* * *
* Impact Printhead Services (#87) started out as a general computer-repair company; founder David Gillett repaired the occasional dot-matrix printhead, along with disk drives and monitors. Then Gillett developed an add-on component for the Macintosh that he tried to market nationally. He found no takers. But the dealers he mailed to did respond to a little notice at the bottom of the brochure mentioning that Gillett's company also refurbished dot-matrix printheads. Today the Mac product is dead and general repair a thing of the past: Impact will do an estimated $7.5 million this year solely as a remanufacturer of dot-matrix printheads. Among its clients are Ford Aerospace, Lockheed, and several third-party repair companies responsible for maintaining corporate America's computing systems.
* * *
* Sean Repko, founder of Exsel (#298), wanted to sell used computers, but not the same way the dozens of tiny exchange services springing up around the country did. On the contrary: he would buy in large lots, remanufacture the computers and issue new warranties for them, then sell through the mail at prices no new-computer dealer could hope to match. Then, just this year, IBM announced the computer industry's first trade-in program: like auto buyers, customers can bring in their old machines and walk away with new ones. And who will be refurbishing and reselling the old computers? "We just signed a national agreement with IBM," crows Repko. "Its 3,000 retailers out there? All their used equipment will be picked up and sold by Exsel."
What's striking about the computer business is how easy the Inc. 500 entrepreneurs found it to enter -- and how many opportunities for growth presented themselves along the way. Marc Greenberg and Geoffrey Snelling of Small Systems Management started with $920 and little business experience; their chief asset was a willingness to listen to (and learn how to solve) the variety of computer problems their small-business customers encountered. Daniel Armbrust of Softworks Development was a college dropout with $600 in his pocket when he set up shop. Gregory Jameson, founder of LANDCADD (#464), was pursuing a professional career as a landscape architect and developed his land-planning program in his spare time.
Despite such beginnings, many of the young companies have expanded overseas. LANDCADD, for example, expects to collect more than one-third of its revenues this year from foreign sales. And several of the companies have moved almost effortlessly from one product to another. Armbrust began in software, as his company's name suggests. But when his cash flow began to dry up, he segued smoothly into hardware manufacturing. Incredible Technologies, the software company, started out in home video games, won the contract to develop BattleTech Center, and moved into the development and manufacturing of coin-operated video games -- now, it's creating computerized point-of-purchase displays for the likes of USG, the building-materials giant. "We're going to keep advancing our technology," says founder Elaine Ditton. "I see us continuing to grow."
Maybe someday all this growth will truly slow down: the industry really will mature and consolidate, and computer-related companies will be overrepresented on the Fortune 500, not the Inc. 500. That day, however, isn't right around the corner. For at least the next couple of decades, entrepreneurs who are looking for fast growth will still be placing plenty of bets on the not-yet-moribund computer business.
PSST! OVER HERE
The industries that growth companies love
The quickest route to membership in the Inc. 500? Build your company in an industry that itself is booming -- an industry where no one loses sleep over market share, because the market as a whole is expanding so rapidly. Computers are the obvious case in point. (See "Hot Markets," [Article link].) But several other industries also have proved to be engines of growth over the past half-decade, as evidenced by the makeup of this year's 500:
Environmental services. From Delta Environmental Consul-tants (#19) to Marine Shale Processors (#476), some 30 companies make their living in environmental analysis, hazardous-waste removal, and a half-dozen other businesses spawned by modern ecological rules and procedures. Niches you didn't know existed: Environmental Remediation (#370) is the United States' largest supplier of the bacteria used in waste-water treatment plants. Growing and selling the bugs accounted for 40% of the company's $12.8 million in fiscal year 1991 sales.
Health care. New technologies offer opportunities for growing businesses: just ask $36-million Maxum Health (#25), which provides magnetic resonance imaging, CAT scans, and renal lithotripsy (dissolving kidney stones with radiation) in 21 states. But the United States' voracious health-care marketplace also creates niches for companies such as PPOM (#154), a network of health providers that promises to cut insurers' costs, and American Biodyne (#349), which operates managed-care mental-health programs. All told, 28 of this year's 500 are in health-related fields.
Personnel management. About a dozen Inc. 500 companies are in this narrow but blossoming business: temporary-help agencies, employee-leasing companies, payroll-services providers, and so on. First Benefit (#255) administers employee-benefit plans. Amstaff (#466) operates as an off-site personnel department. Unlike in the past, temp agencies don't just provide secretaries and hourly workers; Lab Support (#62) can send over analytical chemists, molecular biologists, and dozens of other highly skilled professionals for temporary work.
Other business services. The 120 companies on this year's list are hard to classify -- but overall employment in business services nearly doubled during the 1980s, a sure sign of a booming market. Inc. readers looking for vendors among this year's 500 would find public-relations agencies and printers, consultants and cleaning services, day-care centers and direct-mail experts, travel agencies and time-management specialists. Creative Marketing Incentives (#191) will organize a board of directors meeting or any other event your company might want to sponsor. Insta-Plak (#416) will commemorate the event with photographic plaques made on the spot.
To be sure, not every hot market will show up in the stats. Nature's Recipe Pet Foods (#170) began operations 10 years ago with an original line of meat-and-rice dog foods. Now, says founder Jeffrey Bennett, it has 13 or 14 competitors. Who knows? Maybe a couple will make 500s of the future.
