It is always tempting to take a Zeitgeist lens to the Inc. 500. So many gluten-free and renewable-energy and save-my-smartphone businesses. In that context, the secret to launching hot companies is clear: Sniff trends early and strike.

And, in fact, our annual list of America's fastest-growing private companies is full of entrepreneurs who have carpe'd the diem. Particularly in industries such as health care, financial services, and technology, the Inc. 500 mirrors the most robust sectors of the U.S. economy. Electronic-payment processors (see "Fintech Finally Lifts Off"). Niche retailers. Boxing fitness companies. Still doubt the trajectory of e-health businesses? You missed an opportunity.

Riding that relevance, this year's Inc. 500 achieved a median growth rate of 1,772 percent. And these companies don't merely reflect the economy. They also contribute to it, having collectively created 57,822 jobs. Most of the founders with companies on this list had the right idea at the right time. Or even before the right time. Fitbit got started before consumers understood that they would love the idea of downloading their physical lives onto a bracelet. Entrepreneurs who are just slightly in front of the wave have to be particularly adept. Like all entrepreneurs, they need determination, risk tolerance, and creativity; but they also need the staying power to survive until their vision becomes our reality.

More important, though, is something else. They are students.

In the 1990s, systems scientist Peter Senge popularized the concept of learning organizations: groups that are engaged in perpetual journeys of self-education. One discipline practiced within such organizations is "personal mastery," which Senge described as a distinct kind of proficiency that is associated with a vocation or calling. "People with a high level of personal mastery are acutely aware of their ignorance, their incompetence, their growth areas," wrote Senge. "And they are deeply self-confident." That is the paradox of successful entrepreneurs--they are flawed but fearless.

Entrepreneurs often seem like dilettantes, jumping in when the jumping looks good. But just as often, their callings are unexpected. Their insights lead them to become immersed in unknown markets, forcing them to soak up everything.

Consider David Glickman, who this year took a second company to No. 1 on the Inc. 500, an unprece­dented feat. Glickman came to his industry--telecom--by accident. As an executive charged with reducing overhead at American Express in the 1990s, he found a way to make cheap international calls. When Amex turned down his idea (haven't we seen this movie before?), he left and built Justice Technology: No. 1 on the Inc. 500 in 1998. Ultra Mobile (see "A Telco Giant-Killer Stalks Another Target"), this year's top shop, takes Justice to a higher level, selling low-priced mobile plans that include free international talk, text, and data.

Between starting Justice and Ultra, Glickman founded or co-owned seven other telecom ventures (two of which also made the list) and held positions in more trade associations than you can shake an acronym at. He's dedicated his entire professional life to mastering this market. "Sometimes, it's like putting on a big catcher's mitt," says Glickman of his industry involvement. "You become the receptor for all these opportunities, and because you've watched companies succeed and fail, you know how to evaluate them." He points out the irony that, in his first startup, he was a guy with limited knowledge teaching people with virtually no knowledge.

Now that he has a team that boasts hundreds of years of combined experience, a role reversal takes place. Teacher becomes student. Working with this team "is almost like the last 20 minutes of The Matrix, when you suddenly see things in a different way," he says. In this regard, Glickman is following a path that some other repeat Inc. 500 honorees have trod before him, specifically, entrepreneurs who have taken companies to the No. 1 spot and--earlier or later--placed businesses elsewhere on the list while staying within one industry. Tim Litle (with a company that made the list twice in the '90s and another, of the same name, that hit No. 1 in 2006) was a direct-marketing pioneer. Two David Giuliani entities, Optiva and Clarisonic, made the list multiple times; Optiva hit No. 1 in 1997. Both were in the sonic-powered cleansing-product space, which Giuliani virtually invented.

Reaching a depth of understanding about an industry is just one aspect of an entrepreneur's education. Conventional wisdom holds that founders make the best salespeople because they are intimately familiar with their products. In fact, the opposite could be true: Founders become intimately familiar with their products through the experience of selling.

The story of Ben Weiss, CEO and co-founder of Bai Brands (No. 127; see "Taking the Slow Lane to Growth"), is typical. Like Glickman, Weiss more or less stumbled across his product, coffee fruit: It was a natural antioxidant. Weiss turned it into a beverage. He then set about visiting real stores, getting in front of real customers, and inviting real criticism and challenges. Like the best students, he wasn't seeking validation but, rather, insight. With those early lessons, Weiss laid the foundation for the more advanced education he knew he'd need to scale his business, which is reaching national distribution this year.

More broadly, the fundamentals of business and leadership present their own, ever-expanding curriculum. In response to a survey question, hundreds of Inc. 500 CEOs described hard lessons learned from experiences that could have killed, but ultimately strengthened, them. Some of those lessons involved brass tacks: how to price proposals, hedge risks, divide equity, or establish metrics. Some were more abstract: You can neither please nor trust everybody. Some were personal: "I am not a team player."

Jessica Mah didn't think like a student when she launched inDinero (No. 146; see "A Pivot, a Therapist, and a Revival"), a firm that manages back-office finances for small businesses. Instead, she and her co-founder operated on a series of assumptions about what their product should do and how much they could charge for it. Only when those assumptions proved wrong did Mah's pursuit of personal mastery begin. After scaling way back, she interviewed countless potential customers about their problems and how they could be solved. A computer science major, Mah asked herself: How can I master of taxes and accounting? The answer: Become an IRS-enrolled agent. So she did.

Mah admits she made assumptions not only about what kind of business to run, but also about how to run a business. She now views every day as an education. In 2014, four years after launching inDinero, Mah junked the old content on her blog and started fresh, because at that point she knew better. For example, once she'd preached slow-to-hire, fast-to-fire; with experience, she's realized that in a torrid job market, the race belongs to the swift at both ends. And she no longer considers heavy-duty sales or speculative meetings with outsiders a good use of the CEO's time. "It's almost embarrassing how I spent my time before," says Mah.

For the past couple of decades, founders and academics have debated whether entrepreneurship can be taught. It's a futile argument. Entrepreneurship is being taught, as the proliferation of accelerators, university programs, and how-to books attests. The larger point is that entrepreneurship must be learned: usually in the trenches, ideally by people who are endlessly curious about how their own businesses and business in general work. All our Inc. 500 founders started with great ideas. Since then, they've been looking to the world to teach them how to turn them into great businesses. 

 

How the 2015 Inc. 500 Companies Were Selected

This year's list measures revenue growth from 2011 to 2014. To qualify, companies must have been founded and generating revenue by March 31, 2011. Additionally, they had to be U.S.-based, privately held, for profit, and independent--not subsidiaries or divisions of other companies--as of December 31, 2014. The minimum required 2011 revenue is $100,000; the minimum for 2014 is $2 million. Revenue listed in the company profiles is for calendar year 2014. Employee counts are current. Employees receiving benefits are included in the employee counts. Inc. reserves the right to reject applicants for subjective reasons. The companies of the Inc. 500 represent the top tier of the Inc. 5000.