Blurring the lines
Entrepreneurs have never followed the rules. Why start now?
Find out what the EY Entrepreneur Of The Year™ 2014 finalists are doing to attract funding, disrupt the boundaries of traditional industries and scale quickly. Innovation and youth trump tradition in EY’s latest report.
The companies of the 663 EY Entrepreneur Of The Year US finalists provide a snapshot of the key characteristics of the nation’s fastest-growing companies. Together, the businesses represent $197 billion in revenue and employ more than 529,000 people.
In each of the last two years, these companies experienced average revenue growth of more than 30%.
More about their performance can be found here.
Never complacent, these entrepreneurs continue to blur the lines between dreams and reality.
Deftly using technology to disrupt the status quo, many of this year’s finalists self-identify in the tech sector, a strategic move that is becoming more common for those businesses in pursuit of funding.
Nearly half (46%) of the finalist companies are 10 years old or younger, demonstrating how young firms are driving innovation and job creation in the US economy while thriving during the worst global economic downturn since the Great Depression.
Fueling the fire
The broad adoption of technology among a relatively young population of entrepreneurial companies yields a heightened interest by professional investors to fund and scale the innovation they bring to market. Some interesting trends are emerging as a result.
- While venture capitalists are committing to the same amount of capital, they are staging the funding due to the low start-up costs associated with establishing businesses today. Once the business has a proven value proposition, additional funding is provided to finance the company’s growth.
- The line between venture capital and private equity (PE) also seems to be fading. More PE firms have begun investing smaller companies with higher growth potential, a field traditionally only touched by venture capital.
- To sweeten the pot, these PE firms have added robust networks of advisors and consultants that are able to improve operational effectiveness and increase value.
- Digital transformation is driving deal making as companies seek to accelerate their adaptation to technology megatrends.
As markets stabilize and confidence rises, investors are fueling a new wave of innovation-led IPOs. An impressive 27 companies from the 2014 finalist group have gone public since the start of 2013.