As investors, we rarely get to see an industry transform before our very eyes. For the sleepy world of insurance exchanges, Ebix (Nasdaq: EBIX) wants to be that engine of change.

To get to the heart of the company, Motley Fool Rule Breakers analysts Sean Sun and Karl Thiel and Motley Fool Pro advisor Jeff Fischer interviewed Ebix CEO Robin Raina, and we hosted a live chat with the CEO for subscribers of those services. Today, we're publishing the full transcript of that question-and-answer session. Together, we hope the interview and the chat present a revealing and compelling portrait of one of the fastest-rising stars in the business world.

What follows is a lightly edited transcript of the chat.

Live Chat With Ebix CEO Robin Raina, Sept. 23, 2010

Jeff Fischer (TMFFischer): Greetings, and welcome to The Motley Fool's Live Chat with Ebix CEO Robin Raina! The Rule Breakers and Motley Fool Pro teams are delighted to host this chat with members, specifically so you can ask Ebix's CEO your questions directly. Please enter each question just once; we'll see them all, and Mr. Raina will answer as many as he's able to during the hour. Thank you again!

[Question from johndashner]: What will EBIX look like in five years with regard to revenue and earnings?

Robin Raina, Ebix CEO: Ebix does not like to give any guidance related to revenues or earnings. We prefer to have our past speak for us. We are quite bullish about our future. Our strong faith in our fundamentals is based on our high percentage of recurring revenues, low customer attrition rate, infrastructure exchanges, and the global nature of our business. There is no competitor who can provide enterprise solutions in insurance like Ebix across the world. All of this should help us grow continuously. We have already conveyed in the past our desire to be at a revenue run rate of $50 million or more in the fourth quarter of 2011. We would like to get there with 40% or more in operating margins. That is the extent to which I could talk about the future.

[Question from Richard Casey]: What is the expected growth for 2011?

Raina: Richard, my previous answer should address your question.

[Question from Norman1066 (Tim)]: At one point Mr. Raina suggested that Ebix had an $80 billion market opportunity. Does he still believe that number, and with the exchange business model, is it a "winner-take-all" opportunity? How long of a development timeline should we anticipate for Ebix to address that entire market opportunity?

Raina: The exchange opportunity is clearly at the center of our business model. The opportunity is to replace paper in the insurance industry across the world. Exchanges today are 71% of our business worldwide. We expect exchanges to continue to be the prime driver of our growth. It is extremely difficult to come up with a timeline as regards Ebix addressing the entire market opportunity. However, we know that in any market only one exchange can succeed. Our focus is on ensuring that Ebix is that exchange.

[Question from Roger May]: Would you anticipate another stock split near term -- say, one to three years ?

Raina: Cannot really predict that as of now -- anything is possible if it makes sense and the stock attains a decent value in the future.

[Question from Fred]: Do you plan to pay dividends in the future -- or rather invest in growth?

Raina: Anything is possible in the future. At present we see Ebix as a growth story and we prefer to invest our cash in growing the company both organically and inorganically. Our belief is that our shareholders will get much better returns that way.

[Question from Bob E.]: Which companies do you see as your greatest competition?

Robin Raina: There is no one competitor that Ebix faces across the world. Competition tends to be different in each country and, further, in each sub-channel of our business. As far as exchanges go paper tends to be our biggest competitor.

[Question from tj]: Are there competitors in your space that are mimicking Ebix's growth strategy? Can you shed more light on the competitive landscape front?

Raina: My previous answer should address the second part of your question. We do not know of a competitor in the insurance industry who is mimicking our growth strategy. By the way, I am pleased to be here and to be able to have a direct dialogue with all of you. Thanks to Motley Fool for giving me the opportunity to be here.

[Question from Leslie (Duwango)]: Please address growth in Brazil with Ebix.

Raina: The Brazilian insurance market continues to grow. We want to take an early position in Brazil as an enterprise player, with exchange being at the center of our growth strategy in Brazil. You are likely to hear a lot from us about Brazil in the near and long term future as we continue to implement our growth plans here. Incidentally, I am in Brazil at present and participating in this meeting from our Sao Paulo offices.

[Question from Jeff Lam]: What assurances can you give us against the high short interest of Ebix? What do you attribute the high short interest to? And how do we know for sure that it's not an indicator of an underlying problem in the company?

Raina: We believe that we should not be a good short candidate for anybody. Any company who continues to generate strong cash flows and has very little AR that is more than 12 months old does not deserve to be shorted. We do not know of any underlying problem in the company that should invite shorting on our stock. We live in a free country and everybody is entitled to their views. We continue to focus on our fundamentals -- our cash flow last quarter was $6 million or so, our AR for more than 12 months was approx. $600,000. These numbers talk about the strength of our results.

[Question from tj]: I have always believed that happy employees equal a successful company. Do you feel your employees are 'happy'?

Raina: Our senior management team has essentially been there for more than a decade now. Our retention rates are the envy for any company. We agree that employees are the biggest assets of any company.

[Question from Karl Thiel]: Robin, what worries you most when it comes to a potential disruption, competitive challenge, or other shift in the landscape that would negatively impact Ebix? (I'd ask what it is that keeps you up at night, but it sounds like you are already up at night!)

Raina: Karl, I am a sound sleeper so it is hard to keep me awake at night. I worry about Ebix getting carried away by its own success. I do not want to build a disjointed company with disjointed products all across the world. In my mind Ebix has just gotten started. We are far from being successful in our eyes. Accordingly, we remain focused on end-to-end integration, cutting-edge technology, centralized core functions, and a high-quality workforce.

[Question from tom]: What has been the change in the stock price over the past two years? What is your current EPS?

Fischer: Hi Tom and Fools: We're going to jump in and answer some questions that we're able to answer, while Mr. Raina continues to answer the ones that are best answered by him. To answer your question, Ebix was $11.21 on Sept. 24, 2008, so in two years the stock has nearly doubled. That said, it was $14 early this year, too, so recent buyers have enjoyed a very meaningful gain, as well. The stock now trades at about 17 times trailing 12-month EPS.

[Question from Bob Trurl9]: Does Ebix plan to expand into other businesses beyond insurance? Digital instead of paper medical records come to mind.

Raina: Bob, our core focus will remain insurance, though we intend to address the bank assurance and financial markets while doing so.

[Question from JS]: Can you tell investors one reason to be excited about investing in Ebix?

Raina: Infrastructure exchanges with strong recurring revenue streams coupled with strong operating margins. In my book the biggest strength of Ebix is the consistency of our business model, along with the financial discipline that we exercise.

[Question from RSue]: Currently, what percentage of Ebix's business is concentrated in the U.S., and what percentage is global? How do you project that proportion to change within the next five years? Thank you for considering my question.

Fischer: Greetings, RSue: According to our recent research at Pro, about 24.9% of Ebix's revenue was derived *outside* the United States the last 12 months. And Mr. Raina has said in the past that, over time, international sales should become a much larger percentage of total revenue at Ebix.

[Question from Fred]: I am very impressed by your philanthropic work and would like to hear more about your division of time between this and Ebix.

Raina: Fred, thanks for your encouraging words. In my mind, charity and work complement each other. Charity gives me the peace of mind and humility to be able to make rational decisions on the work side and also the ability to listen to other peoples' viewpoints. There is no real time division between the two as I do both of them at the same time and on a minute-to-minute basis.

[Question from Sara]: Mr. Raina, I understand that you typically get by on about three hours of sleep a night? Are you not concerned about burnout? What do you do to stay physically fit and mentally acute?

Raina: Sara, I get enough sleep to keep myself energetic at all times. I find enough time to play ping pong everyday and also spend time with my kids. I feel healthier and younger than ever today. I guess energy, motivation, and age are a function of one's' state of mind.

[Question from Jim]: How does Ebix's exchange revenue model work? How do you define 'recurring revenues' -- i.e., do revenues / recurring revenues refer to a fixed dollar amount ('all you can eat') per time period spelled out in your contract with your exchange customers; or are Ebix contractual relationships with customers based solely upon the number of transactions flowing through Ebix platforms each quarter, or some combination of the two?

Fischer: Hi Jim, it's really a combination. Companies pay a fixed rate to be on the exchange (they also pay a bit toward maintaining and improving the exchange, if I understand that part of the revenue correctly), and participants pay a small transactional fee each step of the way in a transaction.

[Question from Tim]: How is the Brazilian business Ebix acquired a short time ago going? Are there other "emerging economy" markets of immediate interest to you? Is China a place you foresee doing business in?

Raina: Quite well. Brazil, Russia, China, and India are going to be big opportunities in coming days.

[Question from DRSC]: Ebix has been fairly aggressive in acquisitions. Has this strategy been dominated more by the desire for increased market capture or product/capabilities expansion and which of these do you see playing the larger role in future acquisitions?

Raina: Sometimes acquisitions are made for reasons of entering new geographies and opening up doors for cross-selling. Sometimes we make an acquisition because we want to enter a functional area where we do not have the expertise. There are many other reasons that drive us in terms of our acquisition strategy. Rest assured anything we do on the acquisition front is likely to be accretive in the short and long term for our shareholders as also it is likely to have very strong recurring revenue streams and cash flows.

[Question from Guest]: Does Ebix focus on life insurance, or does it do general insurance in these exchanges?

Raina: Ebix provides exchanges in multiple areas like Property and Casualty, Life, Annuities, Health, Placements, Risk Management, Workers Compensation, etc.

[Question from firor]: Please shed light on the ADAM acquisition legal actions now under consideration, and whether this is a significant call on management time now or may be in future.

Raina: We do not know of anything that should concern us as regards ADAM. Thank you everybody for giving me the opportunity to interact with you.

Ebix is a Motley Fool Rule Breakers selection.If you’re already a Rule Breakers member, you got the chance to have Mr. Raina answer your questions. But if you’re not, sign up for a free 30-day trial, and make sure you're on the front lines of our most exclusive content.

Rule Breakers analysts Sean Sun and Karl Thiel own shares of Ebix, as does The Motley Fool. The Motley Fool has a disclosure policy.