 60,000-square-foot building and relocated its corporate headquarters there from Draper. It also plans to build two 90,000-square-foot buildings on the property and hire another 50 workers in Lehi by year end.
"The geographic location is ideal for our employees and local distributors since it is situated almost mid-point between the two major residential regions of the Salt Lake and Utah valleys," Garrity said.
To protect its market share, the company is also aggressively defending its patent rights to the exclusive use of the mangosteen for its health drink.
In July, XanGo filed patent infringement claims against several entities including New Vision USA Inc. to stop them from making and selling New Vision's Essential Vitamins Plus Mangosteen.
The parties have agreed on a trial date to submit to the court and the case is moving forward, Bryan Davis, XanGo's attorney, said in the statement.
The company also plans to grow its market share in China and is watching Nu Skin Enterprises Inc.'s efforts to adjust to heightened Chinese government scrutiny ahead of new laws being implemented in China to ease restrictions on direct selling.
"Nu Skin helped pave the way for Utah's nutraceutical industry to grow in Asia. It helped facilitate us doing business there," Garrity said.
XanGo LLC
Owners: Gary Hollister, Aaron Garrity, Joe Morton, Gordon Morton, Bryan Davis, Kent Wood
Founded: September 2002
Industry: Maker and direct seller of dietary supplements
Locations: Corporate headquarters at 3098 W. Executive Pkwy. in Lehi, and one international office in Tokyo. Several warehouse operations in the U.S., Japan, Canada, Mexico, Hong Kong, the UK, Australia, New Zealand, Puerto Rico, Trinidad and Tobago.
