Ian CasselKeymasterOfflineTopics: 107Replies: 37
In the book, Blueprint to a Billion, author David Thomson analyzes the fastest growing companies from 1980 to 2005. Years ago, after I read the book, I reached out to David and ended up interviewing him [HERE] just months before he unexpectedly passed away.
Thomson found that of the 7,454 companies that have gone public since 1980, 25% have failed or no longer trade, and only 5% (387 companies) have made it to $1 billion in revenues. These 387 companies are called Blueprint Companies. Thomson interviewed hundreds of upper level management teams that are/or were part of these top 5% companies to see what set their businesses apart from the rest.
Thomson found that Blueprint companies had three discernible growth patterns: (1) a variable runway; (2) an inflection point where revenue breaks out into an exponential trajectory; (3) variable growth rates to $1 billion revenue. He anchored his blueprint model at the inflection point because “this point marks the moment when the business was fully formed as a system – when it had a pipeline of customers, a product or service that was being shipped, and an organization capable of the functions to sustain ongoing growth.”
The book goes into detail of common quantitative and qualitative attributes of blueprint companies. Thomson outlines three distinct growth trajectories, post inflection, to $1 billion in revenues that were common after these companies hit their inflection points: Four year (ie: Broadcom, Cisco, Google), Six year (Microsoft, Starbucks), and Twelve years (Fastenal, Tractor Supply, Fifth Third Bancorp). Blueprint companies also had similarities when it came to marquee customers/partners that got them on the map, internal management styles, board makeup, and other more qualitative attributes.
I think entrepreneurs and investors will enjoy the book and findings. I will reference a few points David Thomson makes in future posts.
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