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High-Impact Entrepreneurs, High-Performing Companies

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High-Impact Entrepreneurs, High-Performing Companies

EY looks at high-impact entrepreneurs, and what sets them apart.

A report issued today by EY, in collaboration with the Ewing Marion Kauffman Foundation, examines the key attributes of uniquely-impactful entrepreneurs and their high-performance companies.  The report, created in concert with EY’s Entrepreneur of the Year initiative, addresses all sizes and types of companies, including those comprising the middle market.

The report notes that while just 5-7% of all businesses are high-impact, those businesses create most of the new jobs in the U.S, with the average high-impact entrepreneur generating 30 more jobs than the average comparable company. Such companies particularly excel in the areas of revenue growth, with median sales growth of more than 30% per year in each of the last two years, and headcount, with the average headcount of more than 30% per year in each of the last two years.

"While just 5-7% of all businesses are high-impact, those businesses create most of the new jobs in the U.S, with the average high-impact entrepreneur generating 30 more jobs than the average comparable company."

What makes these high-impact companies hum? EY outlines some of the many qualities that set several types of entrepreneurs apart.

  • Private companies – Private companies are the dominant force in high-impact entrepreneurship, and they represent 88% of the U.S. EY Entrepreneur Of The Year finalists. With exceptionally fast historic growth – 33% in revenue and 26% in employment, these private companies are united by their relative freedom to operate. They have the flexibility to make investments – which may call for near-term sacrifice but have long-lasting benefits – free from short-term public market pressures and competitors' access to disclosed information.
  • Public companies – Public company finalists, firmly established global players, display the operational rigor that every entrepreneur can and should emulate. These companies are focused on the future – they see the next transformation coming, and they begin preparing for it well ahead of time. The strength of public companies is their ready access to capital and the organizational discipline and focus that must accompany having publicly traded securities.
  • VC-backed companies – VC is still one of the best options to fund the early and scale-up stages for innovators that are disrupting incumbents and creating new market niches. Among the EY Entrepreneur of the Year finalists, these companies have grown the fastest, with median revenue growth more than twice that of the other finalists and headcount increases at a rate of 50% higher than the overall group. VC-backed companies, with their high-risk / high-reward innovations, challenge incumbents, create new markets and often redefine what consumers seek and how business gets done. Playing a big role in catalyzing innovation, venture capitalists not only mentor entrepreneurs that are creating the jobs of tomorrow, but they also provide access to valuable networks and offer the wisdom they have gained by investing in numerous enterprises.
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