Only 39.8 percent of small businesses survive past the six-year mark and only one-third survive 10 years or longer. For any new business, the goal is to become one of the survivors. Entrepreneurs strive to learn the magic formula for success, studying successful companies in depth for years as they work to build their own enterprises.
Predictive marketing software company Mintigo recently used its technology to break down what makes and Inc 5000 company successful. Studying the Inc. 5000 list of successful businesses, Mintigo found commonalities they call "customerDNA" among these companies that can help a new business position itself for success. Mintigo has a massive data pool of B2B marketing indicators it applies to help improve enterprise marketing and lead gen efficiency. According to their findings, the following areas are important for success in business today.
When compared to businesses not on the Inc. 5000 list, these companies exhibit a greater use of technology to get things done. Successful businesses use Google email services, AdWords, and marketing automation to improve their productivity and branding. Inc. 5000 companies are also much more likely to use call center and data warehouse technology than businesses that aren't on the list.
Cloud technology has made it easier for even the smallest startups to put the best technology in place. For a small monthly fee, even a one-man operation can employ big business-style productivity tools and customer service offerings. As the study revealed, having the technology in place can make a big difference.
Hire Marketing and Web Design Staff
Inc. 5000 companies make a concerted effort to reach customers through marketing, especially through the use of public relations. By strategically planning each marketing campaign, these companies gain a clear edge over the competition. Inc. 5000 companies have more staff dedicated to this task than businesses that don't make the list.
Sales is also much more predominant in Inc. 5000 companies, with heavier sales staff on the payroll than non-Inc. 5000 companies. Successful businesses also tend to use popular CRM tool Salesforce.com to manage their sales activities.
Beef Up Your Business and Engineering Team
Also on the staffing side of things, Inc. 5000 companies place an emphasis on business and engineering in their hiring choices. Successful businesses are heavily investing in data analytics, judging by their staffing choices. Companies that made the list hire primarily for business analysts and SaaS-related positions, as well as customer service and graphic design.
For Inc. 5000 companies, future growth appears to heavily influence hiring decisions. IT security and DevOps are also top priorities as growing companies seek to strengthen their technology infrastructure.
While Inc. 5000 companies have 2.1 times the number of employees as those that aren't on the list, they also make better use of their staff. The study found that Inc. 5000 companies generate $211,000 per employee each year, while companies not on the list generate only $112,000 for each employee annually.
On average, Inc. 5000 companies employ 198 employees. This is compared to only 95 employees at each company not on the list. Considering their rapid growth, this difference in employees isn't tremendous, highlighting a need for businesses to make the most of the employees they have. When hiring or choosing contractors, businesses can improve their chances by focusing on hiring those who will be able to directly contribute to a business's growth.
Be in the Right Industry
Before starting a new business, an entrepreneur should seriously consider the areas where he'll more likely be successful. According to Mintigo President John Bara, "Successful companies tend to be geared toward rapidly-growing industries like software and Internet, computers, financial services, and healthcare. Twenty-four percent of the companies on the list are in business services, while 20 percent are in software and Internet."
This statistic is an interesting contrast to the overall business environment, which consists primarily of traditional companies. Real estate and retail are popular among companies, along with manufacturing and consumer services businesses. Interestingly, though, the smallest percentage of Inc. 5000 companies fall within those industries. To maximize chances success, businesses should aim for technology -related or health care-related industries, rather than going for other traditional services.
For any new business owner, it's important to channel efforts into the right areas to be successful. By studying the habits of rapidly-growing businesses, entrepreneurs can position themselves to succeed in a competitive environment. For better results, businesses can look directly at the businesses listed on the Inc. 5000 list of the fastest-growing companies in America for 2014 and note the common ground between each of the 5,000 companies listed.