Many Inc. 500 CEOs become addicted to fast growth -- the exhilaration of laying it all on the line -- while some even plan fast growth just to make the Inc. 500. A look at this greed for growth.
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Ken Marshall, to his credit, was unapologetic. He just came right out and said how he felt. "I break into a cold sweat over the concept of no growth," admits the former CEO of Object Design, which topped the Inc. 500 in 1994. "Once you've done it, it's hard to think about anything else."
It sounds, well, a little sick. But Marshall isn't alone in feeling that way. For those who have maneuvered inside a fast-growing company--as a founder, a CEO, or even a key employee--the experience often transforms them so dramatically that they can't bear to put it behind them. True, few are as blatant as the CEO on this year's list who vows to shell out $10,000 in employee bonuses if the company grows fast enough to rank next year. (We resent what you're thinking, and no, he hasn't offered us a cent.)
Still there's plenty of persuasive--if more subtle--evidence that fast growth can be addictive. More than 30% of the businesses on our 16th annual ranking of America's fastest-growing private companies have appeared on the Inc. 500 before. At least a dozen of the CEOs or founders have scaled these heights previously, wrapped in different corporate garb. Charles Pesko, whose CAP International Inc. appeared on the 1986 and 1987 lists, ends his banishment as a Fast-Growth-Aficionado-in-Exile by landing on this year's list, having piloted CAP Ventures to the 69th spot. Pesko, who takes full responsibility for being a "real entrepreneur" who "has difficulty letting opportunities go by," nonetheless resorts to implicating his ancestors when explaining his affection for fast growth. "It's in my blood," he says.
That's about as credible--and elaborate--an exploration of growth's appeal as its most devout apostles can summon. Yet they readily admit to hunting growth. Hank Post, having sold one Inc. 500 company, scoured the 1991 rankings to identify a fast-growing niche before starting EMG (#141), a real-estate due-diligence firm. And Marlene Moncure claims that she and her brother set out to make the Inc. 500 with Wynne Systems (#229). Moncure previously served as vice-president of sales and marketing at Integrated Systems Management (#112 in 1986).
Try probing these folks about exactly why they're chasing growth and--rather than explaining--they'll tick off a list of sensations: the kick of swimming upstream, the excitement of teetering on the brink, the lively rhythm issued by alternating drumbeats of emptiness and fulfillment. Above all, there's the incessant invasion of stimuli: after making too many hires, you scramble to scare up new accounts, only to find yourself buried in customer complaints generated by all those inexperienced employees. Halfway to daylight, it dawns on you that your two top customers--one of which just filed for bankruptcy, if the papers are to be believed--are going to stiff you to the tune of $200,000, and there's a $50,000 payroll waiting at week's end. Make it to Friday somehow, and your reward appears in the form of a supplier's call: Your order won't be delivered on schedule because of a batch of flawed components. And, yes, those are the parts you need for an order you are contractually obligated to ship to a customer. Within 10 days.
Even Marshall concedes that fast growth imposes a daily regimen of "half exhilaration, half terror." Still, "the only thing better than being #1 on the Inc. 500 is doing it twice," insists Marshall, who traces his infatuation to five years spent at database giant Oracle Corp. (#105 in 1985).
Given their insatiable need to expand their empires, these growth hounds may very well be victims of the era's last uncelebrated dysfunctional behavior. Perhaps their inability to stop the insanity is fueled by a dangerous desire to finally prove their worthiness. But to whom? A dismissive teacher, perhaps, or an inattentive parent. Then again, maybe they just love the gig.
Study their companies--the rituals they invent, the feats they reward--and it's hard to conclude otherwise. They don't analyze the Inc. 500 experience because they don't need to: they know how effective it makes them feel. "Days go by fast, weeks and months go flying by," says Marshall. Growth can be a slog, too, but unlike workaholics--who grind themselves numb to any sense of purpose--fast-growth fanatics derive a sense of mission from constantly acting and reacting, simultaneously installing a layer of management, for example, while wedging open a foreign market. The prospect of lifting the numbers from this year's strategic plan and multiplying them by 1.15 to calculate next year's aims looks to them like corporate cruise control.
The entrepreneurs who built the 500 businesses appearing on this 16th annual ranking of the country's fastest-growing private companies are, to some extent, already struggling with a simple truth: the air is different up there. And once you've breathed it in, "it's hard to adjust to anything else," says Marshall.
But the singular experience of being in the grips of fast growth may be matched only by the experience of writing about Inc. 500 companies.
To research her portrayal of David Pitassi's struggle to manage his desire for fast growth, contributing writer Alessandra Bianchi negotiated the terms of the interview during three one-hour phone conversations. When the cofounder of diaper maker Drypers (#1 in 1993) finally agreed--it's possible that the background gurgling of Bianchi's six-month-old son, Jake, melted his resistance--he instructed her to meet him at his family vacation spot in Idaho. He declined to be precise about the location, not wanting his kin to feel beset. She tracked him down, but only after an airport shutdown forced her and her research associate (the aforementioned Jake) into a two-hour bus ride that dumped them in Sun Valley at 1 a.m. When she called Pitassi later that morning, he shared some news: he was cutting his trip short. His unmistakable ambivalence is part of the story she tells (" My Name Is Dave, and I'm a Growthaholic").
No bus ride for Nancy K. Austin. She's above that sort of thing--1,000 feet above. For her dissection of how Empower Trainers & Consultants (#47) is striving to preserve its unique environment, she took off in the company's hot-air balloon. "The company has that irresistible combination of deadly seriousness and total off-the-wallness," says Austin (" The Cultural Evolution"). "I don't like either one by itself."
During his visit to Omaha, reporter Mike Hofman was mostly by himself, prowling the city's sidewalks to prove that fast-growing companies can be found almost anywhere. However, Hofman's lonely trek (see " John Galt Boulevard, Omaha") did allow him to make friends: he shared one cab ride with a dog. (We resent what you're thinking, and yes, we picked up the pooch's tab.)
The Inc. 500 is a special journey for everyone: the entrepreneurs, the Inc. staff, and now (we hope) you. Enjoy the trip.