(FORTUNE Magazine) – Digital document transmission HQ: Alexandria, Va. Founded: 1995 Employees: 60 Sales: $4.4 million Stock: Privately held Address: www.digitalpaper.com

As a newly minted mechanical engineer working for a consulting firm in Philadelphia, John C. Cronin III had a pet peeve: He hated collaborating with global clients, because sharing oversized paper plans was a royal pain. He knew one manufacturer, for instance, that sent paper plans to a Mexican client by overnighting tubes to an employee living in El Paso, who would then drive the plans across the Texas border--all to avoid a three-day delay in getting the plans through customs.

Digital Paper, the company Cronin founded at age 24 to solve such problems, aims to banish the big tubes stuffed with blueprints by making it possible to send large technical documents over the Internet quickly and securely. Digital Paper's software breaks documents down into small 50-kilobyte packages, making for fast downloads. Engineers can e-mail plans in whole or in part, with comments and changes. They can also preserve historical renderings and search their database for earlier versions. The software works with documents created by any graphics program, as well as with hard copies scanned into the system.

Digital Paper's co-founder and technical guru, Cecil V. Hornbaker III, 44, was a software engineer working in Florida when he met Cronin through a mutual acquaintance. During a phone chat one day, Cronin mentioned his idea for Digital Paper. A week later Hornbaker materialized at an airport where he knew Cronin would be changing planes, and presented him with a working prototype. Today Hornbaker commutes from Florida to Virginia, where he manages to write code in raucous surroundings; he shares his office with the company foosball table.

Part of what makes Digital Paper cool is the business behind the product. According to the Gartner Group, the electronic document market will hit $22.7 billion this year and is expected to double by 2003. With backing from Xerox (which hopes the technology will promote sale of its scanners), Digital Paper is now used by more than 50% of FORTUNE 100 manufacturers, including General Electric, General Motors, and Boeing. Why are they interested? Well, consider that in 1998, Boeing produced 38 million aperture cards--checkbook-sized punch cards with slides of drafting plans attached. From now on they will be digitized and transmitted electronically. That's a lot more efficient, and cheaper too.

One more cool thing about Digital Paper: The company has been profitable since day one. Unlike the usual startup, it built a product and found customers before raising money. It eventually rounded up $9 million in financing from Edison Venture Fund, Columbia Capital, and Longworth Venture Partners. Despite little marketing, Digital Paper's software is now used in 18 countries, with versions available in six different languages.

Good news for trees.

--Cora Daniels