Inc 500/5000 is out. This is the 30th anniversary of the list. That gives an idea of how new entrepreneurship as a mainstream, social activity is. This did not go on 50, 100, or 200 years ago. Lets be thankful for that! From @LeighEBuchanan at Inc Magazine.
In 1981, economist David Birch had yet to isolate the job-creation might of fast-growth companies, which he famously dubbed gazelles. The venture capital industry was just starting to bulk up; it raised $4 billion in 1980. But the Inc. Private 100 was already pounding home some central tenets of contemporary entrepreneurship: the tendency of private companies to outpace public ones in performance and employment, the desirability of organic growth, the ascendancy of asset-light enterprises over capital-intensive ones.
Last year, Litan published a fascinating paper contending that the United States could goose GDP by 1 percent annually if every year it minted 30 to 60 companies that eventually reached $1 billion in annual revenue. In the paper he concluded that, over a century, a 1 percent annual bump would mean “a dramatically lower level of poverty, while the average American would have a living standard that is three times as comfortable as one that he or she would otherwise enjoy.”
Litan’s inspiration was a study by Yale economist William Nordhaus, who suggested that inventors capture only 4 percent of the value of their inventions, while the other 96 percent “leaks out” to other businesses and industries. Substituting entrepreneurs for inventors, Litan calculated the impact of so many large, successful businesses, which would become substantial employers, create work for suppliers and distributors, and—most intriguingly—inspire additional start-up activity around new platforms they might invent. “I picked a billion dollars as a proxy for firms that generate substantial externalities,” says Litan. “You build a company that size, and a lot of people benefit. If you are a car company, for example, you have employees and suppliers and dealers, and the employees of those suppliers and dealers. Add up all those things, and they swamp what the founder gets.”
Check out the full article and the companies in the Inc 500.